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Behind the Numbers: an EMARKETER Podcast
The Daily: What The Hell is Bluesky, and How Much of a Threat is it to X and Threads? | Dec 3, 2024
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- [00:02]
Daniel Konstantin Rich
They are also gaining a lot of the kind of power users that are leaving X that once made Twitter such a valuable platform. You know, journalists, news platforms, a lot of them have left Twitter since the election and they're now coming to Blue Sky.
- [00:22]
Marcus
Hey gang, it's Tuesday, December 3rd. Yes, Jeremy, Danny and listeners, welcome to the behind the Numbers Daily and Emarketer podcast made possible by Liveramp. I'm Marcus. Today I'm joined by two gents who I hung out with yesterday, have the pleasure of hanging out with again. Today. We have with us Jeremy Goldman. He is our senior director of all things briefings. He is based in New York City, coming to us from the studio again, welcome back to the show, Jeremy.
- [00:49]
Jeremy Goldman
Happy giving Tuesday.
- [00:51]
Marcus
Hello. We're also joined by our analyst who writes for our marketing and advertising briefing. He is also based in the city and we refer to him of course as Daniel Konstantin Rich. Ok.
- [01:01]
Daniel Konstantin Rich
I wasn't sure if you were going to say something other than my name. We refer to him as, I don't know, office clown.
- [01:06]
Marcus
Not in front of your face, Daniel.
- [01:07]
Daniel Konstantin Rich
Yeah, yeah. Save that for, you know, after the recording.
- [01:11]
Marcus
Wouldn't dream of it. Today's. Why is it called a Michelin star? Even if you know it makes no sense.
- [01:18]
Daniel Konstantin Rich
So you know, the big guy made out of tires.
- [01:22]
Marcus
Unfamiliar.
- [01:23]
Daniel Konstantin Rich
The, the Michelin man, he's a really big fan of the food.
- [01:27]
Marcus
So terrible joke aside is kind of right, because Michelin, the Michelin tire company did come up with it, which is insane. So the founders of the famous Michelin tire company created the Michelin Guide in 1900.
- [01:40]
Daniel Konstantin Rich
Oh, wait, I didn't even know it was the same.
- [01:42]
Marcus
It's the same thing.
- [01:43]
Daniel Konstantin Rich
Making a really bad joke.
- [01:44]
Jeremy Goldman
Oh, no, no, it really is. Yeah, it's the, it's the Safe Huff Marshmallow Man.
- [01:49]
Marcus
Yep. They came up with it as a restaurant rating system, whereas star signifies a high quality dining experience. You get one, two or three. And it was invented to encourage people to travel more by car.
- [02:00]
Daniel Konstantin Rich
Interesting.
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Marcus
And help them find places to eat along the way. Any guesses on which country or city I have both here has the most Michelin stars.
- [02:11]
Daniel Konstantin Rich
Maybe like France.
- [02:12]
Marcus
Bang. Yes. France has the Highest number of three star Michelin restaurants. At least three star won 30 of those, followed by Japan with 20, Spain with 15. Notes Kayla Zhu of Visual Capitalist. But the city with the most Michelin star restaurants, 1, 2 or 3 is Tokyo with nearly 200.
- [02:33]
Daniel Konstantin Rich
Japan was going to be my other guess if I didn't say France.
- [02:36]
Jeremy Goldman
Marcus, I just looked this up by the way the most Michelin stars per capita. You would never guess ever at the Luxembourg.
- [02:43]
Marcus
Oh wow. Yeah, that makes sense.
- [02:45]
Jeremy Goldman
I just fun facted your fun fact. Boom.
- [02:47]
Marcus
You only need like one and it would be very small country. But it feels weird that attire maker came up with the most esteemed and influential racing system in the culinary world.
- [02:58]
Jeremy Goldman
Have the biggest dad joke ever, which is that they were tired of picking the wrong restaurants.
