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Snapchat Launches Snapchat+ Service in India, at a Significantly Lower Price Point

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Snapchat Officially Launches its New 'Snapchat+' Subscription Program

This is one way to boost your ‘average revenue per user’ stats.

A month after launching its new Snapchat+ subscription offering to users in predominantly western markets, Snap is now also making the option available in India – though at a much lower price point than the initial push.

Snapchat+, which offers exclusive access to new and experimental features, including alternative icons, profile badges, additional analytics and also a desktop version of the app, is available to users in the US, Canada, the UK, France, Germany, Australia, New Zealand, Saudi Arabia, and UAE for $US3.99 per month (or local equivalent).

But in India, Snapchat+ will be launched at a starting price of 49 – which converts to around $US0.62.

That seems like a fairly big discount, and according to reports, Snapchat+ in India will offer access to all the same features and tools that the general offering has.

So why so cheap?

Well, for one, it’s a different market, and Snap needs to price its offerings in line with the local economy. Snapchat+ also doesn’t cost Snap anything to produce, as such, as there are no production costs built in (other than system maintenance), so it has the flexibility offer variable price points, if it so chooses.

And as noted, it could crucially be a way for Snap to enhance its revenue per user stats, which, right now, reflect its strong reliance on the North American market for revenue.

Snapchat Q2 2022

If Snap can even that out, and show how it can become a more important, valuable platform in other markets, and make money from its presence, that could help to improve its market standing, while also bringing in additional revenue – which would also be income that’s not reliant on ad spend. And like all social apps, Snap’s ad revenue has taken a hit due to Apple’s ATT update.

It seems like a logical and sensible approach, helping to make the app more sticky with Indian users, and ideally, increasing adoption and revenue intake in another key region.

Snap has seen significant growth in India since it upgraded its Android app back in 2019. Android is by far the most popular OS in the Indian market, and as local connectivity and tech continues to evolve, that’s also opened the door for Snapchat to establish a bigger local presence, while the banning of TikTok in 2020 also pushed Indian users to find alternatives, further enhancing Snap’s appeal.

Indeed, Snapchat is now reportedly up to 144 million daily actives in the Indian market, overtaking the US (108m) as its top country by user adoption – so while it’s not the highest earning region for the company, it is now, arguably, the most important, which is why the expansion of Snapchat+ makes sense.

And while western users may be annoyed that they have to pay more for these features, it could be a clever push by Snap, which could end up paying off big time for the app.  

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49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes

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49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes

Facing the truth and being responsible for your actions, no matter how unpleasant, is the mature thing to do. But that’s easier said than done. Especially when talk turns to business! Many companies and managers have a hard time being honest about what’s going on because they have a vested interest in staying profitable.

The r/AskReddit online community had a field day, calling out various companies that gave thoroughly ridiculous explanations for why something was happening. It’s perfect proof of why corporate communication has to be empathetic, not just robotic attempts to spin the truth. Scroll down to see just how ludicrously some businesses tried to protect their interests.

We wanted to learn about proper business communication, so we reached out to Matt Johnson, Ph.D., a marketing psychology speaker and the host of the human nature blog. He explained why transparency is paramount and shed some light on one of the best campaigns ever, aimed at repairing a company’s tattered reputation. You’ll find Bored Panda’s interview with the expert below.

“We reduce the performance of your older iPhone to keep it from crashing.” Sorry, Android doesn’t do this and this type of thing hasn’t been a problem for over 10 years. It WAS an issue with some of the earliest smartphones, but not since 2012 or so. Apple just does it to try to get you to upgrade or pay for a battery replacement.

Edit: gotta love the Apple sheep down voting me for speaking the truth.

WardenWolf Report

According to marketing psychology speaker Johnson, how a company approaches communication about problems will depend on the business itself, as well as how serious the issue is.

“If it’s a safety issue with the product, there are regulatory and liability concerns, and so almost certainly in these cases the company needs to come clean, do a recall, and formally apologize,” he explained to Bored Panda via email.

“In less severe cases, when the product is merely faulty and not dangerous, it’s still a best practice to take responsibility and apologize. The brand’s reputation is contingent on the quality of their products, and if they are consistently delivering a poor experience, this won’t be sustainable for the brand in the long term,” Johnson said.

