In January, investors got a nice surprise when a report surfaced that the social media platform planned to increase its flagship 140-character limit to 10,000 characters.
The limit, while central to Twitter’s product, is restrictive to the network’s ability to grow its user base. Some people simply don’t have the patience to try to condense their thoughts into just a quick sentence or two.
In a recent interview, however, chief executive and co-founder Jack Dorsey made it clear to reporters that the company has no plans to lift the 140-character limit. Some are of the opinion that this decision is a good thing.
"I'm glad to see them sticking with their 140-character tweets," says Jeff Kagan, an independent industry analyst. "That's Twitter. Remove that and Twitter starts to get watered down and blends in with everyone else."
Further, Kagan concludes, "I think 140 characters is plenty. You can add links and you can add a second tweet if you need more room. Twitter is all about brevity.”
Why it’s still a problem
I’ll agree with Kagan: That’s Twitter. The problem with that statement, however, is that Twitter isn’t doing well. It’s monthly active user growth from Q1 2015 to Q4 2015 was just under 1%. People aren’t interested enough in Twitter as it is to start using it.
When Jack Dorsey returned, investors cheered, albeit cautiously. Despite the man’s former issues before he was ousted in 2008, many were happy to hear him talk about implementing product changes that would make Twitter more universally liked.
The problem is that nothing of that sort has happened since he returned in October 2015. Sure, there have been a few minor changes, like Twitter Moments, which has begun to include pointless celebrity Twitter spats, and the ability to add a gif to your tweet. But the network’s core product is still the same, and it’s doubtful it will change anytime soon.
Not going anywhere anytime soon
Despite this distinctly bearish assessment of Twitter’s current state, that doesn’t mean it’s going away anytime soon. I recognize that Twitter has a very tight grip on certain things. For example, it’s generally the preferred way for celebrities and influencers to interact with the public. Also, Twitter has gotten a stranglehold on the instant news feed space and I doubt it will let go.
"Their success in their 10 years is a testament to their early focus on mobile and establishing themselves as the go-to community for real-time news and events," says Brian Blau, an analyst with Gartner. "That is a fairly powerful position to be in."
The company has also managed to continue to grow its advertising revenue despite issues with user growth. There’s a reason the stock is sitting 35% below its IPO price, though. Going forward, user growth is going to continue to drive the company’s stock. While there may be a bump up here or there when we see good news about advertising come out, the company has to solve its user problem by solving its product problem, otherwise it will stay the same.
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