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Twitter has suffered setbacks, but Dorsey has been working hard to change the service for the better
This past weekend was an important one for Twitter, as Saturday was the one year anniversary of Dick Costolo resigned as CEO of Twitter. Co-founder Jack Dorsey would take over in an interim basis at the beginning of July, before taking the position perminently in October.
A lot has happened to Twitter over the past year, some good and some really not so good. In that time. the company's stock has lost nearly 60 percent of its value, and numerous executives, while Dorsey has also been tweaking the service and trying to make it more palatable for new users.
This is what Dorsey has been up to over the last year:
Dorsey's reign got off to an interesting start, and one that seems like a metaphor for what has been going on at company itself.
Twitter beat expectations in its Q2 earnings report in Dorsey's first month as CEO (of course, any of that success would have happened under Costolo's watch), sending its stock up, before Twitter's age-old problem of stalling user growth, and comments from CFO Anthony Noto, causing the stock to come back down to Earth.
"We're working as rapidly as we can to put us in a position to launch an integrated marketing strategy and marketing campaign before the end of 2015," Noto said. "To be clear, however, we do not expect to see sustained, meaningful growth in MAUs, until we start to reach the mass market. We expect that will take a considerable period of time."
It's a pattern that will repeat over and over: no matter what successes Twitter may have, its inability to get its user numbers to grow will continually come back to haunt it.
August 2015 - shares drop below $30
August started out on a sour note, a Twitter's stock ended trading under $30 for the first time ever. However it also continued to lay the seeds for one of its most important media partnerships..
The company entered into a new multi-year partnership with NFL in August, allowing Twitter to deliver uniquely packaged official NFL video and other types of content to fans daily, on a year-round basis.
Twitter had already partnered up with the NFL in 2013 through the Twitter Amplify program, its video advertising product that it had launched for media companies and consumer brands. This relationship will eventually come up again later, and in a big way.
October of 2015 would be huge for Twitter,and its future growth. Not only is it when Dorsey made his second reign as CEO of Twitter permanent, it also saw the debut of Moments, previously known as "Project Lightening," a feature that is designed to curate content by aggregating Tweets and photos from live events and breaking-news situations.
In a conference call, following the company's Q3 earnings, Dorsey would call the product "a real, fundamental shift in our thinking," and something that be simplify the product. That last piece is a core principal that Dorsey has been running on during his time as CEO.
That same month Dorsey took a big step and apologized to developers for how his predecessor had treated them. The company had had a rocky relationship with them ever since it released its updated API in 2012, which put a multitude of restrictions on third-party developers, and limited their access to new users.
“We want to come to you today and apologize for the confusion. We want to reset our relationship and make sure that we’re learning, listening, and that we are rebooting. That’s what today represents. We want to make sure that we have an open, honest, and transparent relationship with developers," Dorsey said.
It wasn't only developers that Dorsey realized he had to get on his side, but employees as well. That's why he pledged to give away a third of stake in Twitter back to the companys workers. The plan would eventually be approved in May of this year, but would do little to keep Twitter's leadership team from leaving.
Despite all of these efforts, Twitter again was faced with the harsh reality of its user growth problem. Despite easily beat expectations in terms of revenue and EPS, it got slammed after its Q3 earnings report due to slowing user growth, adding only 4 million MAUs during the quarter.
December would contain at least two incidents that can, in retrospect, be seen as signs of what was to come at Twitter.
First was the announcement of the departure of Mike Davidson, Twitter's Head of Design. This was a big blow for Twitter, as Davidson was in charge of user experience of all products and services at Twitter, something that Dorsey was already starting to put an emphasis on, though they would not be fully implemented under 2016.
In addition to Davidson, Twitter also lost engineer Utkarsh Srivastava, who helped the company build its ads business, and Glenn Otis Brown, who had been heading up Twitter’s video ad program, within the span of two weeks.
The other bad sign had to do with Twitter's stock which fell to $23.31 a share, its lowest closing price ever until that time.
The month wasn't all bad, though, as Twitter also announced a potential solution to its user growth problem: Promoted Tweets for logged out users. Logged out users are a big source of potential revenue: according to Twitter, 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.
January 2016 - mass exodus
January was not a good month for Twitter.
A slew of executives jump ship en mass, including Katie Jacobs Stanton, the company’s VP of global media; Kevin Weil, it's SVP of product; Alex Roetter, who is and SVP of engineering, and Brian “Skip” Schipper, Twitter's Vice President of Human Resources, all of whom chose to leave Twitter at the same time.
Beyond bad optics, the incident caused Twitter to be downgraded by Scott Devitt, analyst at Stifel.
"While we may not be the sharpest tools in the shed, we don't see how the departure of the heads of three major business divisions can be viewed as a positive in the middle of an attempted business turnaround," he wrote in a note.
Of course, there was at least one piece of good news: Leslie Berland, Executive Vice President, Global Advertising, Marketing & Digital Partnerships at American Express, came on as the new chief marketing officer at Twitter.
Rumors about Twitter altering some of its most fundamental aspects, including its real-time feed and its 140-character limit, had been going on since Dorsey took over.
In 2016, he finally started putting some of those changes into practice, starting by altering the timeline.
Users were given the ability to change their timeline to display those that they were most likely to care about, rather than just the most recent. The feature was not mandatory and users were given the ability to opt-in.
