Could Elon Musk Make Twitter A Web3.0 Company?

Twitter
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stock is expected to stop trading on the New York Stock Exchange on Friday as Elon Musk looks to close the $44 billion deal to buy the social media company. On Wednesday, he posted a video of himself walking into Twitter headquarters carrying a ceramic sink and captioned it “Entering Twitter HQ – let that sink in!”. This was a strong indication that he was willing to honor the court order to buy Twitter before the October 28 deadline.

Twitter is currently classified as a Web2 firm. Web2.0 companies are primarily associated with internet platform centralization, data mining for ad-based revenue, extremely high take rates, dynamic data processing and integration, and vibrant internet communities.

Developments in Web2.0 made it possible to create Facebook, Google, Twitter, Instagram, Snapchat, Amazon
AMZN
, Paypal, Tiktok, and many other platforms that we use today. These Web2.0 companies have integrated the world and made it easier to interact, transact, create content, process data, and make the internet experience better.

Web2.0 companies led to what I would describe as too much centralization, which created a plethora of challenges and criticisms. First, the take rates were too high and the stakeholders on Web2.0 platforms made pennies after creating all the content while the owners made billions of dollars off that content. According to Andreessen Horowitz (a16z) in its 2022 state of crypto report, “You know something is profoundly wrong with our economy when Big Tech has a higher take rate than the mafia.” the report quoted.

According to the report, Facebook, Instagram, and Twitter have an estimated 100% take rate. This means that the platforms profit from almost all content created without compensating the creators. YouTube, on the other hand, has a take rate of 45%. This means that YouTube takes 55% of the ad revenue generated by YouTube content.

Elon Musk recently praised Twitter for providing a platform for citizen journalism free of establishment bias. This could be interpreted as him understanding the value they bring to the platform and, as a result, wanting to give something back.

Back in April, Elon suggested a couple of changes to Twitter that suggested dropping the ad-based revenue and focusing on affordable subscriptions on Twitter Blue, a new Twitter feature that allows a subscription model.

Web3.0 is often associated with value for creators and communities on a platform. Twitter Blue allows the community to subscribe to the Twitter Super Follows feature that rewards their preferred content creators.

Today, Elon tweeted an open letter to advertisers, stating that he will not abandon ad-based revenue. He clarified that some ads, when done well, can contribute to quality content, whereas others can contribute to Twitter’s massive spam problem. He reiterated Twitter’s goal of becoming the most respected advertising platform.

Web3.0 is largely attributed to blockchain platforms and NFTs. With Twitter already supporting NFT profile pictures, it requires only a couple of tweaks to become a truly impactful Web3.0 company.

In September, Justin Taylor, Twitter’s head of consumer product marketing, announced a project that would allow users to verify NFTs and display their collection of NFTs on their profiles.

To make Twitter a truly free social media site, Elon proposed moving away from ad-based revenue because corporations advertising on the platform have a direct influence on Twitter policy. He proposed a $2 monthly subscription, payable annually, with the option of paying in dogecoin. In June, while speaking at a hands-on meeting for Twitter, Elon stated that money is fundamentally digital at that point and has been for some time. He argued that integrating payments into Twitter to allow for the sending and receiving of value would make a significant difference.

Web3.0 platforms are largely touted for their possibility to involve the community or stakeholders in decision making. While it is not clear whether Elon will allow Twitter users to vote on proposed changes, he has evidently used Twitter polls to get community insights for some of his recent ideas. For instance, in April, he conducted a Twitter poll asking his followers to vote on whether they wanted a Twitter edit button. The poll got 4.4 million votes, with 73.6% voting yes. Besides this, he has recently run more polls to get community insights.

Elon Musk recently demonstrated Optimus, a humanoid robot, and is very aggressive in developing AI technology. With this Twitter acquisition, there’s no telling if he wouldn’t use AI to combat the bots that have plagued the Twitter experience for months. Web3.0 is also closely associated with the use of artificial intelligence to improve products, user experience, security, and data privacy.

Elon Musk is the founder and CEO of Starlink, a low-Earth orbit satellite constellation system that aims to provide global internet coverage. If he decides to decentralize Twitter through this infrastructure in the future, he could use AI and machine learning to learn from Twitter’s massive database of Tweets to build a truly semantic web platform that qualifies as the ultimate Web3.0 company.