New York Magazine - USA (2021-02-01)

february1–14, 2021 | newyork 17

ads. Whether you approach the project of
reforming Twitter from the angle of
reducing toxicity or of growing revenue,
addressing one has the benefit of enhanc-
ing the other.
How realistic is all this? As of the third
quarter of 2020, Twitter’s annualized
advertising revenue was $3.2 billion. To
entirely replace that revenue through sub-
scription fees alone, Twitter would need
just under 15 percent of its 187 million
users to pay an average of $10 a month.
Investors have called for Twitter to adopt a
subscription model for years, and when
the company announced it was consider-
ing such a move last July, Twitter’s stock
jumped. But, true to lethargic form, when
asked for an update on the company’s
October earnings call, management’s
response was “You’re going to see us work-
ing on and experimenting with things.”
If Twitter focuses on users, not advertis-
ers, a host of opportunities present them-
selves. Today, the company provides no
tools for users to capitalize on the conversa-
tions they have and the connections they
make on the platform. So users are forced
to take valuable activity off the network.
Sensing low-hanging fruit, creator plat-
forms including Substack, Clubhouse, and
TikTok have moved in. Substack, founded
in 2017, already boasts 250,000 paying
subscribers for content and creators incu-
bated on Twitter. Recently, Clubhouse
announced it would be adding payment
processing, and TikTok said it had formed
a partnership with Shopify that will even-
tually allow merchants to sell products
directly through the app. Twitter has been
the gift that keeps on giving—to other
firms’ shareholders.
Twitter’s highest-profile new feature in
2020 was Fleets, an obvious Snapchat
knockoff that doesn’t make sense on Twitter
and has fallen flat in the marketplace.
I don’t know how much of its nine-figure
R&D budget Twitter spent on Fleets, but

I suspect it would have been enough to take

on the verified and expanded profiles proj-

ect, build a Substack clone, and simply buy

Clubhouse before its valuation exploded.

Perhaps the most obvious way for Twit-

ter to justify a subscription charge would

be to acquire or create its own content.

Both Spotify and Netflix’s stocks acceler-

ated once they began investing in their

own programming. Twitter is already a

destination for news and entertainment

content, and if it added its own—high-

quality political journalism, for example—

it could establish itself as the first truly

hybrid social platform, blending user-

generated and exclusive material. The

company has dipped its toe in these waters

before, airing NFL games in 2016 and

pursuing a broader array of partnerships

in a 2018 deal with Disney. However, as

investors have come to expect from Twit-

ter, these forays have gone nowhere.

on january 26, Twitter announced it

had acquired Revue, a Substack competi-

tor. This is a step in the right direction—if

management doesn’t again shepherd the

product to its graveyard of lost opportuni-

ties. Consider the breakout media firm of

2020: TikTok. Twitter had a similar prod-

uct, called Vine, but management shut it

down in January 2017, a year before Tik-

Tok began its ascent in the U.S. In 2015,

Twitter bought the livestreaming pioneer

Periscope and then mostly squandered it

while competitors including Facebook

Live and Twitch built businesses around

the concept. Efforts to reduce toxicity

have been similarly weak. Labeling false

or misleading tweets has had about as

much effect as the metal railings erected

around the Capitol on January 6. A

change intended to reduce rapid retweet-

ing was abandoned after just a few

months. Betas and vaporware with evoca-

tive names such as Bluesky and Bird-

watch have not had any impact.

This is what I mean when I say that

Twitter’s failure to deliver financial returns

to shareholders and its status as a threat

to democratic institutions are intertwined.

Executives and the entrenched members

of the board have simply failed. And so the

overhaul begins with this step: Jack

Dorsey must go.

Twitter’s CEO has repeatedly defended

the company’s embrace of the status quo.

When challenged about the platform’s role

in spreading disinformation, Dorsey posi-

tions Twitter as a neutral platform for a

global conversation. But he appears to have

little interest in how this is, or might be,

achieved. Less than a week before the 2020

election, when asked in a Senate hearing

how much Twitter spent on content mod-

eration, Dorsey admitted he did not know.

Even after the events of January 6, accord-

ing to the Times, Dorsey opposed banning

President Trump. He only acquiesced after

being pushed by senior members of his

team, and after his own employees com-

pared the company’s policy to that of Nazi

collaborators in the 1930s.

Dorsey oversaw Twitter’s response to

the Capitol rampage, according to the

Times, from a private island in French

Polynesia, furthering his reputation for

being a disengaged CEO. On the compa-

ny’s earnings calls, Dorsey can be nearly

silent. On the most recent call, he spoke

fewer than 6 percent of the words, accord-

ing to my analysis of the transcript. CEOs

of other tech companies, in my experience,

are typically responsible for around half of

them. Tellingly, Dorsey talks much more—

and appears substantially more engaged

and knowledgeable—during earnings

calls for the other company he is (also)

CEO of: Square.

I’ve served on more than a dozen public,

private, and nonprofit boards and led sev-

eral activist campaigns to replace direc-

tors at publicly traded media and technol-

ogy firms. Originally, I thought about

bringing these points up, as I did in

December 2019, in a letter to the board.

But activist letters typically end with a hol-

low attempt to claim the high ground and

state something to the effect of, “We look

forward to a productive dialogue and hope

we can work constructively together.”

I don’t. Twitter’s management, enabled

by legacy board members, has demon-

strated an obscene lack of regard for the

commonwealth, impotent strategic

thinking, and an inability to capture a

fraction of the shareholder value present

on the platform. I find management’s

actions—and inaction—irredeemable,

and that’s as both a shareholder and an

American citizen. ■

I’d pay a subscription

fee if Twitter thought

to ask for it. And

I believe@KimKardashian

would pay more.