Samsung destroyed my fridge while working on it. They agreed to replace it, and then told me they couldn’t replace my fridge they destroyed, because “they didn’t have any.”

They’re literally the manufacturer.

I filed a claims in small claims court and won and made them pay. It was ridiculously easy.

Nobody275 , Curtis Adams Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes McDonald’s and the coffee burn victim, claiming she only did it for the money. She didn’t – she was horribly burned by coffee kept far too hot that McD’s had been warned about repeatedly in the past and they still refused to fix.

Working_Buddy5527 , thiago japyassu Report

“It will force the company into a position where it is competing based purely on price and on the advertising effectiveness, which is typically a losing proposition. All in all, the default should be to take ownership, repair the product, and to be transparent to the consumer.”

Luckily for brands, consumers tend to be “surprisingly forgiving” when they’re transparent about their failures. “Three things should be in place in order to pull this off,” Johnson walked us through the process.

“First, the brand needs to have some degree of existing trust with their consumers. Secondly, the brand needs to be transparent and take ownership of its product’s failings. And lastly, they need to make the product genuinely better. When these three things are in place, consumers can be very forgiving which helps to restore the company’s reputation.”

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes Optus recently blamed a outage that affected the whole of Australia on a 3rd party. This “third” party was their parent company

coolevil98 , Yan Krukau Report

According to the marketing psychology speaker, one of the best examples of this was done by Domino’s Pizza, over a decade ago. It’s a prime example of how honesty, when mixed with grit and creativity, can yield great results.

“In 2011, Domino’s Pizza did the unthinkable: They came out and said that they’re pizza is terrible. They listened to consumer complaints, ran focus groups, and all the signs pointed to the same conclusions. And Domino’s said: you know what, you’re right,” Johnson shared with Bored Panda.

They ran a campaign admitting that their pizza isn’t what it should be, that they’d be making changes, and that in the future, their pizza would be better. And they did. Fast forward thirteen years later, and Domino’s is a beloved brand, who’s pizza is adored by their customers. They leveraged their trust with their consumers, admitted fault, and made the right changes. And in the end, their business greatly improved.”

You can find more of Johnson’s insights and posts on his marketing and human nature blogs.

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes Amys Baking Company after going nuts on facebook. They claimed they were hacked and were now working with the FBI to find out who was behind it

KermitTheFraud92 , Solen Feyissa Report

Reputation is everything in the business world. If your customers know that they can trust you, they’ll stay loyal. Trust, however, is a pretty ephemeral thing. A lot of different factors contribute to it. For instance, you need to think about the quality of your product and services, how your employees treat your customers, as well as how ethically you do business.

To put it bluntly, putting products and services aside for a moment, customers value companies that have clear values, act in a moral way, and are transparent about what they do. Businesses are like people: those who are trustworthy and respectable become true leaders. Meanwhile, shady behavior and avoiding responsibility will get called out. Consumers and employees alike hate it when someone’s trying to pull the wool over their eyes.

When a company runs into trouble, the first instinct is (quite naturally) to focus on survival. If something unethical happens, many businesses try to avoid the issue and present a counter-narrative. Their goal is to protect their reputation and profits. 

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes Many companies are notorious for calling their customers stupid when they’re sued for something. For example, when Subway was sued for undersized sandwiches, Subway argued that “Footlong” was just a trademark and there was no reason for anyone to think that it meant that the sandwich was 12 inches long.

Dynasuarez-Wrecks , Dennis Sylvester Hurd Report

However, this can backfire to a pretty big extent. If someone knows what really happened, they can blow the whistle and spill the beans for the whole world to know. When you get caught lying, it’s even worse. 

In an ideal world, every business, boss, and middle manager would be open, honest, and transparent about any and all issues, both with their employees, as well as their customers. However, in reality, companies are constantly competing for people’s money and attention. So showing any signs of weakness, when your opponents probably won’t do the same, would be ludicrous.

It all comes down to the fundamental values upon which a company is built. Founders and managers who fully embrace transparency and empathy are going to tackle any issues that arise very differently than someone who always puts profit first… at any moral cost. Just to be clear, there’s nothing wrong with being profitable. But it has to be balanced with ethics, a sense of purpose, and proper motivation for workers.

