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Sale or no sale, changes could come to Twitter users

Published:Sunday | October 30, 2016 | 10:00 AM
The Twitter logo appears on a phone post on the floor of the New York Stock Exchange, Thursday, October 27, 2016.

AP:

Sale or no sale, Twitter users are bound to see changes as the beleaguered communications service tries to broaden its appeal to more people and advertisers.

A new owner could clean up Twitter and curb some of the nastiness that's become synonymous with it. Or perhaps a new owner would just show more ads. Or let it languish while it mines the best of what Twitter now has into its existing products and services.

All of this is speculation, of course, and there might not even be a new owner. Twitter's stock has plunged after rumoured bidders are, well, rumoured to be no longer interested. On Thursday, the company announced that it would cut 9 per cent of its workforce globally as its revenue growth slowed.

While adjusted earnings beat Wall Street expectations, it reported a loss of almost US$103 million before one-time charges and costs are removed.

A new parent whether that's Google, Salesforce or Disney could inject fresh life into a 10-year-old company that's never turned a profit and remains confounding to many people. Of course, none of these potential suitors have acknowledged interest in Twitter, let alone their plans for it. Even if Twitter stays independent, drastic changes to its service might just be what Twitter needs to be competitive with Facebook, Instagram and Snapchat.

How might it change?

Facebook's absorption of Instagram and WhatsApp in recent years could offer clues. Both services have kept separate identities, to an extent, and have experienced user growth. But slowly, they are acquiring Facebook-like features. For example, Instagram no longer presents feeds chronologically; they are now sorted much like Facebook's news feed, using some secret formula known only to Facebook.

Though the change has turned off some early Instagram users, its user base has soared to 500 million as of June. That's nearly 200 million more than Twitter, even though Instagram is three years younger. Twitter has never turned a profit, and whoever buys it will need to fix this. That means boosting the user base, so advertisers would follow. That also could mean better targeting, so that ad rates go up.

YouTube hardly had any ads when Google bought it; now, ads are so prevalent that YouTube is able to charge US$10 a month for an ad-free version called Red.

Instagram has also inserted ads into users' feeds of perfectly composed snapshots featuring everything from cappuccino foam to sea foam. It started out slowly with a carefully curated ad here and there, but today you're not likely to avoid ads when opening the app.

Salesforce, a company that provides Internet services to businesses, has also been mentioned as a contender, leading to a lot of head-scratching among users. Would Twitter become a business product, used for customer service and marketing instead of revolutions, neo-Nazi memes and political outbursts?

"Salesforce is a very technology-driven company," eMarketer analyst Debra Aho Williamson said. "It seems they would want (Twitter) mostly for the data that Twitter has."

Remember MySpace? It was the social network before Facebook came along. News Corp, the stodgy media conglomerate, bought it for US$580 million in 2005, but users started falling off as MySpace failed to keep up with Facebook's speedy innovations. After layoffs and failed relaunches, News Corp. sold the fallen giant for US$35 million in 2011, and that was just about the end of it.

It's not unthinkable that Twitter could suffer the same fate under a big media company.

Walt Disney's reputation as a squeaky-clean, family-friendly company is perhaps the clearest antithesis to Twitter's soul, as many users see it even though Disney is much bigger than Mickey Mouse and owns ABC, Marvel and the "Star Wars" franchise, among other properties.

"My chief fear is that Disney will wield Twitter as one large PR machine to prop up their image and squash dissent," said Timothy Hayes, an Ohio State University student who says he fell in love with Twitter in high school. "The Mouse is not above silencing opponents."