Why Not Charge?

In another blow to third party developers, Twitter announced a new policy regarding API access for direct messages. It’s a hard dish to swallow for both developers and users. While the news hasn’t been exactly welcomed with open arms, it’s not exactly surprising either. As Twitter continues to try and find ways to monetize their service, it’s becoming apparent that they will do anything, short of coming out and dropping third party support entirely, to make sure as many users as possible flock to their official Twitter clients.

Rather than keep banging their heads against the wall, Twitter should stop protecting their future ad revenue 1 streams by stymying third party developers and simply monetize it’s biggest asset, the service itself. And while most people are quick to believe charging to use Twitter would spell it’s doom, let’s examine a plausible scenario:

Charge users who want to post tweets/replies/DM. Keep the service free for those who just want to follow.

An Edison Research study about Twitter use in 2010 found that a slight majority of people only use the service to follow other users. This goes a long way towards explaining why most people wouldn’t pay to use Twitter. Afterall, they can simply go and keep track of celebrities for free elsewhere. However, it stands to reason that Twitter users who actively post messages and use the service to communicate and build relationships with others would likely have no qualms paying for the ability to keep doing so. It doesn’t even have to be much: Twitter claims there are about 460 000 new users, on average, per day subscribing to their service. If they charge the half of users who do use Twitter this way just 2.99 per year for full access, it would work out to approximately 250 million dollars of gross revenue per year. They could probably get away with charging more or offering different price structures.

People who tweet regularly can appreciate what an asset Twitter’s large global network is. There’s nothing wrong with charging those users, myself included 2, for continued access. Instead of selling their audience to advertisers, they can sell it other users instead. Best of both worlds.

Most of the people who threaten to quit Twitter if it became a paid subscription are those who use it simply to consume news and entertainment, as they would on the New York Times website. That’s fine, Twitter doesn’t need to erect a pay wall for everyone.

The problem, as I see it, isn’t that Twitter is incapable of finding a way to turn a profit from its service but rather that they’re unwilling to take a stance one way or the other and face whatever consequences may occur. They’re scared. They aren’t confident their service has intrinsic value, which it does in spades. Sure, a paid subscription would be a drastic change, but it needn’t be a fatal one.

Continuously aggravating your most ardent user base with boneheaded shenanigans, however, generally is.

1. Besides, businesses already have their own Twitter accounts and reach out to consumers simply using the service as intented and purchasing trending topics.

2. Most of you reading this have come either directly or indirectly from something I posted on Twitter.