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Twitter Inc. has done something once thought to be unimaginable. He shut down one of his biggest attractions – Donald Trump’s account – and in doing so also dismissed a sitting US president.
The ban and the public safety logic behind it are part of a crackdown on public digital spaces where the president’s most radicalized supporters congregate, and it comes in response to violence and the blood from last week’s assault on Capitol Hill. Over the weekend, the conservative new social network Speak’s was effectively shut down by the tech giants it relied on to reach its user base – including its removal from Google’s app stores and ‘Apple Inc. and Amazon.com Inc.’s Amazon Web Services decision to stop hosting the Talk service. While the logic behind the actions was legitimate, the latest developments illustrate the power of these companies as custodians of content and information; their willingness to exercise this power opens a new chapter in the history of Big Tech.
Actions were the right thing to do and inevitable at this point, as I argued last week, even though they raise broader questions about tech companies as arbiter of speech and underscore the arbitrary nature of standards. and the rules that govern content around the world. industry. The evidence is indisputable that the angry mob had used Facebook, Twitter and Parler to coordinate their January 6 attack. Twitter said one of the main reasons for his suspension was a proliferation of posts predicting future armed rallies after Trump’s latest tweets. Allowing the same extremists to use public platforms again to incite more violence would be irresponsible given the events of the past week, so it’s good that they were shut down.
As justified as the measures are, Twitter faces concrete business implications. For better or worse, the ban on Trump – whose constant controversial statements and messages have fueled much of the debate and fervent discussion on the platform in recent years – will limit the growth and engagement of users. The numbers speak for themselves: The president’s account had around 90 million subscribers, compared to the 187 million monetizable average daily active users reported by Twitter in its most recent quarter. Many of his supporters are already threatening to quit Twitter in protest. Good riddance? Perhaps. But investors have already become nervous about the risks. The company’s stock price has fallen 4.5% since Wednesday’s riot, then fell a further 3.8% after hours on Friday after Trump’s ban was announced.
Unlike other tech giants who have taken a stand – all of which have strong balance sheets and generally successful businesses – Twitter struggles to address several fundamental issues, from lack of innovation to inferior ad platform technology and security failures. On top of all this, CEO Jack Dorsey has come under fire from activist investor Elliott Management. Despite a recent rebound in its stock price since last summer amid growing optimism for an advertising upturn, Twitter now faces a bumpier future. And while restrictions on competitors like Speak may at the margins prevent some Trump users from leaving, that won’t be enough to overcome Twitter’s challenges.
What should Twitter do? It needs to attract more users with innovative features beyond its core service and find ways to monetize them. He hasn’t done either in the past decade. To be fair, the company has tried in recent months. Last November, Twitter launched Fleets, an unbeatable version of Instagram Stories and Snapchat Stories. So far, however, it doesn’t seem to be taking off. In my experience, a lot of the stories on Fleets are just screenshots of individual tweets, defeating the purpose of the new feature. Twitter is also testing an audio-based chat room product called Spaces, again copying the competition – this time around, the company-backed startup Clubhouse. But the success of these two offers is not guaranteed.
Perhaps most demoralizing for Twitter investors is that the company’s user base is the rapid growth engine behind two of the hottest startups – the aforementioned Clubhouse and the paid newsletter service Substack. For the record, Twitter may already be too far behind the two. Since I linked my Twitter account to Substack and Clubhouse, I have received frequent daily notifications which show an impressive influx of Twitter users that I am following by joining startup platforms. It’s not just word of mouth either: Substack emails and the Clubhouse app offer one-click access to subscribe or follow these new accounts. The reality is that they are using the rails of Twitter for free to expand their memberships. A year from now, Twitter shareholders could again be complaining about how the company missed the next big thing in these two lucrative new areas of growth that Twitter should have dominated.
Ultimately, Twitter should be applauded for putting the public interest on its profits. But its future, already cloudy, is now decidedly more complicated.
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