Elon Musk turned to a small circle of friends and acquaintances with little or no experience running a social media company to determine the optimal price for Twitter Blue before it reached $8 a month, an amount he said people would typically pay. for a cup of Starbucks to an upcoming book written by New York Times reporters Kate Conger and Ryan Mack.
A New York Times story adapted from “Character Limit: How Elon Musk Destroyed Twitter,” which documented the billionaire’s chaotic October 2022 takeover of the company, details how Musk decided on the pricing of Twitter Blue, a subscription service that provides users exclusive features and blue tick.
The feature has since been rebranded to X Premium.
Fresh from buying Twitter for $44 billion, Musk began discussing Blue’s pricing with people in his orbit, including venture capitalist David Sachs, tech podcaster Jason Calakanis and author Walter Isaacson, who followed Musk for his biography of the billionaire, according to the excerpt.
The new owner of Twitter received several offers.
Sachs argued that the price of Twitter Blue should be increased from $4.99 to $20 per month.
“Chanel could make a fortune selling a $99 bag, but that would be a one-time move,” Sachs wrote in an email reviewed by the Times. “A ‘promotional offer’ may not be the position we want. A luxury brand can always move down the market, but it is very difficult to move up once the brand is shot.”
Calacanis, a friend of Musk, offered $99 a year. According to the excerpt, he thinks the double-digit price will attract more users than if Twitter charged $100 a year.
Musk also turned to his biographer Isaacson.
“This should be available to everyone,” Isaacson told Musk, according to the excerpt. “You need a really low price because it’s something that everybody will sign up for.”
Sachs, Calacanis, Isaacson and a spokesman for X did not respond to a request for comment.
According to the excerpt, Musk almost agreed to charge users $100 a year until his close aide, Jen Balajadia, argued that the service should be more affordable.
“There are a lot of people who can’t even buy gas right now,” Balajadia said at a meeting, according to two sources who spoke to Times reporters.
“You know, like, how much people pay for Starbucks? Like $8?” Musk asked, according to the excerpt.
Musk then pulled out his phone and tweeted on November 1, 2022: “The current Twitter lords and peasants system of who has or doesn’t have a blue tick is bullshit. Power to the people! Blue for $8/month.”
About a year later, Twitter was rebranded as X, and the company had between 950,000 and 1.2 million premium subscribers — less than 1 percent of its total user base, Bloomberg reported, citing an analysis by an independent researcher.