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Can Twitter Survive By Becoming A User-Owned Co-Op? (salon.com)

Posted by EditorDavid on from the followers-vs-following dept.

What's going to happen now that Twitter's stock price has dropped from $66 a share to just $18? An anonymous reader quotes Salon: A small group of shrewd Twitter users and shareholders have come up with proposals to fundamentally restructure the way Twitter is controlled, to turn the company into a public service by removing the need to feed investors' ceaseless appetite for hitting quarterly growth benchmarks... Sonja Trauss, a Bay Area housing policy activist, and Twitter shareholder Alex Chiang proposed earlier this year a resolution for the company's recent annual shareholder vote to promote ways to get Twitter users to buy stock in the company, such as offering ways to buy shares directly through the Twitter website and mobile app. If many individual Twitter users each owned a small piece of the company, then they could participate collectively (through the annual shareholder voting process) in steering the direction of the company.

The idea makes sense from a labor standpoint. Twitter's value comes from user's tweets, which provides the backbone for digital advertising revenue. Twitter also sells this user-generated data to third parties that use it mainly for market research. This bloc of user-shareholders could theoretically overtake the control major institutional shareholders...have over the company. Because a lot of owners of a few shares of the company would have little to lose if the stock price doesn't grow or wavers, Twitter would be less beholden to meeting Wall Street's often brutal expectations.

7 of 124 comments (clear)

  1. That isn't... by 110010001000 · · Score: 5, Insightful

    That isn't a Co-op. It is just trying to sell stock to individual investors. These people have no idea how public companies are run. Unless you own a significant portion of the shares you aren't changing anything.

    1. Re:That isn't... by ceoyoyo · · Score: 2, Insightful

      "It only seems like a good deal for existing shareholders hoping to drive the price up a bit before they sell."

      That sounds like it's close to the right idea. The current owners don't see a future for Twitter and want to dump it. If they dump it, the company will probably go down and no more Twitter. This proposal is basically saying to the users, hey, if this thing is of value to you then buy a share or two. If enough of you do that, then Twitter won't die (this year).

      It's a way of getting money from users without saying the dirty subscription word.

  2. The rats are abandoning the ship by TimothyHollins · · Score: 4, Insightful

    Perhaps I'm being cynical here, but it almost sounds as if someone wants to unload his shares in Twitter onto the only demographic dumb enough to buy shares in Twitter.

    1. Re:The rats are abandoning the ship by Crashmarik · · Score: 5, Insightful

      Gee Comrade someone piss in your oats this morning ?

      Given the makeup of Twitter's shareholders and users it's much more likely you'd have nasty little groups with attitudes like yours trying to silence whoever they hate most at the moment.

  3. Won't work by Zontar_Thing_From_Ve · · Score: 4, Insightful

    Honestly I wish Twitter would just die and not be replaced with anything like it. I think society would be much better off in the long run and the media on the internet would stop acting like the opinions of nobodies who live in their parents' basements were crucially important. But on to the point at hand.

    There's nothing in this plan to stop institutional investors from buying up large numbers of shares and effectively gaining control and doing exactly what the proposers are trying to stop. It's hard to get people to pay for something they get for free and I just don't see users of Twitter being willing to pay to save it. There are 725 million or so shares of Twitter stock available. That requires an awful large number of people to buy 2 or 3 shares each. That's an unrealistic goal.

    1. Re:Won't work by gringer · · Score: 5, Insightful

      Twitter is like a cut-down version of a global IRC with fancy filtering. If twitter disappears, I expect that something else will quickly replace it.

      --
      Ask me about repetitive DNA
  4. Layoffs by Anonymous Coward · · Score: 5, Insightful

    How the hell does twitter lose money? Why does it have 2500 employees? What the hell does it spend $3 Billion a year on?

    The problem with twitter is cost containment. The folks running it don't know how to run a business, they just know how to court investors.

    I'm not calling for draconian MBA cuts that would gut the company, but I am generally curious on why they're spending ~$800 Million per year (2015) on RnD. Their product is already made, they only need a few people to make micro improvements to it. I don't see how they can justify spending the entire market cap of AMD in a year (2015 numbers).

    Cutting the RnD budget by 3/4ths would cut the redline in half, and would have no impact on their core product.

    I think MBA's running tech companies typically kill the company. But in this case, twitter really needs one of those slash and burn old school industrialist from non-tech industries.