Here's what the future holds for social media in 2016

Jack Dorsey will give up Square, Facebook will acquire Slack and Twitter will get back on track

Technology trends and news by Steven Loeb
December 30, 2015 | Comments
Short URL: http://vator.tv/n/4260

So another year has come and gone. With 2016 on the horizon, it's time for me to get out my crystal ball and try to predict for you, my readers, what will happen in social media over the next 12 months. 

Here are my predictions:

1. Snapchat will go public

Frankly, I believe that Snapchat is going to go public this year, not because it wants to, or even because it's ready to, but because it is going to have to.

2015 was a bad year for unicorns, as investors panicked over ballooning valuations, leading them to devalue some of the biggest companies in the world.

One of those companies was Snapchat, which raised a $538 million round this past May, valuing the company at $15 billion, making it the fourth most valuable private company in the United States, behind Uber, Airbnb and Palantir. Then, last month firm, Fidelity decided to write down the value of its stake by 25 percent, dropping it from $13.9 billion to $10.4 billion.

Given that kind of environment, some companies have be forced to go public, since investors will no longer allow them to rack up the same huge valuations they have for the last couple of years. 

"There are some companies on this year's list which may be forced to go public because the private markets may not be as welcoming to them. So this is the first year that we have companies on the list that may go public because they have to, not necessarily because they want to," Anand Sanwal, Co-founder and CEO of CB Insights, wrote in the company's 2016 IPO Pipeline report.

Look for Snapchat to be one of the companies. 

2. Twitter will start turn itself around

2015 was also a really tough year for Twitter. The company lost its CEO when Dick Costolo resigned and the was subsequently replaced by Jack Dorsey.

Twitter has been languishing for a while, struggling to get its user numbers back up. But right from the start Dorsey went into action, outlining "ambitious" and "bold" goals.

That included some major changes in features, which I'll talk more about later, while Dorsey also attempted to reverse years of animosity between the company and developers by reaching out to them and asking them to come back to the platform. He also gave a third of his stock in the company, which amounts to $211 million, back to employees

Of course, turning Twitter around isn't going to be quite that simple, but I believe that Dorsey's efforts will start to pay off in the next year. 

3. The presidential debates will go even deeper with social

There was a really interesting moment in one of the Democratic debates this year. Basically Hillary Clinton tried to say that the reason she takes so much money from Wall Street was because of 9/11. Yes, that really happened

Neither of the other candidates called her out for that jaw dropping statement, so it was up to social media to do it. CBS showed a Tweet from a random person, basically saying, "Did Hillary really just say that? You've got to be kidding me!" That forced her to defend her own statement.

Social media has taken a larger role in politics, and in debates, mostly through pre-screened questions. But that was the first time I remember a regular person being able to, in real time, call out a candidate on the debate stage.

That was made possible via a partnership between Twitter and CBS, allowing the network to use Twitter's curator tools to measure reaction, while also providing real-time data and insights.

There was also an official hashtag created, plus Twitter provided its users with an official list of all current candidates. The payoff: a candidate was held accountable for an outlandish statement on the spot.

I think we're going to see even more partnerships like this, with more networks taking deeper insights off of social media, and hopefully doing the exact same thing for every single sentence uttered by Donald Trump.

4. Snapchat will overtake Twitter

Honestly, this one isn't so much a prediction as a declaration. This will happen. It's only a matter of when. I think it will happen within the next year.

Just consider the rate at which the two companies are growing. As of the third quarter of this year, Twitter's total average Monthly Active Users (MAUs) were 320 million, up 11% year-over-year, and compared to 316 million in the previous quarter. 

Snapchat, meanwhile, is said to have 200 million active users as of this summer, up from 100 million less than a year prior. If it keeps that pace it will have more MAUs than Twitter by summer 2016.

In 2015 Instagram became bigger than Twitter when it announced that it had 400 million monthly active users, and I think the same thing will happen with Snapchat in 2016.

Still, Twitter has a secret weapon up its sleeve: according to the company, the number of people who visit Twitter each month without logging in is 500 million, 56 percent more than the number of people who have accounts. That number also includes people who click on links to Tweets in Google search.

That's why the biggest thing that Dorsey has done so far has been to, finally, start showing ads to logged out users, something the company has been talking about doing for over year. 

However one thing is clear: Twitter, which has always been touted as one of the biggest social networks, is in real danger of becoming an also-ran. 

5. Live video is going to explode

In March, Twitter made one of the splashiest social media moves of the year when it bought live video app Periscope. The app quickly became popular, and controversial, when it was used to illegally stream the big Mayweather Pacquiao fight in May. 

Not only did Periscope pass its 10 millionth account in August, with 40 years of video watched per daym, but it also spurred Facebook to launch its own version of the app, though only for celebrities at first (it has since been made available for all verified accounts)

Given all that, and the fact that live video streaming, it seems very probable that Facebook will bump up its capabilities in the area by buying Meerkat, the other live video app, which originally required a Twitter login, but which eventually transfered over to Facebook. There was a lot of speculation all year long that Facebook would go this route.

