TweetDeck Can't Cure Twitter's Zero Growth Problem

 Although Twitter, Inc. (TWTR) is just over a decade old, it is decidedly mature in social Internet years. It has reached a critical developmental stage — perhaps a crisis point —where its value is driven by the monetization of existing users -- not by the mere attraction of new ones (a task that has proven increasingly difficult). While Twitter’s revenue ($2.53b and +14% Y/Y in FY2016, compared to +58% Y/Y in FY2015) has not yet begun to decline, the firm has never been profitable and does not show any imminent signs of being so under part-time CEO Jack Dorsey.

Over the past six months, Twitter has gone from a potential M&A-driven 52-week high of $25.25 to a close today (28 Mar 2017) of $14.94, all of which has increased public and investor pressure on Dorsey and his team to either perform or let someone else handle the reins full-time.

Enter TweetDeck

In an effort to better serve the needs of its power users, and add revenue, Twitter recently announced it was considering an enhanced/paid version of its once-popular TweetDeck interface, which it backed up with the release of an exclusive user survey (which included yours truly). The survey was revealing (and a bit unsettling) regarding Twitter’s TweetDeck plans, and leaves us less than confident that the firm has a strategy behind this tactical move.

Per the survey:

“Twitter is considering offering an advanced TweetDeck experience, with more powerful tools to help marketers, journalists, professionals, and others … find out what is happening in the world quicker, to gain more insights, and see the broadest range of what people are saying on Twitter,”

This is a clear nod to the consumption-driven power user, and ad-free, no less. But it also promises:

“valuable viewing, posting, and signaling tools like alerts, trends and activity analysis, advanced analytics, and composing and posting tools,” a clear nod to the engager/publisher user.

Can Twitter nail two birds with one stone?

Not from our perspective.

For those who are not hardcore Twitter fans, TweetDeck is a console interface for Twitter that allows real-time management of multiple accounts and far superior list tracking than Twitter’s standard web or mobile interfaces. TweetDeck was the brainchild of Iain Dodsworth, initially released in 2008 and later acquired by Twitter in 2011. It has been my personal favorite Twitter tool since the first iOS/iPhone version was released in 2009, as its utility as an aggregator of Twitter feeds/searches is undeniable.

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Disclosure: I am/we are long FB, MSFT; I am/we are short AAPL. 

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Kurt Benson 3 years ago Member's comment

Excellent analysis of the challenges facing #Twitter. $TWTR

Fred McClimans 3 years ago Contributor's comment

Thanks, Kurt - I appreciate the feedback! Twitter is one of those companies/equities that has had tremendous potential. As a user, I rely upon it every day. As an investment, however...