The rapid decline of Twitter is the result of a false foundation on free money and fake advertisers rather than user-subscriptions.
At least six executives have reportedly resigned from Twitter this week. The social media platform’s new owner, Elon Musk, called an all-hands meeting on Thursday, announcing a return to office hours and mentioning the possibility of bankruptcy unless the company can find a way to become profitable.
Among the departures was the head of safety and moderation, Yoel Roth, Bloomberg reported, citing insider sources. Musk had kept Roth on despite complaints from conservatives that he had been responsible for much of the political censorship on the platform – one of the reasons the Tesla and SpaceX CEO cited for buying the company.
“The economic picture ahead is dire,” Musk wrote in an email calling the meeting, according to the New York Times. “Without significant subscription revenue, there is a good chance Twitter will not survive the upcoming economic downturn.”
Unless Twitter can generate profits from its $8 monthly Blue program, bankruptcy is a very real possibility, Musk reportedly said, adding that the platform is currently too dependent on advertising.
All of the social media giants are, to greater and lesser degrees, fraudulent corporate structures. They are not actually real businesses as one learns about business in business school or Econ 101. Their nominal customers are not their customers, but rather, their “advertisers”, who are not actually advertisers as one is taught in Marketing 101, but Clown World conduits for free money provided to ticket-takers. They are totally – and I mean TOTALLY – dependent upon a constant flow of external “investment” money. In most cases, the total “investment” into them far exceeds their actual revenue.
For example, Patreon’s peak monthly payout, in July 2022, is $26 million. Since they take an average of 6 percent, this means their average monthly revenue is around $1.6 million. Ergo, their peak annual revenue is around $20 million and their total lifetime revenue from 2013 is around $60 million, while as of one year ago, Patreon had received $413.3 million in funding over 10 rounds. This strongly suggets that Patreon is not, and never will be, a viable business under its current revenue model. The same is true of Twitter and other public companies propped up by various forms of “investment”; rising interest rates and falling stock prices mean that the flow of money these corporations require to operate is beginning to dry up.
This is why UATV and Arktoons have been subscription-based from the start. And this is why it is so important to subscribe to at least one service, because it is the only foundation that is real and capable of keeping things going over an extended period of time.
As a community, we have an amazing opportunity here. The corporate fakes and frauds that have siphoned up all of the public awareness by providing “free” services are beginning to crumble. As with the Great Depression, the giants of the 2060s and beyond will be the agile and determined operations that survived and thrived during the Great Collapse.