Last month Elon Musk announced that he is mulling charging all new users on X a “small fee” as a measure to save the platform from the scourge of AI-powered spam bots. The tweet appears to be the expansion of the October 2023 decision by X to charge $1 to users in selected markets to verify they are not bots.
Unfortunately, a small fee for new user write access is the only way to curb the relentless onslaught of bots.
Current AI (and troll farms) can pass “are you a bot” with ease.
— Elon Musk (@elonmusk) April 15, 2024
While neither Musk nor X has gone into details of how a more universal charging plan would work, the decision could have particular repercussions in Japan. Japan is by far the major market with the most widespread adoption of X, with 73.4 million accounts in 2024, representing a nearly 59% penetration rate.
In comparison, in its home market of the US, X only manages 105.4 million accounts, or a little more than one account for every 10 people. The high penetration ensures that X has three times the footprint of countries with larger populations, including India, Indonesia, Brazil, and Mexico.
X’s dominance in Japan
Many studies and articles have been written on the rationale behind X’s dominance in the Japanese market, against globally popular alternatives such as LinkedIn and Facebook. The Japanese preference for anonymity, the ability of the Japanese language to cram more information into X’s character limits, and the platform’s ability to source real-time updates on major events are all cited as explanations for X’s outsized success.
“These firms can tweet out to millions of target consumers without a single cent of advertising spend. In particular, with more than 78% of Japanese in their 20s on X, the ability to approach younger consumers through X remains immense.”
Whatever the reasons driving the success, X’s critical mass of frequent use among the general public means that it has become a go-to platform for Japanese businesses and marketers to raise awareness of their latest product and service offerings.
Among the ten most followed X accounts in Japan, most are major businesses like the convenience store Lawson, gaming device maker Nintendo, and coffee chain Starbucks Japan.
These firms can tweet out to millions of target consumers without a single cent of advertising spend. In particular, with more than 78% of Japanese in their 20s on X, the ability to approach younger consumers through X remains immense.
More interestingly, X’s Japanese user base has not reacted as negatively as America’s after Musk took over the platform and proceeded with his reforms and rebranding.
Whereas X’s number of active users and advertising revenue in the US respectively declined by 23% and 50% since Musk’s November 2022 takeover, active usage in Japan increased, according to a July 2023 survey of X users. The latest round of the same survey, conducted in March 2024, shows that 75% of X account holders in Japan access the site at least once a day while only 15% of the user base reduced overall usage.
The same survey shows that more than half of Japanese X users continue to follow official business accounts, with 60% purchasing products and services because of what they saw through those accounts. This dichotomy, in an extreme scenario, may lead to an end-game a la Yahoo, with the Japan version remaining popular while the US version is but a shadow of its former self.
Will money incentivize a shift away from X?
However, it is not yet a foregone conclusion that X will remain a dominant presence among Japanese social media users for years to come. Should the company move forward more aggressively to monetize X’s user base, it is conceivable that its Japanese users would find alternative platforms that provide similar functionalities for free or at a much lower price point.
“Should the company move forward more aggressively to monetize X’s user base, it is conceivable that its Japanese users would find alternative platforms that provide similar functionalities for free or at a much lower price point.”
On one hand, existing platforms may start to eat X’s lunch in Japan. With LINE increasingly pushing companies to set up official marketing accounts at no initial cost, its 96 million users in Japan are also shifting away from merely using the platform for private conversations with friends to more open relationships with businesses.
Tiktok’s 66.4% usage rate among Japanese teens, compared to the 54.3% equivalent for X, means that as these teenagers grow up, Tiktok has the potential to replace X as the dominant SNS among younger consumers.
On the other hand, there could be greater fragmentation of the Japanese SNS scene, as various startups launch new services to fill niches underserved by the generalist platform that is X.
Japan-based new services include those that specifically link individuals with business needs, those that cater to the higher security and private concerns among parents of children under the age of 12, and even those that seek to address the increasing issue of fake news through tighter verification of user origins.
Rather than one platform replacing X as Japan’s dominant, X users may increasingly spread out to multiple platforms based on differing interests.
Given X’s status as an important aspect of Japan’s digital social infrastructure, the shift from X to elsewhere will certainly not happen overnight.
But if the company evolves in a way that does not take into account the fact that the platform, in its current form, remains highly popular in Japan, it could risk users departing for platforms that can fulfill what made X so loved. Charging users a fee, however nominal, may initiate that migration.
Image by Jezael Melgoza.
