Digital Platform Policy Highlights - Digest 19
Q3 2023: This post outlines how certain platform policy changes benefit/hurt subgroups of users who derive high utility from certain premium features.
TL;DR →Policy changes to extract surplus from a subgroup of users who value some specific features
X extends tweet editing window
X, formerly known as Twitter, is extending the window for editing tweets to 1 hour, but only for the paid (Basic, Premium and Premium +) subscribers. In contrast, free users aren’t able to edit tweets at all. This change joins a string of changes that X has implemented to lure more users to its Premium services as advertising revenue has continued to plummet. However, this policy change, like many other policies, has a potential to generate a backlash. One may argue that an ability to edit their own tweets should either be available to everyone (as in WhatsApp/iMessage) or no one. (link)
Twitter Locks TweetDeck (X Pro) Behind Paywall
X joins many digital platforms which have discontinued “free lunches” in 2023. For heavy-duty Twitter users, TweetDeck (now called X Pro) has been the application of choice, as it offered much more powerful features over the regular Twitter website. Now, TweetDeck will be exclusive to X Premium and Premium+ subscribers, a move that makes sense given users closely tied to Twitter would be more willing to pay up for advanced features. Regardless, it would sting to see a power product that was once free now cost a monthly subscription to use.(link)
Discord will allow content creators to sell downloadable content
Discord, a communication platform for communities, plans to let creators sell digital products such as ebooks, guides, or wallpapers to their audiences via one-time purchases. These products will be available in a Server Shop, which is in testing. Discord changed this policy along with the release of Media Channels, a new type of channel for sharing videos, photos, and files. The new monetization features could further entice content creators to use Discord to interact with (and monetize) their fanbase, broadening Discord's customer targeting. (link)
TikTok launches its own online store
Social media platforms realize that influencers wield substantial influence in product/service promotional efforts, resulting in a growing convergence of social and e-commerce. TikTok will allow sellers/influencers to sell their own merchandise and products from other brands. Given that many creators already use TikTok to promote products, an online store would seem like a good way to expand its business. Nevertheless, its US prospects are daunting: Instagram got rid of its own shopping tab earlier this year, as live-streaming platforms have struggled to get users to try live shopping during live streams.(link)
Meta to charge cloud giants for reselling its AI tech
Meta Platforms Inc. announced that it will require a revenue share from cloud providers like Microsoft, Amazon, and Google, who resell its artificial intelligence large language model, Llama 2. This is a change from its previous statement that it would offer the technology for free and open-source. Meta evidently does not want these large cloud companies, which are developing competing LLMs of their own, to have a free ride through Llama 2. From the firm perspective, the policy changes could be viewed as a justified response to maintain its competitive advantage.(link)
This is the seventh part of a multi-part post. You can find part one, part two, part three, part four, part five and part six here. If you know someone who enjoys these kinds of posts, please share it with them :)
Research help from Anantesh Mohapatra and John Mai (Thanks a ton, folks!)