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Twitter Poised to Unveil $3 Per Month Subscription Plan

By Rich Duprey - May 17, 2021 at 10:16AM

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A tiered paid model has been in the works for some time.

A Twitter (TWTR -1.10%) paid subscription service is quickly approaching. App researcher Jane Manchun Won tweeted on Saturday that the social media service is preparing to roll out a $3 per month subscription model called Twitter Blue that would offer users exclusive services such as saving and organizing favorite tweets as well as undoing tweets.

CEO Jack Dorsey said last year that Twitter was exploring the idea of a subscription model. And following its acquisition of Scroll earlier this month, product vice president Mike Park wrote on the company's blog that Scroll, an ad-clearing publishing outlet, "will become a meaningful addition to our subscriptions work as we build and shape a future subscription service on Twitter."

It's clear that as Twitter user growth stagnates, the need to find other avenues for monetizing the service is essential.

Twitter feed on mobile devices
Tweet symbol

Image source: Getty Images.

Twitter posted better-than-expected first-quarter revenue and earnings growth in April, as advertising revenue surged 32% year over year to almost $900 million. User growth, though, was lower than expected, rising only by 7 million sequentially. And with Apple requiring apps to seek user permission first before tracking their online browsing habits, Twitter forecasts its ad sales will suffer a "modest impact."

The subscription model could help the tech stock offset that decline. Wong, who reverse-engineers apps to see what services they might be preparing, tweeted over the weekend that Twitter Blue would also have subscription tiers, with higher rates offering more services, such as a less-cluttered news reading experience.

Whether Twitter will then amplify the tweets more from people who paid is unknown, but it would seem a way to entice influencers and brands to sign up, though that might contribute to degrading the overall experience for users of the free service. Twitter did not comment on the reports.

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple and Twitter. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.

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