Why Twitter should become a non-profit organisation

Following months of speculation over the future of social media platform, Twitter, Patrick Hurley shares his personal view on which path the tech-giant should follow...

Why Twitter should become a non-profit organisation

Published —
10.25.16
Writer —
 For months, there have been rumours swirling in the pages of the international business press that Twitter is about to be bought out by some big tech giant or other. Amongst the dozens of names mentioned have been Google, News Corp, Salesforce, Amazon, Apple and Disney. And yet, no deal has been done by any of these potential suitors. Why is this, for what appears on the face of it to be a hugely successful business? 

A few suggestions spring to mind.

Firstly, Twitter has a reputational problem – it is increasingly thought to be unable to cope with a number of problems with its user base. Amongst these are the anti-social behaviour issues of individual anonymous super users – the trolls who routinely abuse those who get under their overly think skin; the scamming bots set up to tempt the unsuspecting into parting with cash or personal information; and perhaps most damagingly, the institutional political actors paid for by autocratic states to undermine democratic values.

Perhaps worst of all for Twitter’s chances of being acquired is the fact that all these issues come together to dissuade potential advertisers – essentially, the company’s sole external funding stream – from taking out ad space on the platform. And without sufficiently resilient revenue, there is little chance of a buyer meeting the wild valuations that tech companies currently maintain.

Twitter’s latest earnings are slated to be published on 27th October 2016, but if recent trends are anything to go by, they are unlikely to be pretty reading. The company lost over $100m in quarter two of 2016, and in over ten years of operating, has never once turned a profit. On this trajectory, it is unlikely ever to do so.

The most obvious solution, then, is for Twitter’s owners to accept the inevitable. It is a fundamentally unprofitable organisation with a product that, whilst socially useful, is not conducive to making money. Its backers have a bitter pill to swallow – either take the hit now on the money invested so far and accept that they will never see that money again, or continue to plough more and more money into a company that, at its heart, would be better off becoming the internet’s version of National Public Radio, or a social media version of Mozilla.

Twitter can’t seem to get on a sure footing in the ad-led capitalist world of Silicon Valley tech, even whilst all the significant players in the business-corporate industrial complex are glued to their smartphone screens. It has made itself at once both indispensable and a vacuum for speculative cash. It is, evidently, time for this dance to end.

Twitter’s owners, its financial backers, its senior team – all should recognise that the current structure of the business is not sustainable. All should recognise that ever more injections of investment would just be throwing good money after bad. All should recognise that Twitter’s modus operandi is as a public good, albeit one that has no private benefit.

Twitter should, therefore, set out plans urgently to end its current troubles by transferring its operation to a new non-profit organisation akin to Mozilla or Wikipedia, by announcing plans to offload the company at its true valuation – likely to be significantly less than the price it could currently command – and by relying for its revenue on donations and pledge drives from its user base of 300 million people worldwide.

This alternative path may not succeed. It may prove that social media must be uber-capitalist or not survive at all. But unless something changes significantly and soon, Twitter is unlikely to survive as a profit-driven enterprise, and its end would be both undignified and contagious. That would be the worst of all ends for the most revolutionary change to the way people communicate in over a hundred years.

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