Whether or not the gimmicky cage fight between Meta’s Mark Zuckerberg and Twitter’s Elon Musk happens, a brawl between the two is already on. And there is a lot more at stake than mere bragging rights for the winner. Just 18 hours after the launch of “Twitter killer” Threads on Thursday, Meta’s text-based social networking offering had clocked 30 million sign-ups. And based on the number badges on Instagram profiles of users, reports SEJ, the number seemed to have shot past 55 million by mid-Friday. Threads profiles are tied to Instagram accounts, requiring users to have the same username for both services. Even if Twitter were doing fine—and it certainly doesn’t seem to be the case—that number alone should be giving Musk a lot of heartburn. Musk also hasn’t exactly inspired advertisers’ and users’ confidence with his handling of Twitter with decisions that have baffled most industry watchers. By his own reckoning, the company’s valuation is now down to a third of what he paid for. Many saw the appointment of a new CEO as the tonic Twitter needed, but there is now a Threads-sized question over its survival.
Twitter hasn’t released daily active user (DAU) numbers after Musk’s takeover, and pre-Musk, there were 238 million. This means Threads had already reached close to a quarter of that mark within two days of its launch. Instagram has over 500 million DAUs and 2 billion monthly active users. Of course, the proof of the pudding would be in how many stick and turn Threads truly into a Twitter killer. But, for now, its momentum certainly has portents for the popular microblogging platform.
The phenomenal response to Threads, however, doesn’t mean it is all ‘advantage Zuckerberg‘. He seems to have miscalculated earlier, putting most of Meta’s eggs in the metaverse basket much too soon. The company even rebranded in 2021 to project its virtual reality offering as its number one priority, and burnt billions of dollars in its rush. The enthusiasm has since cooled even if it has not completely died out. It had to sack 11,000 employees—13% of its work-force. Of course, its first quarter revenues for 2023 beat market expectations, and stock prices shot up, but net income was down 24%. It has since pivoted towards artificial intelligence, which every tech-forward company is betting on. But, others, including Microsoft, are only widening their lead on AI, and the virtual reality/augmented reality space is getting crowded too, with Apple’s Vision Pro being one of the latest entrants.
So, Meta must go back to its old workhorse, social media, to shore up earnings in the interim and in the long run. Given a lacklustre Facebook and peaking Instagram, Threads could prove to be a big part of the plan when it does turn to advertising revenue. But, only if its momentum sustains and it is able to offer more than Twitter soon enough. That’s a big if. At the moment, there are unique offerings but there are no hashtags and directs messages, unlike Twitter. It is also yet to enter the EU market, as it is figuring out how to be compliant with the strict privacy rules there. Had it been only a cage fight, neither of two billionaires would have truly lost—after all, no one has died of an injured ego. But, Twitter versus Threads is the real brawl. Zuckerberg knows that despite his seemingly “jabs in jest” aimed at Musk. And Musk does so too, as Twitter’s threat to sue Threads for alleged IPR violations shows.