Either way, Twitter and Facebook are both making big investments in this area, and I expect there to be even more buzz around it in 2016. 

6. Twitter will go beyond the 140-character limit

The feeling I get around Jack Dorsey's tenure so far as CEO, it's that nothing is sacred. He is willing to mess with anything and everything if it means getting more people onto the platform.

He has also done things like start experimenting with reordering the timeline, but, more important are reports that have come out saying the company is looking to breaking the traditional 140-character limit, which would allow Twitter users to publish long-form content to the service.

Don't misunderstand. I don't believe that the 140-character limit will be going away completely, only that Twitter will go beyond it, giving users the ability to write long form content, either via a new product, or a new app, if they want to.

The 140 character limit is what gave Twitter it's hook. There are plenty of place on the Internet for long-form content, but here was a place where users would be forced to get their thoughts out in a limited and concise manner. Years later, though it has become clear that 140 characters is more of a burden than anything else.

Going beyonf 140-characters would be a great way for Twitter to grow. 

7. Social commerce will take off

2015 was also the year that the networks learned they are good for selling people stuff. Well, actually the trend started in 2014, ith the launch of buy buttons from both Twitter and Facebook, but both Facebook and Pinterest took that baton and ran with it in 2015.

In June, Facebook partnered up with Shopify to allow its merchants to advertise and sell their products and then, in October, it launched a dedicated shopping feed, creating a single place where users can more easily discover, share and purchase products.

Pinterest, meanwhile, announced that it was launching the Pinterest Shop, which will feature collections from different brands, including big stores like Bloomingdale’s and Nordstrom, as well as small boutiques like The Citizenry and Heist.

What's most interesting is that these will be curated collections, ones that will hand-picked by employees at Pinterest. It gives a human element that would not have been there if they were picked by an algorithm.

These are just early tests for these networks, so expect more features and products that revolve around shopping in the coming year.

8. Pinterest will not go public

Besides Snapchat, the only other social media company that is seen as potential IPO prospect is Pinterest.

Unlike Snapchat, has been around a while now, and has been making money for a couple of years. It has raised over $700 million and also has a high valuation of $11 billion.

Yet I don't think it has enough users at this point to take that next step. In September, Pinterest hit a major milestone, crossing 100 million monthly active users. Once a company hits that number,there's the feeling that they've gone from start up to established player.

Yet, let's look at how many users other networks had when they went public. Facebook had 845 million MAUs by the end of 2011, three months before it had its IPO. Twitter had 215 million MAUs, and more than 100 million DAUs. Only LinkedIn had less, with 90 million users. 

However, Pinterest has been showing ads for the last year, and if has been able to successfully monetize, especially on mobile, maybe the low user numbers won't matter. 

9. Facebook will buy Slack 

Both 2013 and 2014 saw Facebook make big, splashy acquisitions, first buying Instagram then WhatsApp. 2015 was a bit of a down year for the company in that regard, without a significant acquisition.

So if Facebook were to bounce back and buy a big company again, which would it be? My money is on Slack, which will soon be the company's main competitor when it fully launches Facebook at Work in the coming year.

Facebook at Work is the compan'y workplace collaboration servce. It was first released, in pilot mode, in January of 2015. Since then it has been invite only, and roughly 300 enterprise clients signed up, including Heineken, Stella and Dot, and Century 21.

Slack, meanwhile, has been one of the fastest rising stars in the tech world recently. Out of seemingly nowhere, the workplace collaboration tool raised its $120 million round last October, suddenly becoming a unicorn. Then it raised another $160 million valuing it at nearly $3 billion.

It's also been growing quickly. It had 1.7 million daily active users as of October, up 55 percent from the 1.1 million it had in June. It also has 470,000 paid seats, up 56 percent from 300,000.

If Facebook is serious about workplace collaboration, then buying Slack makes a lot of sense.

10. Jack Dorsey will leave Square

Here's where I get to put in the one prediction that I don't think will actually happen. 

As I said earlier, as much as Jack Dorsey is trying to fix Twitter, this is going to be really hard, especially when it comes to one group: Twitter's investors. They want user growth and they won't be happy until they get it.

In August, the stock ended trading under $30 for the first time ever, and except for a few days in October, has never been able to come back up. Then, earlier this month, the stock fell to its lowest point ever, dropping to $23.31 down 36 percent in a year.

The stock has continued to drop since then, going below $23. The company had a $26 IPO price and debuted at $45 a share in November of 2013.

Part of the problem might be Dorsey himself, and a profile by the Wall Street Journal that showed him not being able to give Twitter his full attention due to his other CEO job over at Square. 

It may come down to Dorsey being forced to make a Sophie's Choice, and go with one of his two public companies. While Square had what is being called the worst IPO of the year, I do wonder if perhaps will see Twitter as needing him more. After all, Twitter seems to be in sink or swim mode right now, and losing yet another CEO could prove fatal. 

So I predict that, should it come down to it, Dorsey will pick Twitter. 

So that's it everyone. I'll see you again in a year where I point out everything I got wrong!

(Image source: patch.com)

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