- [03:03]
Marcus
Okay, moving on. Today's real topic that's not going to make the show what the hell is Blue sky and how much of a threat is it to X and Threads? Maybe so bluesky is what we're talking about today. Maybe you use it, but what is it? Bluesky describes itself as social media, as it should be. The X Twitter alternative looks very similar, but one big difference is that BlueSky is decentralized, which means users can do things like customize their handle moderation filters, they can customize the algorithm. There are over 50,000 different BlueSky feeds available. Tom Gherkin of the BBC explains that BlueSky was created by former Twitter founder Jack Dorsey, which began as a project inside Twitter, but became an independent company in 2022 when Mr. Dorsey was still in charge of Twitter. Gail Cooper of CNET notes that the name ties into Twitter's bird mascot, the idea being that the bird could fly even more freely in an open blue sky. Mr. Dorsey stepped down from the board of blue sky in May 2024 and it is now predominantly owned by Chief Executive Jay Graber as a US Public benefit corporation. The social platform has been around since 2019, but it was invitation only until February of this year. Blue sky saw a wave of new users following Mr. Trump's success in the US elections in November, since X's owner, Mr. Musk, was a big backer of Mr. Trump during the campaign. During his campaign, Blue sky had 21 million users as of November 21, after adding a few million following the US election. It was at 9 million in September. Daniel, start with you can Bluesky sustain this user growth momentum? It seems like it's adding, it's quoted as saying about a million per day since the election.
- [04:53]
Daniel Konstantin Rich
Yeah, I think it can sustain it to some degree if it plays its hand. Well. The momentum after the election has lasted for a really long time. For Blue sky, momentum creates its own momentum. You know, more users are coming to this platform, especially who are burned by X, as we talked about yesterday. And with more people coming, you know, more interest is generated around the platform so people could continue to sign up. What levers can Bluesky pull to continue that growth, I think is an interesting question. The platform does not have advertisements right now, which is something that's going for it and may be hesitant to turn on one because it didn't go so well for them at Twitter, you know, always struggled to generate ad revenues and I'm sure Dorsey is mindful of that. They are also gaining a lot of the kind of power users that are leaving X that once made Twitter such a valuable platform. You know, journalists, news platforms, high interest public people. A lot of them have left Twitter since the election and just over the last two years in general. And they're now coming to Blue sky, which could also attract a lot of followers.
- [06:02]
Marcus
One group they don't have yet is the sports people. And that's a big draw for people on X. I was reading about about this. This was a note from Freddie Najer, an associate professor at USC's Annenberg School for Communications and Journalism. He was saying many of the accounts that break sports news, Adam Schefter, Sham, Sorania Woj used to be before he retired vspn, and Ian Rapaport of NFL Network, they're not yet on Blue Sky. So when they shift, that could also, or if they shift, they could be a, a wave.
- [06:34]
Daniel Konstantin Rich
That's, that's an interesting one that I think they're also in some competition with other platforms like Reddit for perhaps, you know, one of the nicer ways to use Twitter was to kind of have it open as a companion during some major event, whether it's, you know, a sports match or the election or the Oscars or something like that. And that service is kind of splintered across a lot of these platforms. Reddit now has these live blogs on sports subreddits that are very popular and get a lot of activity. So there are places for those users to go if not Blue Sky.
- [07:10]
Jeremy Goldman
But, but it is a very interesting point, Danny, I think that you bring up, which is that yes, people will cross post on a number of these platforms, but on the ones where it's very valuable to have people doing things like on a real time basis, if you get somebody like Shams, you know, who moves over to Blue sky and then that's the default place where they're going to break news and maybe they'll engage on X, but like that's not their default place, that can obvious really benefit one platform. But I still kind of fall on the side of realism, which is if you look at a platform, the visits have skyrocketed over 500% in the US and 350% in the UK in the week following the election. And if you look at all of these big numbers and then you couple it with the fact that X, according to some data that I've seen, saw that they had a 27% spike in downloads post election and that's off of a much bigger base than Blueskin sky, right? So the chasm between the platforms doesn't necessarily close all that much. I think that the default for every new social platform that becomes in vogue is for it not to fail or for it not to take over, right? So we shouldn't assume that it's going to happen. But for marketers, it's too important to not be aware of these types of moments. When they do occur, you have to be really on top of it. You can't afford to say I'll just wait to see if it explodes and stays dominant and then I'll get on to it two years from now. Because by that point all of your competitors will understand that platform far better than you do.
