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: Tech CEO says Twitter needs to go ‘all in’ on subscriptions

0

Twitter’s days as a completely free platform could be ending.

According to comments made by CEO Jack Dorsey at the virtual Goldman Sachs Technology and Internet Conference on Feb. 10, 2021, subscriptions and other forms of payments could be coming to Twitter.

“The first thing we want to focus on is that economic incentive to people who are contributing to Twitter,” Dorsey, who is also the CEO of the digital payments company Square
SQ,
-5.13%
,
said at the conference. “That can come through a regular subscription, that can come through content unlock, that can come through tipping. There is a host of things and right now we are just studying and prioritizing what those things look like.”

Twitter
TWTR,
-0.33%

has been free to join since it was founded in 2006.

Twitter recently announced plans to purchase Scroll, a subscription service that lets people read articles from various news sources without advertisements.

The company has already begun making moves in the subscription world. In January, Twitter acquired newsletter service Revue, which allows creators to get payments directly from their Twitter audience — Revue takes a 5% fee for paid newsletters.

See also: Elon Musk asked Twitter for ‘SNL’ sketch ideas. Guess how that went?

Some think Twitter should make subscriptions a major component of their business plan, including Dan Burkhart, the CEO of Recurly, a company that provides billing subscription services for companies. Burkhart told MarketWatch he thinks Twitter should go “all in” due to the company’s unique structure.

“The top voices on Twitter end up driving orders of magnitude more traffic engagement than the rank and file,” Burkhart told MarketWatch. “When you have a product like that with such vast reach…with so many pockets of interest groups that create the peaks and valleys that is far and wide, you have the ability to stratify your sources of revenue.”

Burkhart cited positive investor reactions from subscription companies like Petco
WOOF,
+0.71%
,
Snowflake
SNOW,
-2.36%

and Lemonade
LMND,
-2.94%

as proof there has never been a better time to build around subscriptions. All three companies went public in the past 12 months, and subsequently posted strong openings.

One of the payment features that Twitter’s Dorsey mentioned recently was tipping, something Burkhart agreed could work for the platform.

“There’s absolutely room for membership-based access to premium content, and tipping is a nice degree of freedom off that.”

Recurly, which provides billing services for large subscription companies like Twitch TV, Showtime and BarkBox, also works with Twitter on a small portion of its ad products.

The social media giant posted revenue north of $1 billion on its latest earnings call, a 28% increase year over year. Twitter shares have gained 50.5% over the past month, as the S&P 500
SPX,
-0.67%

 has risen 1.53%.

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