Social media magnate Mark Zuckerberg is proud to announce the release of Meta's newest app called 'Threads' - Zuckerberg's substitute for Twitter.
The app has had a great first launch, amassing 30+ million user sign-ups in less than a day.
With this traction, Meta has a considerably serious chance of wooing a portion of its 3 billion users across all their social media platforms, such as Facebook, Instagram, and WhatsApp combined.
This photo illustration created in Washington, DC, on July 6, 2023, shows an image of Elon Musk reflected in the opening page of Threads, an Instagram app.
Expected Revenue
'Threads' won't contain advertisements at first, according to Zuckerberg, allowing their team first to improve the app's text-based post-scrolling functionality. The company's strategy is to ensure the software functions properly and gain at least 1 billion users before considering making advertisement revenue.
Justin Patterson, an analyst at Meta's equities research firm, hypothesizes that 'Threads' adverts may increase Meta's profits between 1%-5%, or up to over $6 billion in the most favorable scenario. Meta, affiliated with Twitter and aims to counteract Apple's harsher privacy regulations, produced over $4.5 billion in ad income in 2021, right before Musk took control of the company.
Read Also: Meta's Threads App Privacy Concerns Rise as Sensitive Data Collection Revealed
Attracting Users
Musk vowed to sue Meta for allegedly stealing trade secrets, but users' frustration towards Twitter made him want an alternative. According to Insider Intelligence analyst Jasmine Enberg, Meta's promise of a "saner, kinder place" has increased early sign-ups. Success relies on converting power users of Twitter or people who have never downloaded the service.
Threads' momentum must be kept up by Meta, as newshounds and Twitter stalwarts are unlikely to go. According to Ms. Enberg, Zuckerberg, well-known for his imitation goods, has had difficulty coming up with new ideas.
Security Hazards for Adverts
Advertisers are drawn to Instagram's fashion and lifestyle content, but it's debatable whether the world needs another venue. Due to customer preferences for less material on his platforms, research indicates that Zuckerberg's relationship with news is problematic. Instead of compensation for news sources for their material, his firm intends to censor local reporting in Canada.
Other than that, advertisers also want confidence that their money is not going on platforms with privacy and misinformation hazards. With changes to content control and a new cap on audience submissions, Twitter has alienated marketers under Musk's direction.
Meta shares jumped 4% on Wednesday, ahead of the launch, indicating investor confidence in Zuckerberg's ability to succeed. However, it will be challenging to replicate news breaks on Twitter, providing opportunities for both platforms to operate continually. Musk may receive a "wake-up call" in the event of this significant threat. It will be crucial to how long 'Threads' avoids advertising since Twitter needs to correct its errors.
Before 'Threads' launched, Meta shares increased, demonstrating the high level of investor confidence in Zuckerberg's achievement. Its effects on Twitter's future are still unknown. If Threads retains its appeal, that will be the deciding factor in the upcoming months.
Related Article: Threads Amasses 10 Million New Users in Just 7 Hours