- [08:47]
Marcus
I think you're spot on in terms of making sure that you're paying attention to what's new so that if it does take off, you have some kind of a comprehension of how that works and what the best strategy is. Let me throw this at you guys because I'm wondering though if this is the type of user growth that the platform wanted or that marketers advertising if they were to advertise in the future. On Blue sky they said they don't want to do advertising, but maybe they will if they're the type of users the platform wants from an advertiser's perspective because it seems like the political divide is being further enhanced online. A couple of folks mentioning this, Sarah Fisher of Axios writing that left leaning apps, news sites and social networks are experiencing a spike in engagement following President Elect Trump's election win. Further dividing the Internet along political lines. Bruce Crumley of Inc. Was writing that we're seeing the siloing of Americans content choices, especially news. Blue Sky's growth may signal progressive or independent people fleeing the increasingly hard right content of X for lower key, often left leaning posts. In other words, X may be crystallizing as a social media version of Fox News or Newsmax, while BlueSky becomes a user generated content variant of CNN or MSNBC. Whether that's those are fair comps or not, you can potentially see a bifurcation, a splitting of people on the right going this way, people on the left going this way, and maybe advertisers saying, you know, this isn't the kind of cent independent type of platform that I want to advertise on.
- [10:13]
Jeremy Goldman
There's a few things there. One thing is that advertisers want to reach where the people are. So if more people are in a particular place and if bluesky can benefit from advertising, then they would be hard pressed to say no to that forever. There was a time where OpenAI was a not for profit in general. There was also a time where Netflix did not want to have ads until the point that it ran out of subscriber growth without having an ad supported tier. So platform platforms often change their approach. I will say that there's some differences between your media consumption on cable TV versus where you interact from a social standpoint. People will be on multiple platforms, but they tend to over index a lot of their time on one particular platform or two that they make home. There is a finite amount of time spent per day. It's harder and harder to get people to spend more and more time with media. So therefore I would expect that ultimately there are going to be some winners. I don't think that it's going to be split evenly between Blue sky and X and threads. You know, people have to pick a home base.
- [11:24]
Marcus
It is interesting, Danny, there was another take from Kevin Reese of the New York Times saying that text based social media is less dead than we thought and that there's still plenty of demand for this kind of social networking experience. It's interesting that, you know, the pivot was assumed to be that was going to go completely to video and there is more and more video popping up, but there is still, it seems, some demand for text based social media.
- [11:48]
Daniel Konstantin Rich
Yeah, I think the fact that all of these competitors have cropped up and, you know, are gaining significant attention definitely speaks to the fact that users want something akin to the old Twitter experience to go back for a second to talk about user growth. And I guess this also fits in with demand for text based media. There are a couple big things standing in the way of Blue sky becoming this major prominent platform that maybe Twitter once was. I don't know if it has that kind of potential. There was some an interesting report from Pew Research recently that found that 21% of U.S. adults get their news from news influencers or get some amount of news from news influencers. And 85% of those news influencers still have a presence on X. So despite the fact that, you know, these journalists and news outlets are leaving, common sources of news are still on X. And if they don't make the migration over to Blue Sky. You know, I maybe there's less potential there for growth. And then there's also Threads, which is something that I think, you know, we definitely have to mention in a conversation about Blue Sky's potential growth because it's a big question mark. I mean they've managed to attract way, way, way more users than bluesky has by virtue of linking it to Instagram, which is definitely a benefit that Threads had. So, you know, if there was no Instagram and Threads was being spun up on its own, maybe it would have poll similar to Blue Sky. But you know, it doesn't exist in that vacuum. It's part of one of the biggest social media platforms out there. But then a differentiator for Threads is that they really are not prioritizing news content at all. If you want to see news content and political opinions on Threads, you have to opt in. So it doesn't need that same, you know, news driving audience or news driving, you know, group of creators that X or Blue sky may need.
- [13:50]
Jeremy Goldman
Good point.
- [13:51]
Marcus
Yeah, Threads got a huge audience. I mean it could come out out as the advertising winner if any of X is leaning, if it is leaning right and there is some, some research to suggest that civic science saying that Trump voters much more likely to be active on on X. But if you do have folks on X leaning rights and Blue sky, if it does end up doing advertising, potentially ends up leaning left. Threads preparing to debut ads in 2025 might seem like a more attractive, safer option as well as being part of the meta ad buying ecosystem. That's not going to hurt it at all. Jeremy, how much of a threat is bluesky to these other players do you think out of 10?
