Meta's social media platform Threads, intended to rival Twitter, initially gained attention with impressive user registrations but has since seen a sharp decline in daily engagement, dropping 79% from a peak of 2.3 million users to 576,000.

Companies like Wendy's and Anthropologie have also reduced their activity on Threads. This decline contrasts with its rapid initial growth, which made it one of the fastest-downloaded apps. Threads aimed to take advantage of issues at Twitter under Elon Musk's leadership, such as staff layoffs, policy controversies, and decreased revenue.

Why does it matter?

Threads' decline in engagement and user activity underscores the difficulty of competing in the social media market, especially against established players like Twitter. Attributes such as network effects render the social media sector susceptible to significant obstacles that make it hard for new players to enter.