Pier 1 was blaming their employees for not upselling/getting enough credit cards before they went bankrupt.

I could buy the same blanket at home goods cheaper than my discount at Pier 1!

hernkate Report

Obviously, employees want to get a fair wage, have plenty of room for growth, and only ever deal with supportive bosses. That won’t always be the case. It becomes necessary to screen businesses for their work culture ahead of time before you’re in too deep. So before you think of applying for a position at some huge conglomerate, do some research. Read up on what their workplace culture is like, see if they’ve ever been embroiled in some deeply troubling scandals.

Forbes suggests checking whether a company’s online presence is “professional and legitimate.” That means looking at their website, how they respond to customer inquiries and criticism on social media, and what (former) employees have to say on job sites like Glassdoor and LinkedIn. It’s definitely a red flag if you spot examples of awful customer service.

If a business has tons of negative reviews online, something is probably amiss. However, just like you shouldn’t blindly trust any corpo PR dribble, you should take any reviews with a few grains of salt. Actually, scrap that, pass the whole salt shaker!

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes “we need everyone back in the office buildings now because the 3 years of working from home didn’t actually succeed and everyone has to be back in the office for the work to get done. It has nothing to do with needing all the workers to resume spending their money on all the stuff they didn’t have to for 3 years.”

forgotten_epilogue , Arina Krasnikova Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes I quit a job after the entire company was being forced to sign away our rights to ever sue the company. (This was after they were getting sued for not paying their employees accurately).

The topper was that if we elected not to sign, we would be forfeiting ALL BONUSES until we did sign.

I quit within a couple weeks and told my boss directly that a leading factor in why I was leaving.

He left shortly after too.

elmatador12 , EKATERINA BOLOVTSOVA Report

Comcast changed its name to xfinity because Comcast was well regarded as the worst customer service on the planet and you couldn’t search their name without it pulling up page after page of customer stories about how bad they were.

They didn’t fix their customer service they just changed the name of the company as if it would reset their reputation and it on some level worked.

Pencilowner Report

It’s vital to filter which reviews give an accurate representation of reality and which ones are written by someone who is extremely disgruntled about e.g. being fired (perhaps for poor performance or other issues). A good rule of thumb is that the more emotional a review is, the more biased it is. The truth isn’t black and white, it’s often nuanced. Sure, any company might make some mistakes. But it doesn’t mean that these businesses fail in every single regard.

You won’t ever find a ‘perfect’ company, but you can come across businesses that admit to having made mistakes and then work to correct them. If you ever have any doubts, as a prospective worker or a potential customer, get in touch with the business and ask some questions about their culture and values.

SpaceX offered to build a submarine to rescue people in a cave. They drew a design and everything. Had a whole plan. A guy said no thanks so Elon Musk called him a child molester.

Gladysfartz Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes I used to drive for Schneider National Carriers. My husband and I hit from behind by another semi. Schneider deflected it back to us saying that if we wouldn’t have stopped for a shower 10 hours previously we would not have been there to get hit in I -40

Heavy_Permission5704 , formulanone Report

Tucker Carlson being sued as part of Fox News and his lawyers stating that what he says “cannot reasonably be interpreted as facts.”

Maniacboy888 Report

Tesla’s Full Self Driving is *always* only waiting on regulators to approve it.

Really it’s s**t software that doesn’t work.

fossilnews Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes [Air Canada 624 landing in Halifax](https://en.wikipedia.org/wiki/Air_Canada_Flight_624). For a while their press releases stated that it was a “hard landing”. The fact that 24 people were injured, engines separated from the wings, and the plane was written off didn’t seem to figure into it.

mks113 , Oleksandr P Report

April 20, 2010 [the Big Horizon Oil Spill](https://en.m.wikipedia.org/wiki/Deepwater_Horizon_oil_spill)

An estimated 4.9 MMbbl (210,000,000 US gal; 780,000 m3) of deep water oil spilled into the Gulf of Mexico. It’s considered the largest marine oil spill in petroleum history.

On May 4, of the same year, they were awarded the [Safety Prize](https://abcnews.go.com/amp/Blotter/louisiana-oil-spill-feds-gave-safety-prize-transoceans/story?id=10528236) for their outstanding performance *in 2008*.

