Launched a year ago, Meta Platforms Inc.’s Threads was Mark Zuckerberg’s strategic move to capitalize on the challenges faced by Elon Musk’s X, formerly known as Twitter. This long-standing feud between two of the world’s wealthiest individuals has evolved into a significant business rivalry, set to intensify as Threads prepares to introduce ads in its feed.
In July 2023, amidst user concerns over Musk’s changes at X, Meta swiftly brought Threads to market, directly challenging its competitor. The service, resembling X with features like likes, followers, and a user interaction-based feed, now boasts over 175 million monthly users, up from 150 million three months prior. While still smaller than X, Threads is rapidly gaining traction and surpasses other platforms like BlueSky and Mastodon, which emerged following Musk’s acquisition of Twitter.
Threads has introduced numerous notable features and attracted celebrities, journalists, and politicians, enhancing its reputation as a hub for breaking news. Instagram head Adam Mosseri aims to position Threads as a competitor for advertising dollars. X’s ad revenue saw a significant decline, estimated at 45% in 2023 compared to two years earlier, due to advertisers’ concerns over Musk’s reduced content moderation and unpredictable behavior.
Threads’ ads would provide an alternative for businesses familiar with Meta’s successful ad products on Instagram and Facebook. Mosseri expressed eagerness to implement ads on Threads, emphasizing the potential benefits for business growth. He highlighted that Threads plans to offer more targeted and personalized ads than X, leveraging Meta’s robust advertising capabilities.
Meta’s advertising revenue, which reached $135 billion last year, dwarfs X’s estimated revenue by nearly 40 times. Mosseri noted that while Twitter focuses on brand-oriented advertising, Meta’s approach emphasizes direct response ads, aiming to drive specific outcomes like product sales or app downloads. He anticipates that Threads will feature more relevant and engaging ads compared to X.
Opportunity Amidst Chaos
The success of Threads over the past year was not guaranteed. While Zuckerberg has successfully replicated competitors’ features, such as Snapchat’s Stories and TikTok’s short-form videos, Meta has struggled with standalone app development. However, Threads presented a unique opportunity. Following Musk’s takeover of Twitter in late 2022, Meta’s top executives saw an opening to capitalize on the turmoil at Twitter.
As Musk laid off half of Twitter’s staff, discussed bankruptcy, and lost major advertisers wary of his “free speech” agenda, Meta’s team recognized the potential for Threads. Twitter’s history of problematic content, including hate speech and misinformation, raised concerns among marketers about unchecked posts under Musk’s leadership.
Instagram was already developing a new feature called Channels, designed to function like a one-way private message to a user’s followers, similar to an email blast. However, Channels didn’t seem like a strong competitor to Twitter.
During a late-night call, while on an anniversary trip to Italy, Adam Mosseri suggested to Mark Zuckerberg that Meta should directly challenge Twitter with a similar product. Zuckerberg liked the idea, and the team decided to quickly build a new text-focused social network.
“The idea was to have something launchable as quickly as possible, but not to launch it until it was ready,” Mosseri explained. “Unless something wild happened over at Twitter.”
On July 1, Elon Musk announced that Twitter would limit the number of posts users could read daily, aiming to combat data scrapers and encourage subscriptions to his $8-per-month service. This decision caused widespread outrage among Twitter users. Mosseri, who had planned a one-month sabbatical, canceled his plans.
The Threads team rushed to launch the app, unveiling it on July 5, a month earlier than planned. (Musk later reversed the decision to limit daily post access.)
“There should be a public conversations app with 1 billion-plus people on it,” Zuckerberg wrote in a Threads post after its launch. “Twitter has had the opportunity to do this but hasn’t nailed it. Hopefully we will.”
A Political Strategy
While Zuckerberg hasn’t yet perfected Threads, he has come closer than anyone else. Meta has struggled to clearly define Threads’ purpose, a challenge Twitter also faced for years.
Despite its similarities to Twitter, Threads aims to create a different atmosphere. “We wanted to make it a less angry space,” Mosseri said.
This difference is noticeable to many users, with mixed reviews. Some miss Twitter, while others appreciate the change. Tim Fullerton, a digital marketing executive and former campaign staffer for Barack Obama, noted that Threads users want a community-focused platform, not one centered on broadcasting.
Threads appears ready to diverge from Twitter, especially regarding political news. While political posts are shown to followers, Threads won’t proactively recommend them to others. This approach makes it harder to gain attention or build a following through political content.
“We don’t think it’s our place to amplify political news,” Mosseri explained, citing topics like abortion, the Gaza conflict, and the US presidential election. “We don’t think it’s our place to show you a hot take on a political issue from an account you do not follow and therefore you did not ask for it.”
“We think that comes along with too many problems to be worth any potential upside there might be on engagement or revenue,” Mosseri added.
Despite this, Mosseri insists that Threads remains a platform for news outside of politics, aiming to keep users informed about current events as they happen. However, Threads has sometimes been slow to display posts about breaking news, occasionally showing updates days after events have occurred.
The challenge for Threads is to establish itself as a digital town square for news while managing political content. Although tech companies like Meta and Twitter argue that political posts are a small fraction of their content, these discussions are often the most urgent and engaging.
Political discourse has been a hallmark of X, especially during former US President Donald Trump’s tenure, where he frequently posted updates. While reducing political news might make Threads a “less angry” space, Mosseri acknowledges that this approach has its drawbacks.
“I think we are going to give up some of that relevance, some of that attention, some of that business,” he said. “And that’s OK.”