Is the Rise of Conservative Social Media a Risk for Big Tech?
There has been a rise in conservative social media networks. Most of the networks have pitched themselves as flagbearers of free speech. Why are conservative social media channels becoming more popular? What does it mean for Big Tech and social media companies like Facebook owner Meta Platforms and Twitter?
Two of the conservative social media companies, former President Donald Trump’s TMTG (Trump Media & Technology Group) and Rumble, are going public through a SPAC reverse merger.
Publicly traded conservative social media companies keep popping up.
Trump’s TMTG is going public through a reverse merger with Digital World Acquisition (DWAC). The stock went as high as $175 but currently trades around $50. It's still a remarkable feat considering the fact that many SPACs that have announced mergers trade well below the SPAC IPO price of $10.
Rumble is going public through a merger with CF Acquisition Corp. VI (CFVI). The stock hit a high of $15.48 but currently trades around $12. Both of these SPAC mergers still need to be approved by stockholders for TMTG and Rumble to list.
Apart from these two companies, all of the other conservative social media companies are privately held. Sooner than later, these companies might also consider a listing.
Some privately held conservative social media companies take on bigger companies.
Parler and Gab are two of the other conservative social media companies. However, both of these companies are privately held. MeWe is a social media company that's seen as a good alternative to Facebook. MeWe isn't exactly a conservative social media company and has positioned itself as an alternative to Facebook.
Why are conservative social media networks getting popular?
Conservative social media networks are getting popular amid the alleged tyranny of big social media companies, which are seen as biased towards liberals while suppressing conservative voices. Many conservatives, including Trump, have got booted off of social media.
While Twitter had its own reasons for removing Trump, conservatives point out that the platform gives a voice to the Taliban and many other dictators globally. There certainly is merit in conservative anger against the big social media companies.
The rise of conservative social media is threat for Big Tech.
Big social media companies like Facebook, Twitter, and YouTube have a massive user base. In the social media industry, the network effect works like wonders. Let’s put it this way, there's little merit in joining a social media network where you don’t find the majority of your friends. The same holds for streaming platforms where new entrants need to compete with the massive content on YouTube.
It isn't easy to say that conservative social media channels don’t stand a chance in a world dominated by big social media companies. These companies have been reporting a massive rise in their user base. However, they haven't hit a tipping point yet where the network effect comes into play.
Conservative social media stocks are popular among investors.
Eventually, social media is a reflection of our society. As society and politics become more polarized, the rise of conservative social media looks inevitable. To borrow a phrase from French poet Victor Hugo, conservative social media is an idea whose time has come.
Stock markets have embraced conservative social media companies, which is reflected in the stock prices of CFVI and DWAC. Conservative social media companies can’t just thrive by capitalizing on the anger. They will need a solid platform to keep users engaged.