So, basically , the feds claimed they deserved the prize because in 2008 they did such a good job and their only accident was the 2010 oil spill. Never mind that it was so huge that in 2019 there was still oil floating around the Mexican Gulf from that very same spill.

FknDesmadreALV Report

“Pride and Accomplishment”

Edit:

Oh yeah, and also “Don’t you have phones?”

anditshottoo Report

Thalidomide, which was a popular over the counter drug in the 60s, caused thousands of children to be born with severe birth defects as it was never properly tested before being released and was marked as safe for pregnancy.

They fought for years to not pay out and said every reported case was due to nuclear fallout and botched home abortions.

SailorVenus23 Report

This literally just happened yesterday. Disney released a new trading card game through a company called Ravensburger. A new set went on sale on their website yesterday morning, and the company once again didn’t prepare for the amount of traffic, so it crashed their queue system. Ravensburger then blamed it on a ddos attack instead of admitting they weren’t ready to handle the amount of traffic.

JebusKrizt Report

Not really a “company” per se but there was that time the Australian census site crashed on census night and the government blamed it on a targeted DDOS attack (also known as the entire population of Australia trying to access the same site at the same time).

anisetatlin Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes When Rockstar decided to remove about 200 vehicles from GTA Online and claimed it was to improve the user experience… that’s gotta be somewhere up in the top 100, at least?

otacon7000 , trenchophotography Report

I online ordered my groceries to be delivered. Eighty-eight items, fruit, milk, meat.

The groceries appeared on my doorstep, I went out to get them. Then I said “I expected more than th…. Hey, where is the milk? Where is the meat?”

So I go online, and the official explanation was that 57 out of 88 items were “unavailable”.

Nope. I guessed what had happened. The shopper had gotten like a third of the way done, and then stopped for whatever reason. Oh, and “WatTheHell. I’ll deliver what I have.”

But I called and asked about it anyway.

The response was in a “Idunno” voice. “Well, maybe that many items *were* unavailable.”

No way. The day that big store is out of milk, that will be a story on the town’s evening news.

OKQuiet_0416 Report

Venezuelan power company (destroyed by poor management, cronyism and corruption) blamed outages on an iguala getting on the cable 😂

sonysony86 Report

I had a flight booked with Delta from New York to Canada. I got an email a week before the flight was scheduled saying it was cancelled. No reason was given. I called the airline and the agent told me it was cancelled due to weather. A week beforehand. So I said to the agent, wow, you guys are really putting a LOT of faith in the meteorologists! Anyway I found out later that they cancelled the route and didn’t bother to tell customers or employees apparently…

KittensHurrah Report

Powerball

“We’ve listened to what people want, and that’s higher jackpots!”

The only way to do that is to increase the price or make it harder to win so the total goes up. Powerball did BOTH! from $1 to $2, a 100% increase, followed by extending the numbers to choose from. Doubling the cost and making it exponentially harder to win.

They duped everyone, and the only people who understand have taken statistics in college. It’s the fleecing of the ignorant.

ImCaffeinated_Chris Report

Pokemon saying they cut the national dex so they could focus on animations and balance, then continued to use the same models and animations while bringing back all of the most overpowered pokemon.

RSlickback Report

49 Times Companies Gave The Most Ridiculous Explanations For Their Mistakes MBMMaverick: Seriously? I paid 80$ to have Vader locked?
 
EA’s response:
The intent is to provide players with a sense of pride and accomplishment for unlocking different heroes.

As for cost, we selected initial values based upon data from the Open Beta and other adjustments made to milestone rewards before launch. Among other things, we’re looking at average per-player credit earn rates on a daily basis, and we’ll be making constant adjustments to ensure that players have challenges that are compelling, rewarding, and of course attainable via gameplay.

We appreciate the candid feedback, and the passion the community has put forth around the current topics here on Reddit, our forums and across numerous social media outlets.

Our team will continue to make changes and monitor community feedback and update everyone as soon and as often as we can.

One-Permission-1811 , Yan Krukau Report

Worked for a company that 3 divisions. Electrical construction (where I worked), armature, and maintenance.

Every year, the company would set projections, if income was kept in the black, and accidents to a minimum, every employee in each branch got a sizeable Christmas bonus check.

Ten or so years before I came on, one of the c-suites figured if they could keep that bonus… they got to keep the money. Just make up a reason the bonuses didn’t go out.