- [14:29]
Jeremy Goldman
It's a good point. I mean I think that maybe it's a five. I think that, you know, meta has gotten very good over the last few years at looking at any perceived threat and just to be safe, kind of trying to figure out how they can take certain ideas from them. The perfect example of which is these different custom feeds that you can follow on Threads, which is basically a feature of bluesky by the way, it should be noted bluesky largely copies old timey Twitter. So everybody does borrow from everybody else. But if you're big enough so that people can copy your functionality or are concerned enough, then I would say they're on the map. I just think that ultimately it's metas to lose its exes to lose they have to really basically be outperformed, you know, by to an enormous Magnitude from a company that only has about 20 employees. And that's a really tall order.
- [15:28]
Marcus
Danny, out of 10, how much of a threat is Bluesky?
- [15:32]
Daniel Konstantin Rich
I'm going to give it a pretty low rating. I'm going to give it like a three because X, you know, has the users to shed that Blue sky needs in order to grow. So it's, you know, user growth depends on some level on X's decline, which to be fair, we do expect users to decline on X pretty steadily over the next few years. But Instagram and Threads are really insulated from that threat. The rise of Blue sky does not really challenge Threads all that much, even though we have seen them respond to Blue Sky's big post election surge with features like the topic based feeds that Jeremy brought up. But another issue is that, you know, since Blue sky doesn't have advertising right now, and they've said that they don't plan to at the moment though that of course that may change. They're not competing for the same pool of ad dollars that Threads and X are competing for either. So, you know, even if Blue sky attracts several million more users and those users all stay as active on the platform as they are after signing up, it's not like they're shedding a huge amount of revenues to Blue sky because there's no ads there.
- [16:48]
Marcus
Yes, a good point. If we look at Blue sky, they have way less users. As we've mentioned, X has 360 million monthly active users worldwide, according to our forecasts. Meta's X competitor threads that we've been talking about has about 275 million users. That's up from 200 million in August. Blue sky by comparison has 17 1000.
- [17:11]
Daniel Konstantin Rich
I think those numbers are really important to frame this rise of Blue Sky. You know, Blue sky has been around since not that long after Musk first acquired Twitter and it's kind of just now having this big surge that it perhaps wanted earlier on. So yeah, it's far, far behind.
- [17:29]
Marcus
Been in the works for a while, but only open to the public since February of this year. So yes, still very, very, very new. But to your point, ex Twitter users, they are going in the wrong direction and pretty fast. We expect Twitter to lose 10 million users worldwide next year and another 10 million the year after that. They do have them to lose. That number is going down in the US Though, eventually that's going to become an issue. Maybe not quite yet, but that's what we've got time for. For today's episode. Thank you so much to my guests for hanging out with me today and also spend some time with me on yesterday's episode about Twitter, about X. Thank you to Jeremy.
- [18:05]
Jeremy Goldman
Thanks so much for having us, Marcus. This was great.
- [18:08]
Marcus
Yes. Thank you to Danny.
- [18:09]
Daniel Konstantin Rich
Thank you.
- [18:09]
Jeremy Goldman
Yeah.
- [18:10]
Daniel Konstantin Rich
I'll see you on Blue sky or Threads or X or all of the above.
- [18:16]
Marcus
We'll see. Thank you to Victoria, who edits the show. Stuart runs the team. Sophie does our social media. Thanks to everyone for listening in to the behind the Numbers Daily the Market podcast made possible by Live Ramp. Tomorrow, you can hang out with Sarah Lebo on the Reimagining retail show where she'll be speaking with Sky Canavas and Jeremy Goldman, who is hanging out with us today, all about how retailers can capitalize on New Year's resolutions.
- [18:42]
Jeremy Goldman
Okay, a lot of money. Boom. I'm gonna buy a flight with blue origin and then just, like, orbit the world and the snail can't get me.
- [18:50]
Marcus
Gonna live in orbit all the time.
- [18:52]
Daniel Konstantin Rich
Sounds like the snail won.
- [18:53]
Marcus
Snails are honest. It's violent. But they're not corrupt.
- [18:56]
Daniel Konstantin Rich
Exactly.
- [18:57]
Marcus
There's no way they'd take in that money. Apparently, it will kill you. But I think they're.