User growth stalls at Elon’s X Amidst New Competition from Meta’s Threads

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X has been grappling with stagnating user growth, as its owner Elon Musk’s polarizing presence and emerging competition from Meta’s rival platform Threads present new challenges.

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Recently released figures reveal that X’s global daily active users in the second quarter of this year reached 251 million, marking a modest 1.6 percent increase from the same period last year. This is a stark contrast to the robust double-digit growth seen in the years prior to Musk’s $44 billion acquisition of the company in October 2022. Musk rebranded the platform shortly after taking it private, and his leadership has sparked division.

Since Musk’s takeover, the group has lost advertisers, partly due to his commitment to “free speech absolutism” and the significant reduction of content moderators on the platform. Critics argue that this has led to a more toxic environment, while Musk defends the measures as necessary to curb financial losses.

The competitive landscape has intensified with Meta’s launch of Threads, which now boasts 175 million monthly active users according to CEO Mark Zuckerberg. This is in contrast to X’s claim of 600 million monthly users. However, Sensor Tower estimates Threads has only 38 million daily active users, indicating lower engagement compared to other social media platforms.

Threads experienced an initial boom upon its debut last July, achieving 100 million sign-ups in its first week and becoming the fastest-growing app ever. Despite a sharp decline in usage soon after, the platform has gradually regained traction, especially after expanding into the EU and high-profile endorsements from celebrities like Taylor Swift. It also benefits from integration with Instagram, driving significant web traffic.

Meta has leveraged its existing moderation teams for Threads and has committed to minimizing news and political content on the platform to avoid negative scrutiny. According to Adam Mosseri, head of Instagram and Threads, this approach aims to steer clear of integrity risks.

While 17 percent of UK adults use X for news, engagement on the platform has decreased during recent national election campaigns in the US, UK, and France, according to Similarweb. X disputes Similarweb’s data, asserting that its monthly users in the US and UK increased significantly between August last year and June this year, though it did not provide specific figures

Copyright The Financial Times Limited 2024

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