So the armature department got a letter saying “sorry, electrical went waaay over budget. Blame those a******s.” While maintenance got a letter blaming armature, and electrical got aimed at maintenance.

The departments were fairly independent, so thinking appeared to be that they’d all turn on each other, and C’s would pocket or “reinvest” what should have been bonuses (they knew something was fishy because that same year the CEO bought a nearly 1 million dollar boat, while the CFO could suddenly afford a 300k car)

What they forgot, however, was that construction workers gossip worse than hair stylists with a vendetta. So they all knew something shifty was up.

So next year, there were 20+ reported accidents. But no one knew who/where/how/what. So after about 4 years of being shady, the company just canceled the bonus program all together.

Megalon84 Report

“The one opinion, which I think is extreme, is represented by the NGOs, who bang on about declaring water a public right. That means that as a human being you should have a right to water. That’s an extreme solution. The other view says that water is a foodstuff like any other, and like any other foodstuff it should have a market value” – Peter Brabeck-Letmathe, former CEO of Nestle.

cyberdong_2077 Report

Lululemon’s founder, when confronted about the threadbare, see-through quality of his yoga pants claimed that it was women that were “bigger” shouldn’t use them because their thighs rub together, damaging the fabrics.

Nope, you just sell crappy, overpriced pants.

Snoo-96407 Report

QANTAS our national airline in Australia. They were booking ghost flights, flights they never intended providing. Taking bookings from people even after the flights had been cancelle total fraud, idea was to provide cheap flights then so people wouldn’t book flights with other airlines, then cancel them.

When called out on it Qantas said it’s customers understood that they weren’t booking a flight at a specific time to go to a specific destination but just booking and paying for a ticket.

Optus a major phone and internet provider here, whole system completely crashed, no phone internet, could not even make emergency calls. No explanation from Optus when service would resume no explanation on cause of failure.

Optus did say they had details on their website which people could access, but Optus customers could not of course as the internet and phone services were down.

FWFT27 Report

[China’s birth rate crisis is so intense that Nestlé is closing a baby formula plant due to dwindling demand](https://fortune.com/europe/2023/10/20/nestle-baby-formula-plant-ireland-close/)

Nestle: Demand in China is too low so we’re closing a factory in Ireland and moving production… to China.

I mean, I get that we all think John Q. Public is too dumb to analyze anything these days, but this is a blatant PR lie and Orwellian doublespeak.

thuper Report

The reason we’re not making any money is because our fans are toxic and sexist.

Shadow948 Report

I worked doing tech support in South Florida. After 9/11 our company changed the raise policy from quarterly to annually, dropped the top pay from $22 down to 15 and canceled the free laptop program. They claimed the cut backs were necessary due to 9/11 affecting our business.

12altoids34 Report

My property manager tried to get me to sign a contract saying I wouldn’t sue for anything I’d ever reported in the past, admitting that I was always late on rent (literally never have been), and that I agreed to pay 63$ to sign the contract.

The judge was not impressed with his explanation that the 63$ was for “special” fees because he had to write and print that farce.

Nillabeans Report

Even though someone posted something entirely anti-Semitic and our CEO said it was “the truth” it is being misreported that he himself is anti-Semitic.

OutrageousStrength91 Report

Probably the recent failure of the entire mobile phone network by Optus, the second largest provider in Australia. Many businesses lost money because their payment systems were down. The technicians at Optus were locked out of systems because they were on the Optus networks. The CEO just resigned over it.

The reason given for the failure was an upgrade being made by a “subcontractor.”

The “subcontractor” was Singtel in Singapore who owns Optus.

temmoku Report

An accident has occurred at the Chernobyl nuclear power plant as one of the reactors was damaged

G0es2eleven Report

Claiming I was incompetent and firing me when they had me doing a job with barely Any training and the training I did get was for a job I wasn’t doing.

When they really just over staffed themselves and didn’t want to pay the sign on bonus

Clumbsystoner Report


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5 Considerations for the Future of X Following Elon’s Anti-Advertiser Comments This Week

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X Deactivates Old Media Links Amid Changes to Back-End Elements

So what comes next for Elon Musk’s ambitious “everything app” now that he’s insulted those in charge of the platform’s key revenue stream?

