Twitter looking beyond 140 characters with new product: Report

30 Sep 2015 | Author: | No comments yet »

Chorus grows for Dorsey to remain Twitter chief.

Micro-blogging website operator Twitter Inc is working on a product that will allow users to share content longer than 140 characters, technology website Re/code reported on Tuesday. We’ve heard this rumour many times before but, according to multiple sources speaking to Re/code, the microblogging site will bite the bullet in a bid to grow its user base after having apparently mulled over the decision for some time.

In August, Twitter announced that it was ditching the 140-character limit on direct messages, the so-called “private side” of the social media giant that lets users communicate with one another privately. Twitter said that the reason behind this was to let users have private conversations about whatever is unfolding on Twitter, “making the private side of Twitter even more powerful and fun”. The form of the ‘product’, which the Re/code sources say would allow tweets to be extended, would enable Twitter users to publish long-form content to the service, although it is not yet clear what the product will look like. It’s also reportedly planning on redefining “characters” so that some things in a tweet, like user handles and links, don’t count, thus giving users a way to cheat the limit. It has also been said that, in addition to the long-form product, Twitter big cheeses have been discussing the idea of tweaking how Twitter measures its 140-character limit by removing things like links and user handles from the count.

The lack of growth in the number of Twitter users has been a concern among shareholders, who have seen the value of Twitter shares decline from an all time high of $73 in December 2013 to its current range of about $24 to $25. While Dorsey has long been mentioned as a candidate, one hurdle to his getting the job has been the perception that he is too overloaded because he is also managing Square. According to Re/code, “Twitter is desperate to find new ways to attract users to the product.” Twitter currently reports 316 million monthly active users and 500 million tweets per day. He will not be distracted by running two tech companies at the same time and can juggle the work, they said. “After watching Jack execute on his vision at Square, and more recently at Twitter as CEO, we are highly confident in Jack’s ability to serve as CEO of both companies,” Justin Dini, a spokesman for Rizvi Traverse Management, said Monday. Dini said the firm not only had faith in Dorsey but also continued to invest in Twitter because of its belief in Adam Bain, Twitter’s president of global revenue.

And there may be an internal struggle underway over the proposal. “One of the main issues the company is grappling with,” said the Journal, “is by how much it should extend the limit and how that should look, a decision that could alter the basic Twitter experience, these people said. Rizvi Traverse’s support for Dorsey is significant because the investment company, which is run by Suhail Rizvi, a famously private investor, was Twitter’s single largest outside shareholder at the time of the company’s initial public offering in 2013. One camp is in favor of simply increasing it by 10 or so characters, while another camp would rather take the time to devote resources to building a rich publishing platform that could perhaps be monetized one day.

The 15.6% stake Rizvi Traverse held in Twitter has shrunk to less than 5% after the firm disbursed Twitter shares to its individual investors, but it remains a big investor in Square. The investor declarations backing Dorsey as chief executive of Twitter and Square increase the pressure on Twitter’s board, which said in June that it would consider only candidates for the job “who are in a position to make a full-time commitment to Twitter.” The statement would seem to have ruled out Dorsey, who had said that he did not plan to step down as Square’s chief executive.

While Twitter’s board was initially mixed about Dorsey returning to run the company, some board members are warming to the idea, according to three people with knowledge of the board’s discussions, who also spoke on the condition of anonymity. That has put the board in something of a bind because if directors reverse their position and pick Dorsey, it could make Twitter vulnerable to shareholder lawsuits from anyone claiming to have bought the stock based on the assurance that the company would have a chief who was fully committed to it. Dorsey is likely to soon begin pitching Square to public market investors at an IPO roadshow, and a public offering is expected before the end of the year, according to two people knowledgeable about the situation. Three months is not an unusual length of time to be seeking a new leader; it took Microsoft about six months to appoint Satya Nadella chief executive last year, after the resignation of Steve Ballmer.

Many advertisers are waiting to commit additional marketing dollars to Twitter until a permanent leader and strategy are in place, said Robert Peck, an internet analyst with SunTrust Robinson Humphrey. Last week, analysts at Citi Research slashed their advertising revenue estimates for Twitter and downgraded the stock to high risk.” Twitter shares closed Friday at $25.29, below the IPO price of $26. “The public shareholders just want to see this move along here,” Peck said. “Investors have come to terms with a CEO of Twitter that is also a CEO of someplace else, whereas that wasn’t the case a few months ago.”

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