It’s been almost seven months since Elon Musk acquired Twitter for $44 billion but the tech entrepreneur has failed to invigorate the company’s fortunes. Financial services corporation Fidelity now estimate the value of the app to stand at just 33% of Musk’s purchase price.

Musk completed his famous takeover of the microblogging site in October, fulfilling his long-term desire to be the boss of Twitter.

The tech billionaire was criticized for overspending on Twitter during the acquisition. Musk paid $44 billion for Twitter, with $33.5 billion in equity. However, Musk has also acknowledged he overpaid and said it was only worth half of what he paid.

“Myself and the other investors are obviously overpaying for Twitter right now. The long term potential for Twitter in my view is an order of magnitude greater than its current value,” said Musk.

Twitter was valued at $20 billion in March by Musk himself in an email that was sent to the company’s employees.

Reminder: Elon Musk massively overspent on his Twitter purchase out of ego and now wants you to pay for it through a subscription plan 😂

— tridder.pugs (@tridder46290) November 3, 2022

Twitter struggles under Musk

Following Musk’s takeover, many corporations and companies cut ties with the platform. Musk’s erratic decision-making and management style is blamed on driving a host of advertisers away.

Ford, General Motors, Volkswagen, General Mills, Mondelez, Pfizer, and United Airlines are among the major corporations that paused or pulled their advertisements from Twitter due to concerns regarding hate speech and conspiracy theories.

International ad and consulting firm Interpublic, which represents American Express, Coca-Cola, Fitbit, Spotify, and dozens of other major corporations, has also stopped advertising on the platform. That cut caused Twitter to lose $24 billion. Given the recent advertiser exodus it is unsurprising that Fidelity downgraded Twitter’s value – but it remains unclear exactly how they arrived at a final valuation.

In November, Fidelity initially decreased the value of its Twitter stake to 44% of the purchase price. This was followed by subsequent markdowns in December and February.

“In 2021, Twitter generated more than 4.5 billion U.S. dollars in advertising service revenues, up from 3.2 billion U.S. dollars in the previous year,” according to Statista.

Also Read: Six Months of Twitter Under the Rule of Elon Musk

Additionally, the micro-blogging platform produced around $571 million in data licensing revenue, up from $508 million 2020.

Insider Intelligence projected “that Twitter’s 2023 ad revenues would reach $4.74 billion worldwide.” However, since Musk took charge, the market research company has cut its projection by “nearly $2 billion, to just $2.98 billion, as the app grapples with brand safety issues, confusing policies, and broken technology.”

Twitter Blue: a flop card

Twitter Blue, a subscription-based verification checkmark with various features, remains one of the most popular changes in Musk’s brief tenure.

In November, the Tesla chief introduced a feature called “Blue for $8/month,” which brought a drastic change to Twitter’s policy by providing a verification checkmark known as a Blue tick.

This feature also offers additional benefits such as the ability to edit tweets, half-ads, longer tweets, text formatting, bookmark folders, NFT profile pictures, etc.

Interestingly, though, the change has been copied by Facebook and Instagram owner Meta, whose subscription service Meta Verified lets users add a blue checkmark to their accounts.

You will also get:
– Priority in replies, mentions & search, which is essential to defeat spam/scam
– Ability to post long video & audio
– Half as many ads

— Elon Musk (@elonmusk) November 1, 2022

Musk faced accusations of charging its users to cover his $44 billion, which he invested to become the boss. Despite the criticism for removing legacy checkmarks from popular accounts, Twitter Blue generated $11 million on mobile in its first three months as a new product.

The amount it has generated is slightly lower than expected, as Twitter has 368 million monthly active users worldwide.

However, Twitter is adding more features to the paid verification badge as Musk tries to develop it as a flagship product under the Twitter umbrella.

The success of the metaverse depends on the ability of developers to build quality experiences that “millions or billions” want to have. To do that the sector must attract, find, and financially incentivize the very top talent from related industries. 

This is the verdict of Neal Stephenson, the man credited with coining the word metaverse in his 1992 novel Snow Crash.

Source the best developers

Famed author and futurist Neal Stephenson says the metaverse must find and attract the most talented people to make the sector a success. Stephenson’s comments came during an appearance at AWE USA 2023 convention on Wednesday. 

“If we’re going to have a metaverse that’s being used all the time by millions or billions of people, then there have to be experiences in the metaverse that are worth having,” Stephenson said.

“That seems like an obvious statement but for me, there’s a glaring and frustrating lack of support for the kinds of people who make those experiences,” added the author. “Right now the skill set that is needed to create the metaverse is basically what you see in the game industry. People who know how to use game engines and how to create the assets that feed into those game engines. Those people by and large have jobs and other things they could be doing. 

“We need to create the economic basis for [developers] to get rewarded if they succeed in creating metaverse experiences that a lot of people enjoy.”