Will X be forced to shut down? Will Elon pay out of his own pocket to keep it running? Can X possibly make enough from subscriptions to offset its ad losses?

There are a range of considerations, and while we don’t have all the answers (because only Elon and Co. have the full data), based on reported insights, here’s what we do know about how X is currently placed.

Will X go bankrupt?

Maybe. Again, we don’t have a full overview of X’s financial situation, because as a private company, it’s no longer required to report quarterly performance statements.

But we do know that X was already set to post a loss for FY 23 before this latest advertiser exodus.

Based on previous data reported by Twitter, the platform generated around $3.96 billion from ads in 2022. In September, Elon said that the company’s ad revenue has halved since he took over, due to concerns about his new direction for the platform, as well as broader market pressures, so we can assume, then, that before this latest ad pause, X had been on track to bring in around $2 billion in ad revenue for the year.

Which is still a lot, and even with a range of advertisers pausing their campaigns, that’s only going to impact this quarter, which, based on a recent report from The New York Times, will cost X around $75 million in ad revenue overall.

So the platform’s still likely on track to bring in around $1.9 billion for the year. Which is a lot less than what Twitter had been generating, but even so, that’s a lot of money that the company’s churning over. So it’s not exactly close to shutting down entirely, depending on costs.

Which is the other complexity in this equation.

In 2022, Twitter’s costs were set to exceed $5 billion before Musk took over at the app, with around $3.8 billion of that in staff costs alone. That’s why Elon set about his drastic cost-cutting plan, which included a cull of 80% of staff, shutting down regional offices, re-negotiating rent deals, closing down a key data center, etc.

We don’t know what the full impacts of these cost-saving measures has been, but we can estimate that, in combination, X’s costs may have been brought down to around $2 billion overall, though there have also been additional costs in GPUs for xAI and other elements that Musk and his team have implemented (it’s unclear if and how these costs are attributed to X Corp, and how that relates to X’s operating margins).

But for the sake of this exercise, let’s say that X’s costs are now $2 billion, and its income from ads is $1.9 billion or so. X is also seemingly on track to bring in an additional $650 million from subscriptions and data/API sales, so overall, even with this ad boycott, X is still looking okay, maybe.

But then there’s also the debt load that X took on as part of Musk’s takeover deal. In order to acquire the full funding for his $44 billion offer for the platform, Elon also took on debt that will cost X an estimated $1.2 billion per year in interest payments.    

So X is currently looking at income of around $2.5b for the year, and costs of $3.2b. Which means that any further loss will only compound this, and if advertisers stay away into the new year, things start to look pretty bleak pretty fast.

So, in summary, right now, for this year, X will probably be okay. But as the losses mount, by March next year, if things don’t turn around, X could be facing billions in losses, which may indeed end up putting it out of business.

Elon’s the richest man in the world, couldn’t he just keep X afloat with his own cash?

Probably, but it’s not necessarily as simple as it seems.

Elon does, of course, have access to billions in capital, and various means to raise more. But at the same time, he can’t just head to the bank and take out a few billion from the ATM to keep X going.

Musk has previously stated that the majority of his wealth is tied up in Tesla, SpaceX, The Boring Company, etc. So while he does have hundreds of billions to his name, he’s not necessarily liquid, and when he wants to cash out, there are processes that must be followed, and impacts as a result, so it’s not as simple as just paying it out of his personal wallet.

In order to find his purchase of Twitter, for example, Elon sold around $7 billion of Tesla stock. Which did not sit well with Tesla investors, who essentially then forced him to promise not to sell any more Tesla stock due to fears that it could tank the company’s value.

Musk also borrowed $1 billion from SpaceX around the time of his Twitter acquisition, which has since been repaid.

So, essentially, Musk can fund X as an ongoing project, but pumping billions into something with no return is not smart business, and won’t be as easy as just transferring Tesla money into X’s coffers.

Maybe other backers will help him, and be willing to take some hits, if Elon can sell them on a path to profitability. But again, telling your key revenue partners to “go f— yourself” is probably not going to win him a lot of corporate support, even from those who view him as a genius.

X is moving towards subscriptions, will that offset its ad losses?

No. Not even close, though that did, initially, seem like Musk’s ambition.

