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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.

11 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 nine-times · · Score: 4, Interesting

      Yeah, I'm not sure how this is supposed to work with a publicly traded company. Like, ok, users buy a bunch of shares, and then what? If it looks like it's driving up the price, it's just going to encourage a bunch of speculators to buy in. The fad passes and the buying-spree ends, and the price drops again. Any of the users who bought in still don't have control, and meanwhile have probably lost money. And even that's only if a substantial number of users buy into it.

      It only seems like a good deal for existing shareholders hoping to drive the price up a bit before they sell. Am I wrong? Am I missing something?

  2. get the news organisations to pay by Anonymous Coward · · Score: 4, Interesting

    after all they spend most of the time telling me what some fuckwit on twitter thinks about something. or a celebrity fuckwit thinks about something else.

    easier than doing some research and writing some content, eh?

  3. 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.

  4. 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 Entrope · · Score: 4, Interesting

      The most serious problem with Twitter is not who gets involved or who it highlights. It is Twitter's core approach to conversation. 140 characters do not provide enough room to make a real argument or explain anything in detail. Instead, posts devolve into cheap point-scoring and the use of slogans that signal one's tribal affiliation. This pushes people out of the "middle" and towards some outlier perspective -- maybe "pro" or "con" on the original question, or maybe "con" on the Internet or humanity in general.

    2. 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
  5. 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.

    1. Re:Layoffs by laughingskeptic · · Score: 5, Interesting

      Spending huge on RnD is a Wall Street requirement for tech companies. If you are not spending huge on RnD your multiplier is slashed and your stock craters. The assumption (which is almost always wrong) is that the RnD will lead to another product from the same geniuses that brought them the current product. In the early 1990's BMC was not getting the respect they thought they deserved from Wall Street and they figured out that all they had to do was spend money to get their stock price to triple. So they did. They set up an entire new office in Austin that pretty much just spent money and they called it RnD and their stock price went up. If Twitter slashes their RnD now, Wall Street will kick them to the curb. Twitter may be over-doing their RnD spending, but the amount they spend is likely driven by communications that they have had with institutional investors.

  6. Re:Confused about it by TimothyHollins · · Score: 5, Funny

    The amazing thing about Twitter is that when you are forced to condense your thoughts into piece-meal slogans you are forced to truly consid