That same month, Twitter also brought on ,Apple-veteran Natalie Kerris as its new head of communications.
However both of these positive developments were undone by Twitter's worst quarter for user growth yet, where depending on how you look at it, Twitter's users either stayed flat, or actually declined, from the previous quarter, sending the stock down over 10 percent. This was the first time this happened.
After multiple reports surfaced over the previous few months that Dorsey was looking to get rid of one of the most deeply embedded, and fundamental, features of Twitter, it's 140-character limit, Dorsey announced that the feature was staying.
“It’s staying,” he said. “It’s a good constraint for us, and it allows for of-the-moment brevity.”
Twitter's relationship with the NFL came in handy as the two entered into a streaming partnership, allowing Twitter to stream the 10 Thursday Night Football games that are broadcast by NBC and CBS this year. In addition to live streaming video, the partnership also includes in-game highlights, and pre-game Periscope broadcasts from players and teams.
Another one of the hallmarks of Jack Dorsey's time as Twitter's CEO has been a bigger commitment diversity. In April it added the second woman to its board of directors, bringing on Martha Lane Fox, co-founder and managing director of lastminute.com.
It also added High, Johnston, Vice Chairman and Chief Financial Officer of PepsiCo.
In its Q1 earnings, Twitter saw its average MAUs grow a mere 3 percent year-to-year to 310 million, and up only 1.6 percent from 305 million last quarter.
May is when Twitter, finally, made good on all the rumored and proposed changes to how it would be used.
While Dorsey made it clear he wasn't keeping the 140-character limit in place, it didn't mean it couldn't still be tweaked. In May, it was announced replies and media, such as photos and videos, would no longer be included in the character limit. That meant names would not be counted, and neither would any media, including photos, GIFs, videos, polls, or Quote Tweets.
In addition to revising the character count, Twitter also made good on its promise to change what Dorsey had called one of Twitter's "weird rules," that had been preventing new people from joining the platform.
Specifically, he had called out the rule that stated that if someone started a Tweet with an "@" then only followers of the person Tweeting, and those of the person mentioned, would see the reply. To get around this, many users simply put a "." in front, since it's barely noticeable, and it would make sure that everyone would then see the reply.
The company changed the rules, so that Tweets that begin with a username will reach all followers, getting rid of the workaround.
Finally, the company also added a Retweet button, so that users can more easily share their old Tweets, pushing them back to the top.
The same month, Twitter also made its board even more diverse by adding BET CEO Debra Lee.
Despite all of these advancements, Twitter's stock fell to its lowest ever, hitting $14.1 a share.
As Twitter's user growth continued to be anemic, it was inevitable that some other networks would eventually pass it.
(Image source: dribbble.com)
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What is Twitter?
Twitter is an online information network that allows anyone with an account to post 140 character messages, called tweets. It is free to sign up. Users then follow other accounts which they are interested in, and view the tweets of everyone they follow in their "timeline." Most Twitter accounts are public, where one does not need to approve a request to follow, or need to follow back. This makes Twitter a powerful "one to many" broadcast platform where individuals, companies or organizations can reach millions of followers with a single message. Twitter is accessible from Twitter.com, our mobile website, SMS, our mobile apps for iPhone, Android, Blackberry, our iPad application, or 3rd party clients built by outside developers using our API. Twitter accounts can also be private, where the owner must approve follower requests.
Where did the idea for Twitter come from?
Twitter started as an internal project within the podcasting company Odeo. Jack Dorsey, and engineer, had long been interested in status updates. Jack developed the idea, along with Biz Stone, and the first prototype was built in two weeks in March 2006 and launched publicly in August of 2006. The service grew popular very quickly and it soon made sense for Twitter to move outside of Odea. In May 2007, Twitter Inc was founded.
How is Twitter built?
Our engineering team works with a web application framework called Ruby on Rails. We all work on Apple computers except for testing purposes.
We built Twitter using Ruby on Rails because it allows us to work quickly and easily--our team likes to deploy features and changes multiple times per day. Rails provides skeleton code frameworks so we don't have to re-invent the wheel every time we want to add something simple like a sign in form or a picture upload feature.
How do you make money from Twitter?
There are a few ways that Twitter makes money. We have licensing deals in place with Google, Yahoo!, and Microsoft's Bing to give them access to the "firehose" - a stream of tweets so that they can more easily incorporate those tweets into their search results.
In Summer 2010, we launched our Promoted Tweets product. Promoted Tweets are a special kind of tweet which appear at the top of search results within Twitter.com, if a company has bid on that keyword. Unlike search results in search engines, Promoted Tweets are normal tweets from a business, so they are as interactive as any other tweet - you can @reply, favorite or retweet a Promoted Tweet.
At the same time, we launched Promoted Trends, where companies can place a trend (clearly marked Promoted) within Twitter's Trending Topics. These are especially effective for upcoming launches, like a movie or album release.
Lastly, we started a Twitter account called @earlybird where we partner with other companies to provide users with a special, short-term deal. For example, we partnered with Virgin America for a special day of fares on Virginamerica.com that were only accessible through the link in the @earlybird tweet.
What's next for Twitter?
We continue to focus on building a product that provides value for users.
We're building Twitter, Inc into a successful, revenue-generating company that attracts world-class talent with an inspiring culture and attitude towards doing business.