Stephenson cited a number of ways that developers may be rewarded, but his personal vision is for a tokenized metaverse owned and controlled by its citizens.

In June last year, Stephenson announced Lamina1, a layer 1 blockchain infrastructure and open metaverse company. Stephenson co-founded the “batteries-included blockchain” with Peter Vessenes, reflecting their vision for an incentivized metaverse that, according to its website, could “empower a new generation of interconnected, immersive experiences across gaming, entertainment, fashion, music, and beyond.”

Seeing double: Ori Inbar and Ori Inbar introduce Neal Stephenson

A tale of two metaverses

Ori Inbar, the CEO of AWE, hosted the conversation with Stephenson on what marked the opening of the 14th annual AWE convention. The latest event is running from May 31 to June 2 in Santa Clara, California. Those who can’t attend in person are invited to participate online.

In an entertaining introduction, a virtual facsimile of Inbar initially addressed conference attendees, only for the real Inbar to interrupt and reveal the entire monologue was written by ChatGPT. 

Inbar then asserted that AI makes “original voices… even more valuable than before.”

Once Inbar sat down with Stephenson the pair discussed just how far technology is developing across multiple fields. Inbar asked Stephenson where he believed the metaverse was headed; to something dystopian or something utopian.

“I think it would be very early and premature to make announcements today about whether it is going in one particular direction,” said Stephenson.

To Stephenson, both the positives and the negatives of the metaverse can co-exist within just one reality – something he explored in his 1992 novel.

“Our initial exposure to the metaverse is a kind of very vast market, a lowest common denominator to include … the worst of television,” said Stephenson said as he described the surface level of the metaverse. “But later on, as we get farther into the book, we see that people have used it to make beautiful works of art. There are some people … who lavished a lot of time and attention on making homes in the metaverse that are exquisite works of art, both visually and in this sonic environment.”

That ambition of a deeper metaverse is worth striving for, especially as a driver of its long-term success.

Sandbox founder Sebastian Borget has described the metaverse race as a ‘marathon of many sprints,’ as the industry moves beyond the hype cycle to build real value.

Borget remains bullish on the sector and sees opportunities for AI to play its role in building the metaverse stronger, better, and faster.

Raising funds

In November 2021, during the height of metaverse mania, Sandbox raised $93 million at an undisclosed valuation. Today Borget and the company he leads must contend with more challenging macroeconomic conditions, as well as the new technology hype trend – AI.

But Borget remains bullish despite tech’s shifting focus. The co-founder and COO is confident that the company can raise more capital if required, though it may take a little longer given current market conditions.

“Running the Sandbox is like a long marathon of many sprints,” an unfazed Borget told Forbes last week.

Borget firmly believes that the metaverse is poised to become a multi-billion dollar sector. Multiple industries are now finding real value in the metaverse and metaverse-related products, extracting profits from their forays into the virtual plane. As Borget sees it, this augurs well for Sandbox.

“We’ve been very attached to showing concretely what is possible in the metaverse as early as possible. We’ve showcased that it’s not just about gaming, but a new format of entertainment that lies between social interaction and gamification,” said Borget.

“And we’re going to showcase that the Sandbox is resilient and not depending on tech or crypto market crash,” he added.

🔷 @BBC is joining The Sandbox! 🔷

In partnership with @RealityPlusWeb3, favorite brands like @BBC_TopGear and @DoctorWho_BBCA will be bringing immersive new experiences to our community playing around the world! 🌐https://t.co/mpAPLj3ru5

— The Sandbox (@TheSandboxGame) May 25, 2023

That resilience will come down to Sandbox’s popularity and whether it can build critical partnerships and establish a thriving community of users. Since its launch in 2018, the virtual world has enticed 23,500 users to buy virtual land plots. The corporation has further signed 400 brand partnerships.

While these figures paint an optimistic picture of the future for Sandbox, there are still some challenges that lay ahead.

More to do

Sandbox has more to do if it is to be a long-term success story with usage of the platform in decline from last year. Sandbox had 100,000 players in the first quarter of 2023, representing a 72% drop from a comparable 10-week period that ended in November of 2022.

Active wallet addresses are also down 90% from their peak a year ago, according to data from CoinGecko and DappRadar.

Borget remains philosophical about the figures, pointing to the fact that users can visit the platform without making transactions. As for the transactions that were made, these amount to sales of $1 million.

“We have more creators than ever, more users than ever and more brands than ever,” said Borget. “It’s because there’s real utility behind virtual lands and avatars. People see that they can play, engage, and monetize their lands and creations.”

The co-founder is now predicting double-digit growth throughout the rest of the year. The next sprint cycle should see Sandbox fully open to the public as it moves beyond the beta phase. 

Beyond that, the company plans to launch the metaverse project on smartphones next year. That would see Sandbox tap into the mobile gaming market, accounting for half of the gaming industry’s $183 billion revenue last year.