Elon Musk reached out to a small circle of friends and acquaintances with little or no experience running a social media company to decide on the optimal price for Twitter Blue before settling on $8 a month — an amount he thought people typically paid for a cup of Starbucks, according to a forthcoming book by New York Times reporters Kate Conger and Ryan Mac.
A New York Times article adapted from “Character Limit: How Elon Musk Destroyed Twitter,” which documents the billionaire’s chaotic October 2022 takeover of the company, details how Musk decided on the price of Twitter Blue, a subscription service that gives users exclusive features and a blue check mark.
The feature has since been renamed X Premium.
Fresh off his $44 billion purchase of Twitter, Musk began discussing Blue’s pricing with people in his circle, including venture capitalist David Sacks, tech podcaster Jason Calacanis and author Walter Isaacson, who was following Musk for his biography of the billionaire, according to the excerpt.
Twitter’s new owner has received some suggestions.
Sacks argued that the cost of Twitter Blue should be increased from $4.99 to $20 per month.
“Chanel could make a fortune selling a $99 bag, but it would be a one-time deal,” Sacks wrote in an email seen by The Times. “A ‘promotional deal’ may not be the position we want to be in. A luxury brand can always go downmarket, but it’s very difficult to go upmarket once the brand is down.”
Calacanis, a friend of Elon Musk, suggested $99 per year. According to the excerpt, he thought the double-digit price would attract more users than if Twitter asked for $100 per year.
Musk also contacted his biographer, Isaacson.
“It should be accessible to everyone,” Isaacson told Musk, according to the excerpt. “You want a really low price point because this is something that everyone is going to sign up for.”
Sacks, Calacanis, Isaacson and a spokesperson for X did not respond to a request for comment.
According to the excerpt, Musk was close to charging users $100 a year until his top aide, Jehn Balajadia, argued that the service should be more affordable.
“There are a lot of people who can’t even buy gasoline right now,” Balajadia said at a meeting, according to two sources who spoke to Times reporters.
“You know, how much do people pay to go to Starbucks? Like $8?” Musk asked, according to the clip.
Musk then pulled out his phone and tweeted on November 1, 2022: “Twitter’s current lord and peasant system for who gets a blue checkmark and who doesn’t is bullshit. Power to the people! Blue for $8/month.”
About a year later, Twitter rebranded as X, and the company had between 950,000 and 1.2 million premium subscribers, or less than 1% of its total user base, Bloomberg reported, citing an analysis by an independent researcher.
