Published on the 18/07/2023 | Written by Heather Wright

After the peak comes the trough, while Twitter advertising revenue halves…

After a meteoric start, Meta Twitter rival Threads appears to be coming back down to earth, with usage on the platform dropping back after the initial launch frenzy.

Data from SimilarWeb shows daily active users dropped to 23.6 million – about 22 percent of Twitter’s audience – on July 14, down from 49 million a week earlier. The SimilarWeb figures are largely based on Android usage, with iOS data harder to track, though it is expected to become available in the coming weeks.

“Despite attracting far broader attention than Twitter alternatives like the open source Mastodon or the still beat Bluesky, the Threads spin-off from Meta’s Instagram business unit does not yet have customers coming back regularly,” the website analytics company says.

“We’ve run this playbook many times and I’m confident Threads is on a good path too.”

Data from other market intelligence firms back those findings up, with Sensor Tower reporting declines in both the number of daily active users and the time users were spending on the platform.

Earlier data for the platform, which had 100 million signups in its first five days beating ChatGPT’s earlier record, suggested Threads could prove more useful for businesses than Twitter, with that very early data showing users were more engaged.

A Website Planet survey, which analysed the engagement levels for 30 brands with accounts on both platforms making the same, or similar posts, found 87 percent generated more likes on the Threads post than on Twitter.

Among those posting identical posts on both platforms, Threads showed a higher average engagement rate than Twitter at 0.45 percent versus 0.02 percent, Website Planet says.

The new, declining, figures, while hardly unexpected given the meteoric early numbers, highlight the battle Threads faces to win over social media users.

Its July 5 debut in 100 countries (but not EU countries) prompted mass signups to the app, which is tied to Instagram.

That’s a drop in the ocean, however, on Instagram’s user base of more than a billion. Threads requires users to be an Instagram user in order to join, and has capitalised on that linkage, making it a one tap signup, and enabling follows to be ported to Threads.

That’s a critical point, Lisa Given, Professor of Information Sciences and director of RMIT’s Social Change Enabling Impact Platform says.

“People are not just looking for something that offers similar functionality to Twitter. They want a platform where they can quickly find people they’re already engaging with so they can maintain social connections and not have to ‘start over’ to build their community when they transition to a new platform,” Given says.

“If Meta’s Threads can keep the features people love, not charge fees, offer easy access to existing followers and provide a mechanism to verify accounts – especially to manage misinformation – it may well become a viable replacement for Twitter and increase the mass exodus that has already begun from Twitter’s core user base,” she says.

But the new platform still faces challenges.

It’s not available in EU countries yet due to strict data privacy laws and privacy concerns around the app.

Globally, cautions have been noted over the inability to delete Threads without also deleting your Instagram account (though you can deactivate Threads, while retaining Instagram), and concerns about the volumes of data Threads is gathering on users.

The App Privacy section of Threads app store page details an extensive list of ways the app is collecting and using data – from purchases, financial and health info to user content, usage and search and browsing history.

Carissa Veliz, associate professor at the University of Oxford’s Institute for Ethics in AI, says Meta refuses to rethink its business model and continues firmly on the same surveillance track, despite warnings, fines and scandals.

She questions whether they’re trying to collect so much text now to further train their generative AI.

The app has also now been included in the Biden administration’s ongoing investigation into tech platforms, with the company reportedly asked to hand over documents on content moderation.

Threads is also missing some basic features – something some have suggested is a deliberate move to (unsuccessfully) stave off accusations it’s a near mirror image of Twitter.

Among the missing features is a ‘following’ feed, or timeline showing posts from people you follow. Instead, in the first week at least, Thread users (or is that Threaders?) were forced to wade through feeds which appeared to heavily favour influencers, brands and celebrities.

The ability to search posts, use hashtags, and do direct messaging are also missing, though Meta is promising some ‘obvious’ missing features, like the following feed, edit button and post search are being prioritised.

Twitter’s Elon Musk has threatened to sue Meta over ‘trade secrets’.

Any declines in Threads numbers are unlikely to allay concerns about Twitter which has seen a string of highly publicised changes to drive revenue, along with plenty of issues including several outages since Musk took ownership.

On Saturday, Musk said platform usage was up 3.5 percent week over week.

But he also tweeted that the platform has lost nearly half of its advertising revenue – though he didn’t specify over what time frame – with a ‘heavy debt load’.

Musk, who bought the platform in October for US$44 billion, had predicted earlier this year that the platform could be cash flow positive by the second quarter.

Since the acquisition, Musk has undertaken severe cost cutting, including mass layoffs, but his actions have also alienated advertisers, with big names including Coca-Cola and Unilever pausing their Twitter spend.

Back in February, CNN reported that 625 of Twitter’s top 1,000 advertisers in September were not spending with Twitter in the first weeks of January, though Musk says ‘almost all’ of them have since returned.

SimilarWeb says Twitter saw a five percent drop in web traffic for the first two days after Threads became generally available. While that has now bounced back, traffic is still down 11 percent year on year, highlighting the exodus Twitter has seen.

That’s something Threads will be keen to capitalise on. It’s launch came just days after Musk announced Twitter was introducing read limits because of ‘extreme’ levels of data scraping and system manipulation. That move prompted a backlash from disgruntled users. Ironically, Threads has today announced it will follow suit with limits ‘to combat bots’ as spam attacks increase.

Earlier today, Meta CEO Mark Zuckerberg said tens of millions of people are coming back daily to the platform.

“That’s way ahead of what we expected,” he posted on Threads.

He says the focus for the rest of the year is improving the basics and retention.

“It’ll take time to stabilise, but one we nail that then we’ll focus on growing the community. We’ve run this playbook many times (Facebook, Instagram, Stories, Reels, etc) and I’m confident Threads is on a good path too.”

Instagram head Adam Mosseri also noted growth, retention and engagement ‘are all way ahead of where I expected’.

“Our focus right now is not engagement, which has been amazing, but getting past the initial peak and trough we see with every new product, and building new features, dialling in performance and improving ranking,” Mosseri says.