Do we really need the complication of premium subscriptions in messaging apps?
Messaging app Telegram has confirmed that premium subscriptions are on the agenda, though it will be optional as all existing functionalities will continue to remain free for all existing and new users
Should our messaging apps be complicated by the clutter of premium features, subscriptions, and some functionality behind a paywall? We may be walking down that path sooner than expected as the sixth most popular instant messaging app in the world (550 million and counting) according to the latest numbers by research firm Statista –Telegram – has confirmed that premium subscriptions are on the agenda for later this month.
The company will in all likelihood add a Telegram Premium layer to its app. It’ll be optional (the subscription tiers aren’t available yet, however). Pavel Durov, founder and CEO, insists that all existing functionalities will continue to remain free for all existing and new users. However, within the ambit of subscriptions will be the new features.
“All existing features remain free, and there are plenty of new free features coming,” Durov said in a statement, adding, “Moreover, even users who don’t subscribe to Telegram Premium will be able to enjoy some of its benefits: for example, they will be able to view extra-large documents, media and stickers sent by Premium users, or tap to add Premium reactions already pinned to a message to react in the same way.”
More tools to customise your chats, faster downloads and voice to text messages are some new features that have been seen in the latest Telegram beta app. This could be indicative of features that may arrive within the Premium ambit, though there is never any guarantee that all features in beta tests will make it to the final app versions.
The monetisation goal was initially targeted for 2021. Telegram doesn’t have deep pockets, unlike its closest rivals Facebook, Google and Chinese apps, including WeChat. This is something the company has alluded to over the years, including in December 2020, while outrightly dismissing the idea of in-chat advertising. “We think that displaying ads in private one-on-one chats or group chats is a bad idea. Communication between people should be free of advertising of any sort,” the company had said.
“A project of our size needs at least a few hundred million dollars per year to keep going,” Durov had pointed out. There is the cost of servers and employee salaries. These costs increase every year, also because of the widening subscriber base. It was 550 million as of January this year and counting.
Telegram’s privacy pitch worked over the last couple of years as the pandemic turned focus to communication apps, and WhatsApp’s privacy debacle making users look elsewhere (even if it was for a solid second messaging app for certain chats).
If this becomes a trend, it may very well throw a lifeline to Meta (the parent company of Facebook), which has not had a good time of it of late. Meta estimates that they are looking at as much as a $10 billion hit in advertising revenue in 2022, mostly because of Apple’s strict implementation of privacy features that prevent apps from tracking users across the web and other apps without their explicit permission.
Turns out that users, when given this choice, are definitively opting out of being tracked for targeted adverts by platforms such as Meta (which also owns WhatsApp and Instagram). Facebook, for the first time in its 18-year history, also saw daily active users decline in the last quarter. The company seeks a new revenue stream.
This could lead us to WhatsApp and Messenger, two of the most popular instant messaging apps globally – an active user base of 2 million and 1.2 billion, respectively. A premium feature set, behind a subscription wall, could rake in money for these two apps. The advantage is in the numbers; for such a large user base, even a fraction of users signing up will be a fairly substantial demographic.
Twitter had already embarked on the Twitter Blue journey a while ago with the $2.99 month subscription. Elon Musk, if the acquisition does go through, has already made clear he expects more. He expects Twitter to earn as much as $10 billion in revenue by 2028 from subscriptions. As of now, the product on which the spotlight shines is Twitter Blue, currently available in some countries including the United States, Canada, Australia and New Zealand.
What’s included in Twitter Blue? Subscribers ($2.99 per month) get access to an “undo tweet” option, ad-free articles, and some other exclusive features within the app, including Bookmark Folders.
Which messaging apps have monetised well? According to data by Statista, Line messenger earns the most revenue from in-app monetisation ($28.4 million per year). QQ messenger ($11.30 million) and WeChat ($5.1 million) follow. Taking forward the example of Line’s in-app functionality, it is bordering on what we may classify as a super app. Depending on where you’re using it, functionality includes news curation, connecting with a doctor for consultation, digital payments, and music streaming, etc.
It may be too soon for Telegram to think on this scale (if at all), but messaging app monetisation has worked elsewhere. And for all that it is worth, this may trigger a set of events which we may or may not really like.