What is Twitter’s New Business Model?

Major changes are announced by Twitter. The company is cutting back on staff and reorganizing its leadership. But will it find a new Business Model?

One of persistent questions in the business press has been ‘what is Twitter’s business model?’ The company has grown sensationally but always on its potential to make money rather than short-term profit. In that respect it is similar to Amazon. LWD subscribers will find several posts on this topic.

Turnover of senior executives

Over the last few months there has been a rapid turnover of senior executives at Twitter. Its head Dick Costelo departed in July when a Board reshuffle saw its brilliant entrepreneurial co-founder Jack Dorsey return in a transition role as CEO.

This resulted in a sideways move for a Twitter insider Adam Bain, who was considered a candidate to take over from Mr Dorsey who was seen as more of an ideas man with great inspirational and motivational skills.

Then earlier this month, [5 October 2015] Dorsey’s interim position was reclassified as a permanent one as CEO. This left unresolved a possible clash of interests with his involvement with Square, a fast growing mobile payments company in which he still retains executive responsibilities. As the new CEO, Mr Dorsey acted swiftly and announced major staff reductions at Twitter in a major restructuring plan.

Here comes Omid

One week after his appointment, Mr Dorsey also announced the arrival of Mr Omid Kordestani, an influential figure at Google whose reinvention of its corporate self as Alphabet may have contributed to Kordestani’s move to new challenges at Twitter.

Outsiders considered that further moves are required to give the company stability and coherent leadership. The official role of Mr Kordestani is as executive chairman. It remains to be seen how the leadership roles at Twitter will play out, and how the Company will redefine its business model.

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One Response to What is Twitter’s New Business Model?

  1. Paul Hinks says:

    Hi Tudor-

    When Twitter floated so the spotlight was focused more keenly on the balance sheet, revenue growth and ultimately profit.

    How to satisfy the short term demands of Wall Street versus investment in longer term product development is a dilemma in it’s own right.

    Twitter isn’t a public service, but it many ways it feels that way.

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