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The little Twitter blue bird may very well be facing the threat of extinction.
2016 has brought some rather ill tidings for both the Twitter messaging company, as well as the Square mobile payment service, with shares suffering from rather hefty drops. Due to this, Twitter’s CEO Jack Dorsey is no longer a billionaire while his Square company is teetering on the financial tightrope it is currently walking on.
The total losses of Dorsey are marked at $500 million, encompassing both companies. In regards to shareholdings in Twitter, they have dropped by 35% in just the past month, estimated at about $165 million. Market analysts believe that this plummet will continue in the following months because stock in general is believed to suffer from a decrease in February and March.
Square suffered from a 35% decrease as well, with shares dropping an additional 8% on Wednesday this week. Jack Dorsey’s 20% stake in the company was lowered at the level of $330 million. This is due to investors’ belief that Square is not a profitable investment due to its gigantic competitors, for instance, Apple and Google.
But this phenomenon is not limited to Twitter and Square. Other companies that dabble in this side of the market have suffered from a poor 2016 start as well. Fitbit, Under Armour and GoPro, have all been welcomed at the start of 2016 by a share decrease due to both consumer disinterest as well as a drying up capital.
Twitter’s misfortune was also sparked by its service outages from Tuesday. Although the technical problem was resolved within two hours, several outages were still surfacing throughout the day, welcoming users with a page stating that “something is technically wrong”. This made investors thoroughly consider if Twitter is capable of maintaining a steady flow of service throughout the year, thus lowering the company’s share values.
In order to quell this decrease by a certain margin, Twitter has announced plans that will hopefully push their service to new heights. The plans are based on thinking outside the box, removing the 140 character limit on posts, as well as remastering and upgrading its advertising model. But the problem created by this plan is the fact that Twitter is known for short and to the point messages.
If it adopts a common means of displaying messaging posts without a character limit, Twitter might have nothing to differentiate itself from Facebook’s messaging systems or other similar companies’ practices.
Even if Twitter’s CEO Jack Dorsey is no longer a billionaire, hopefully for both him as well as his company, this will somewhat balance itself out in the later months of the year. If this will not happen, we might be seeing the death throes of Twitter as we speak.
Image source:www.pixabay.com