In November last year, shortly after Elon took over at Twitter, he outlined a vague plan to make subscriptions a key revenue driver, eventually accounting for 50% of Twitter’s overall revenue intake.

As per the above figures, that would mean that X would need to be bringing in more than $2 billion per year from subscriptions at its FY 2022 income levels, which equates to around 12 million paying subscribers at X’s highest priced subscription tier.

Thus far, however, X hasn’t even been able to convince a million people to pay for X Premium.

Though you can see the idea, conceptually, and why Musk thought that this was a viable option. Elon’s belief is that the majority of people support his “free speech” push in the app, and at 250 million+ daily active users, convincing just 5% of them to pay seems like an achievable target.

Evidently, that hasn’t been the case.

And while upping the cost of API access, and selling verification to brands has helped to bring in more supplementary revenue, it’s not close to bringing in anywhere near what X generates from ads.

Even at its now lower ad revenue intake, of around $2 billion for the year, its other income streams are far from generating 50% of its overall revenue.

Last month, X said that subscriptions and data sales now make up 25% of its overall intake, which seems like a positive, but that’s mostly due to X’s overall ad revenue declining so much, not its subscription intake increasing.

Will advertisers come back?

This, ideally, would be what X is aiming for, but Musk’s comments this week indicate that he’s not going to any effort to rectify the situation.

In fact, he’s actively pushing ad partners away, while also insulting publications and journalists, who have long been the key drivers of information flow in the app.

The disconnect here seems to be that Elon is associating advertisers abandoning his app with his own ideological view on what X is, and where it stands within the broader “free speech” debate.

This is evident when you look at Musk’s specific wording in his criticism of advertisers this week:

If somebody is going to try to blackmail me with advertising, blackmail me with money, go fuck yourself. Go fuck yourself. Is that clear? I hope it is.”

Musk’s view is that advertisers are trying to make X tow the line on perceived censorship, which is not actually what’s happening.

As articulated by YouTube star Hank Green:

Fortune 500 companies aren’t overly moral actors. They make decisions based on whether they think they will make more or less money. Advertisers are not leaving Twitter because they are trying to make a statement or achieve some goal (which would be a boycott). They are leaving Twitter because they aren’t sure whether advertising on the platform is delivering negative or positive value, and why spend a bunch of money doing something that might actually be hurting you.”

Musk’s viewing this from an ideological standpoint, but as Green notes, his business partners are worried about their respective brand value, not controlling what can and cannot be said.

That misunderstanding is at the core of Musk’s defiance, and his stance against advertiser pressure.

Will Elon see it that way, and look into potential failings in the platform’s ad serving system, and indeed his own comments, and how they represent X as an entity?

It seems, at this stage, that Elon is determined to make a stand, that he will not be silenced, even if what he shares is wrong/misinformed/harmful, etc.

That being the case, I’m not sure how Yaccarino and her team are going to be able to pitch ad partners on an improved situation moving forward.

How long does X have?

Well, all of this, of course, is variable, and dependent on a range of factors along the way.

Maybe, Elon does decide that he wants to work with ad partners, and improve the situation, and maybe that then secures X’s user base, and brings back ad partners as a result. X still has hundreds of millions of active users, and offers significant advertising opportunity as a result, so there is still a chance that X can turn things around once again.

But right now, most of X’s growth plans are still vague, while Elon has shown no interest in re-aligning the platform in this respect.

X is looking to implement payments, but is years away from making this a reality. And even if does bring payments into the app, why would people use such a service?

X is rolling out its Grok AI chatbot to more users, but most people already use ChatGPT, and there’s not really a significant differentiation between AI chatbots to make this a more attractive option.

X has added jobs, is looking at dating, and is pushing for more long-form text and video content, all of which is already available in more fully-formed, functional offerings in other apps.

With no big, game-changing advances on the horizon, and Elon standing firm on his advertising stance, I imagine that X could be in significant trouble by March next year, as its Q1 results will show just how far off it is, and how much of a loss it’s facing as a result.

X won’t necessarily report this publicly, but that’s when you’re likely to see more cost-cutting from the app, which will be a signal that it’s in serious trouble. And given that Musk has already cut most elements to the bone, it may well be staring down a massive loss, which could see it considering bankruptcy mid next year.

