Elon Musk’s X tries to prove that pivoting to video is a smart strategy rather than a punchline

If in doubt, pivot to video.

Over the years, many struggling media companies have bet their futures on online video as a sort of Hail Mary after everything else has failed to turn their businesses around. The strategy, at one point, was so common and, invariably, such a failure, that it became a running joke among Silicon Valley insiders.

That brings us to yesterday, when Elon Musk’s X, the longtime home to brief text-based musings, and more recently, a cratering ad business thanks to its owner’s many missteps, declared that it had become a "video-first platform." What the service, formerly known as Twitter, means by that statement wasn’t explained. But it suggests that X considers video to be a top priority, if not the top priority, and that many users are already visiting specifically for it. As proof, the company asserted that eight out of 10 user sessions on the service involve people watching videos.

It’s easy to guess why Musk, who paid $44 billion for X last year, only to destroy 71.5% of its value, by one measure, would want X to be “video-first.” It’s the same reason why countless media companies—Yahoo and a number of news outlets circa 2015, for example—bet their futures on video. Video ads command much higher prices than the mere pennies, or fraction of pennies, that individual text ad impressions generate.

But if video was a salvation, it probably would have saved the many media companies of yesteryear that piled on. Instead, it turned out to be yet another misguided strategy after the expected riches failed to pan out—and now the source of a tech industry punchline.

The wishful thinking for X continues when you consider the problem of YouTube, TikTok, and Instagram, which already dominate free online video. They’re each helped by armies of creators who churn out clips watched by billions of users combined. X, meanwhile, is a relative newcomer to this space and is so far behind that it’s practically invisible (ironically, the pre-Elon Twitter once owned Vine, a short video app considered a progenitor to TikTok, but the company shut it down in 2017). Yes, X can fork over bucketloads of money to video creators in hopes of eventually catching up, but such a strategy has limited financial upside given that many big-time advertisers want nothing to do with the company and its owner.

Nevertheless, Musk is charging ahead with even more video-related ambitions. Last week, he shared his vision for creating a livestreaming service for video game play, much like Amazon’s Twitch. But again, he would be making a late entry into the free streaming niche, whose underlying value proposition—free—doesn’t exactly scream financial bonanza. In fact, in a sign of its business shortcomings, Twitch said today that it would cut 500 jobs, or 35% of its staff, after two rounds of layoffs last year.

This doesn't mean X should abandon video. It could very well be a decent business, just probably not a big enough one to justify the company crowing that it's now a "video-first platform."

And in general, when you hear about a company pivoting to video, be sure to pivot to being skeptical.

Verne Kopytoff

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This story was originally featured on Fortune.com