Why Twitter Won’t Be Around in 5 Years
Social media is changing. Will Twitter survive?
PHOTO CREDIT: Getty Images
The favorite social network of our 45th President might not even live to see the end of his first term.
While Facebook has been on a rocketship of fiscal growth, the userbase of Twitter has remained largely stagnant over the past couple of years. Many experts (and shareholders) feel that Twitter isn't long for this world -- and I agree.
Twitter has failed to prove its utility to the novice user -- the kind of clientele Facebook has in droves. Most importantly, it has also failed to prove its worth to advertisers, who are flocking to newer and sexier channels such as Snapchat.
These are trying times for Twitter, and it could signal that the end is in sight. Here are a few more reasons why I feel Twitter won't be around in 5 years:
Twitter has a problem at the very top. After Dick Costolo stepped aside as CEO in 2015, co-founder Jack Dorsey stepped up to lead the company again.
The problem? Dorsey, who is a talented executive, is also the CEO of Square. Twitter badly needs someone who can devote themselves fully to the company's growth. While Dorsey has said repeatedly that there are no issues running two major companies, you have to imagine that a unified front featuring a laser-focused CEO could only help Twitter.
Several notable executives left Twitter in 2016, such as head of product Kevin Weil and Vine exec Jason Toff. Another key member of Twitter recently resigned: Adam Messinger, the company's CTO. In the wake of that news, Twitter's stock dropped 11.5 percent in December.
Twitter also laid off a significant chunk of its team late in 2016, showing the financial pressure the company is under.
Unless Twitter fixes its leadership issues, I don't think they'll be around too much longer. The way Facebook, which continues to be Twitter's measuring stick, has endured so much adversity is through a strong leadership team, led by CEO Mark Zuckerberg and COO Sheryl Sandberg. Twitter could easily benefit from a complete C-level team solely focused on Twitter.
Wall Street is Nervous
The weird thing about Twitter's value on Wall Street is that it only seems to take a generous jump anymore when there's a rumor about a potential new sale.
Its value hit a year-long high of $24.86 in October, after speculation that Salesforce's Mark Benioff was a potential buyer. That didn't last long, though.
After rumors of a potential white knight buyer were dispelled, Twitter's stock value tumbled terribly, now sitting at just over $16.
The growth just isn't there to excite investors. Twitter has yet to release its Q4 results, but Q3 was only mildly promising. Monthly active users -- a vital KPI for sites like Twitter -- grew by 3 percent year-over-year. Revenue also grew by 8 percent YoY. The company barely beat expectations, but it hasn't resulted in confidence from shareholders.
If they want to survive these next few years, Twitter needs to find some way to supercharge growth, both in terms of active users and revenue.
Facebook Could Kill Its Last Hope
Another key factor that could lead to Twitter-as-we-know-it not being around in a half-decade: its darling product, Periscope.
Periscope, Twitter's live-streaming app, has grown to impressive international usage. Twitter recently integrated Periscope into its apps, making it easier than ever for anyone to "go live," and broadcast to the world in live time.
Right now, Periscope is the hottest product Twitter has going.
Unfortunately, Facebook also has Facebook Live, and a massive marketing budget to make the product grow to scale. Both companies haven't released updated user counts lately, but it's evident that Facebook Live continues to eat up a lion's share of the livestreaming pie, simply by being available to a wider range of people.
This is a battle Facebook desperately wants to win, and it boasts a history of competitors bested (or bought) as evidence that the social media giant means business. I could definitely see Facebook totally overshadowing Twitter when it comes to the go-to platform for livestreaming. That may be Twitter's death knell.
While Twitter could surprise us all by solidifying its leadership team, developing ad platforms that energize brands and investors and stave off Facebook Live, I believe the most likely outcome for Twitter is to go the route of MySpace -- relegated to irrelevance.