Things might change, X might re-assess its stances, and this could end up being a blip in its longer-term trajectory. But right now, Elon seems determined to die on his “free speech” hill, cheered on by his many fans, who hang on his every utterance, desperate for his acknowledgment in any form.

If those are the people Musk really wants to impress, then X may well end up being the cost.

And right now, Elon seems just fine with that.  



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With outburst, Musk puts X’s survival in the balance

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Even after Elon Musk gutted the staff by two-thirds, X, formerly Twitter, still has around 2,000 employees, and incurs substantial fixed costs like data servers and real estate

Even after Elon Musk gutted the staff by two-thirds, X, formerly Twitter, still has around 2,000 employees, and incurs substantial fixed costs like data servers and real estate
– Copyright POOL/AFP/File Leon Neal

Thomas URBAIN

Elon Musk’s verbal assault on advertisers who have shunned X (formerly Twitter) threatens to sink the social network further, with the tycoon warning of the platform’s demise, just one year after taking control.

“If somebody’s gonna try to blackmail me with advertising, go fuck yourself,” a visibly furious Musk told an interviewer in New York in front of an audience of the US business elite this week.

Musk was lashing out at the advertisers who had abandoned his platform after Media Matters, a left-wing media watchdog group, warned big companies that their ads were running aside posts by neo-Nazis.

Walmart on Friday was the latest to join the exodus, following the footsteps of IBM, Disney, Paramount, NBCUniversal, Lionsgate and others.

The latest controversy broke earlier this month when Musk declared a tweet exposing an anti-Semitic conspiracy theory as the “absolute truth.”

Musk apologized for his tweet, even taking a trip to Israel to meet with Prime Minister Benjamin Netanyahu, but on Wednesday he targeted his anger squarely at advertisers.

“It doesn’t take a social media expert to know that publicly and personally attacking the people in companies that pay X’s bills is not going to be good for business,” said analyst Jasmine Enberg of Insider Intelligence.

“Most advertiser boycotts on social media companies, including X, have been short lived. There’s a potential for this one to be longer,” she added.

Musk said the survival of X could be at stake.

“What this advertising boycott is going to do is kill the company,” Musk said.

“Everybody will know” that advertisers were those responsible, he angrily added.

– Bankruptcy looms? –

Even before the latest bust up, Insider Intelligence was forecasting a 54-percent contraction in ad sales, to $1.9 billion this year.

“The advertising exodus at X could accelerate with Musk not playing nice in the sandbox,” said Dan Ives of Wedbush Securities.

According to data provided to AFP by market data analysis company SensorTower, as many as half of the social network’s top 100 US advertisers in October 2022 have already stopped spending altogether.

But by dropping X, “you are opening yourself up for competitors to step into your territory,” warned Kellis Landrum, co-founder of digital marketing agency True North Social.

Advertisers may also choose to stay for lack of an equivalent alternative.

Meta’s new Threads platform and other upstarts have yet to prove worthy adversaries for the time being, Landrum argued.

Analyst Enberg insisted that “X is not an essential platform for many advertisers, so withdrawing temporarily tends to be a pretty painless decision.”

Privately held, X does not release official figures, but all estimates point to a significant drop in the number of users.

SensorTower puts the annual fall at 45 percent for monthly users at the start of the fourth quarter, compared with the same period last year.

Added to this is the disengagement of dozens of highly followed accounts, including major brands such as Coca-Cola, PepsiCo, JPMorgan Bank and Starbucks as well as many celebrities and media personalities that have stopped or reduced usage.

The corporate big names haven’t posted any content for weeks, when they used to be an everyday presence.

None of the dozen or so companies contacted by AFP responded to requests for comments.

In normal conditions, Twitter or X “was always much larger than its ad dollars,” said Enberg.

It was “an important place for brands and companies to connect with consumers and customers,” she said.

Even after Musk gutted the staff by two-thirds, X still has around 2,000 employees, and incurs substantial fixed costs like data servers and real estate.

Another threat is the colossal debt contracted by Musk for his acquisition, but now carried by X, which must meet a payment of over a billion dollars each year.

In his tense interview on Wednesday, Musk hinted that he would not come to the rescue if the coffers run dry, even if he has ample means to do so.

“If the company fails… it will fail because of an advertiser boycott and that will bankrupt the company,” Musk said.

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