this post was submitted on 30 Jun 2023
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Asklemmy
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Twitter had experimented and had a fair system in place through previous trial and error. Elon thought it wasn't good enough and then ran into the wall face-first thinking he was smarter than the average guy. Spoiler: he wasn't.
Elon is a dufus. But Twitter burned about half a billion per year before being aquired. Those silicon valley companies are unprofitable zombies for decades without it's users even realizing that the service won't be free forever. They continue eating through borrowed venture capital and investment rounds (expecting returns). Having to charge a price for your service is ok, but it's harder after it was free & doing it without an explanation. It's a given that reddit is still very much unprofitable but their PR would be in a much better position if they were more transparent instead of just dictating changes & terms to their volunteers.
People overstate how bad Twitter's financial situation was prior to Elons takeover. They lost 500 million but had 5 billion in revenue. While not great with strategic cost cuts and a little investment in improving the ad platform they probably could have become profitable. Probably not enough to satisfy their investors but profitable.
Elon saddled them with so much debt and has become hostile to advertisers I doubt that they will ever be profitable now.