Mark Zuckerberg launched a new social media platform through Instagram called “Threads,” which analysts believe could threaten Twitter. Threads, a standalone app that allows users to log in with their Instagram credentials and follow the same accounts, is seen as a potential “Twitter-Killer” that could siphon ad dollars from the microblogging platform. While Meta aims to attract social media influencers and capitalize on early buzz, some analysts remain skeptical about whether Threads can successfully lure avid Twitter users away.
By Katie Paul; July 5, 2023
NEW YORK, July 5 (Reuters) – Meta’s META.O Mark Zuckerberg is set to deliver a blow to Elon Musk on Wednesday night, as the tech billionaires’ rivalry goes live with the launch of Instagram’s much-anticipated Threads platform, a clone of Twitter.
Analysts said investors were salivating over the possibility that Threads’ ties to Instagram might give it a built-in user base and advertising apparatus, which could siphon ad dollars from Twitter as its new CEO tries to revive the microblogging company’s struggling business.
While Threads is launching as a standalone app, screenshots posted on Apple’s App Store showed that users would be able to log in using their Instagram credentials and follow the same accounts, making it an easy addition to existing habits for Instagram’s more than 2 billion monthly active users.
“Investors can’t help but be a little excited about the prospect that Meta really has a ‘Twitter-Killer’ poised to launch on the app store,” said Danni Hewson, head of financial analysis at investment platform firm AJ Bell.
Meta stocks closed up 3% on Wednesday ahead of the launch, outpacing gains by competitor tech companies as the broader market edged down.
Threads’ arrival comes after Zuckerberg and Musk have traded barbs for months and even threatened to fight each other in a real-life mixed martial arts cage match in Las Vegas.
The timing is opportune for Meta to deliver a blow, as months of Musk’s chaotic decision-making has roiled Twitter, said Matt Navarra, a social media consultant who has worked with Meta, Google and Pinterest.
Musk bought Twitter for $44 billion last October, but its value has since plummeted as it faced an exodus of advertisers amid deep staffing cuts and content moderation controversies.
While Meta is likely to focus first on growing users before incorporating advertising on Threads, “there will be big brands that will happily (invest) a good amount of ad spend on the platform” to capitalize on early buzz, said Navarra.
“It’s going to be more palatable and brand safe than what’s being offered over on Twitter,” he said.
To build up Threads, Meta has been making overtures to social media influencers to attract them to the new app and encouraging them to post at least twice a day, said Ryan Detert, CEO of influencer marketing company Influential.
The app also benefits from the failure of other would-be Twitter competitors to take advantage of the service’s stumbles. While a number of new and burgeoning competitors such as Mastodon, Post and T2 have tried to lure Twitter users away, all remain relatively small so far.
Bluesky, a new service backed by Twitter cofounder Jack Dorsey, launched its invite-only beta in February and instantly created buzz on Twitter, with users clamoring to get access codes. Its website says it has 50,000 users. Dorsey has also backed another platform called Nostr.
But history is working against Meta. It has suffered multiple failures launching standalone copycat apps in the past, most notably its Lasso app aimed at competing with short video rival TikTok.
The company later incorporated a short video tool directly into Instagram and more recently wound down its unit tasked with designing experimental apps as part of a cost-cutting drive.
Another potential strike against Threads is that the news-oriented culture on Twitter is different from that on Instagram, a more visual platform, said Jasmine Enberg, principal analyst at Insider Intelligence.
“The main use cases for Twitter still remain keeping up with news and world events,” said Enberg. “I find it hard to imagine that the most avid loyal Twitter users who go to Twitter for that type of culture will defect and go immediately to Threads.”
Still, she said, Meta only needs to convince a quarter of Instagram’s users to join Threads in order to rival Twitter’s size. “The reality is that Meta doesn’t need to convert Twitter power users into Threads users.”
Photo: Sky News