How Much Money Does Telegram Need and What Is It Spent For?

Forbes calculated Telegram's expenses, and revealed what exactly the money is spent on.

Earlier this month, Pavel Durov, the founder of Telegram, said that if 2.5-3% of the more than 700 million active users of the messenger buy subscription, the messenger will cover all its costs. The cost of a paid subscription is $4.99 per month in the US, and 449 rubles in Russia (it can be purchased through a special bot for 299 rubles).

At the same time, if income exceeds costs, the messenger will have some profit and, accordingly, will be able to add new services that are expensive to maintain like Stories, reads the article.

Subscription prices vary by country, averaging around $4, a Telegram source said. If 2.5% of the audience pays for a subscription (that's 17.5 million people), then Telegram will receive about $70 million per month. If VAT is taken into account (the world average is about 20%, the tax is already included in the subscription price in app stores), the company will have $56 million left - or $672 million per year.

Telegram will also need to pay commissions to the App Store, Play Market and other online stores. StockApps estimates that in January 2022, the share of Android smartphone users in the global market reached 69.74%, while the share of Apple users was 25.49%. Thus, according to Forbes, after paying a commission to app stores, Telegram will earn about $45 million per month, or $540 million per year, without taking into exchange rate changes.

At the same time, Telegram previously introduced built-in advertising, which was supposed to cover the costs, but it was probably not enough. This led the messenger also to introducing a paid subscription, Forbes source believes:

As a result, Telegram uses two cash flows at once as financing - advertising and subscription. This means that 3% of the subscription audience does not cover all costs, but only a part, he argues.

Forbes also noted that in 2020, when Telegram had 400 million users and spent $220 million annually, the cost per Telegram user was $0.55 per year. By 2022, the messenger's audience has grown to 700 million, while maintenance costs rose to $540 million, which equals to $0.77 per user. For comparison, as of 2018, the cost per user of the Odnoklassniki and VKontakte social networks was 100.8 rubles ($1.6) and 79.2 rubles ($1.3) per year.

An increase in per-user costs is inevitable due to an increase in activity on average (users began to consume more traffic and disk space) and inflation (for example, an increase in the cost of server equipment), a Telegram source told Forbes.

At the same time 35% of the funds are spent on equipment so that the messenger does not depend on cloud solution providers. 25% of the funds are spent on user verification via SMS, 15% go for salaries and rent and the last 5% account for Internet traffic.