360° Coverage : Twitter's Valley Of Thrones

Twitter's Valley Of Thrones

Jun 12 2014, 2:58pm CDT | by

Things are almost never what they seem when there are management changes at companies.

Earlier this week, David Marcus left his leadership job at PayPal to become a VP at Facebook.  Was it because – as was the dominant narrative in the press – he was attracted to a better job at a more successful company?  Or was it because Marcus’ boss, John Donahoe, got tired of PayPal’s performance and told Marcus he was fired but could save face by taking a job elsewhere and saying he was resigning?  Unless we’re inside the company, we will probably never know the answer.

We can speculate of course but we will never know.

It’s the same with what really happened with Scott Forstall and Tim Cook at Apple.

And it’s also the same with Twitter ex-COO Ali Rowghani who either quit this morning or was forced out.

If you thought the Game of Thrones was a great fictional tale which doesn’t happen in real life, the last 24 hours at Twitter show you otherwise.

Last evening, a tantalizing post from Kara Swisher at Re/Code came out discussing how Twitter was mulling some management changes including Rowghani thanks to the recent poor growth and engagement of its users which has caused Wall Street to gut the value of the stock since January (by about half).

You cannot read the Swisher post without coming away from it scratching your head about what a dysfunctional organization Twitter must be today.  I still love the Twitter service and will continue to be an active user.  And it appears that the company is doing a bang up job of making money from it as it continues to push ads in between our various comments and pictures of the ham sandwich we ate for lunch.

But Twitter’s not attracting new users and its engagement has been dropping off.  It’s been this way for about a year now.

It didn’t seem to matter in the run-up to the Twitter IPO – even though all the stats in the S1 pointed to it then.  Investors still wanted in to the deal because of the potential upside.

And it didn’t seem to matter when Twitter’s stock performed well on its first day or two months later when the stock traded up to $74 a share.

But since January, the stock has dropped like a stone and – as seen in the Re/Code story last night – the back-biting and hurt feelings inside the company have now spilled outside the company.

People apparently didn’t like that Rowghani – or someone else – referred to him as “Mr. Fix-It” in a Wall Street Journal article.  Folks at the quaintly titled weekly all-hands meeting, “#TeaTime,” complained that Rowghani sold some of his stock in May.  And I read today that people didn’t like Rowghani because he was a finance guy promoted to oversee product.

I won’t defend Rowghani since I don’t know him and don’t work inside the company.  However, the fact that this kind of complaining was going on to the point where it’s leaking out to the press is obviously a sign that there is something deeply wrong inside the company.  I’ve followed Yahoo closely for a long time and this last 24 hours has reminded me of the days when Jerry Yang was in charge and all kinds of gossip was spilling out into the press.

So, I have three conclusions about this mess.

1. People are as ruthless in real-life as they are in the Game of Thrones – it’s just that they don’t use swords.

There was a funny – and ironic – tweet that CEO Dick Costolo (a former stand-up comic) sent out 5 years ago before his first day on the job at Twitter reporting to Ev Williams as COO:

null

In Shakespearean plays, it’s often the fool who ends up speaking the truth about a particular situation.

Don’t forget that Cersai Lannister said this in the Game of Thrones:

Dick Costolo is still winning the game.  Ali Rowghani is no longer playing the game.  Maybe Rowghani’s departure has nothing to do with Costolo.  It’s possible but I think unlikely.  He would have to sign off on it so at the very least he’s a party to it.

2. Even if everything you have read about Rowghani being a bad fit or bad promotion is true, there’s still blood on the hands of Costolo from all this.  

Costolo ultimately hired Rowghani.  Costolo promoted him to COO. Costolo is the final guy charged by the board to grow users and engagement.  If one of Costolo’s direct reports fails to deliver on something, there is a final responsibility at the feet of Dick.

Whether Rowghani’s gone or not, Twitter still faces the challenge of increasing its users and engagement unless they of course turn their back on this strategy altogether and relegate themselves to a niche strategy.  A niche strategy would be like the Starks saying they only wanted to rule the North instead of the entire Seven Kingdoms in Game of Thrones.  It’s perfectly legitimate (as I’ve argued here).

The problem is that they’ve just IPO’ed, telling Wall Street that they will rule all the Seven Kingdoms.  And Wall Street gave them a lot of money to execute that strategy.  Twitter management can’t and won’t turn back now.

Rowghani’s departure today buys Costolo some time but Dick still probably only has until the end of the year to show some real meaningful progress.

3. Twitter’s growth and engagement problem won’t be easily fixed.  

The problem which sunk Rowghani and may sink Costolo isn’t an easy one to solve.  We can put anyone’s head on a spike out front of the castle and the fundamental problem is not going to change.

If Twitter increasingly Facebook-ifies itself, it risks losing its core users.  If it stays with the status quo that its core users love, grandmas won’t onboard.

Don’t let the bouncy balls, good cafeteria food, and pets sleeping between the cubicles fool you, Silicon Valley is just as ruthless as any Game of Thrones episode./>/>

[Long YHOO]

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

Fitbit Not Expected To Work With Healthkit
Fitbit Not Expected To Work With Healthkit
Apple’s new health tracking App won’t connect to Fitbit devices
 
 
Retailers Dropping NFC Readers To Stop Apple Pay
Retailers Dropping NFC Readers To Stop Apple Pay
Merchants are removing support for Apple Pay
 
 
AT&amp;T Showing Lack Of Vision With New SIM Cards
AT&T Showing Lack Of Vision With New SIM Cards
The company has busted the Apple SIM cards meant for travelers
 
 
The Stores of CVS and Rite Aid Stop Supporting Apple Pay
The Stores of CVS and Rite Aid Stop Supporting Apple Pay
CVS and Rite Aid are not accepting the service of Apple Pay from the last weekend
 
 
 

Latest from the Network

Storm forces evacuation of 1,000 people in Argentina
Buenos Aires, Oct 30 (IANS/EFE) The Argentine government Wednesday activated an emergency plan to help those affected by the powerful storm that struck 17 municipalities in Buenos Aires province over the past 24 hours...
Read more on Politics Balla
 
Melissa Rivers wants answers not money
Melissa Rivers wants answers about Joan Rivers' death. The TV producer, who is preparing to file a multi-million dollar wrongful death lawsuit against the Yorkville Endoscopy Clinic in New York City, where her mother...
Read more on Celebrity Balla
 
Robert Pattinson is moving back to London
Robert Pattinson is reportedly moving back to London to be with FKA twigs. The 'Rover' actor - who previously admitted he considers Los Angeles his home - is planning to relocate to his native England soon, as he is...
Read more on Celebrity Balla
 
Emma Watson was 'very nervous' before her feminism speech
Emma Watson was ''very nervous'' before speaking at the United Nations (UN) headquarters. The 24-year-old actress, who gave a speech about gender inequality as she launched the HeForShe campaign in her role as UN Women...
Read more on Celebrity Balla
 
Harry Styles is upset his vomit is being sold on ebay
Harry Styles thinks ''it's worrying'' his vomit is being sold on eBay. The 'Steal My Girl' hitmaker was surprised when fans erected a heartfelt shrine on the side of a busy Los Angeles freeway after he was recently...
Read more on Celebrity Balla
 
Ebola cases jumps to over 13,700: WHO
Geneva, Oct 30 (IANS/EFE) The World Health Organization (WHO) confirmed Wednesday that 13,703 people have been infected with the Ebola virus since the epidemic began in March. Of that number, 13,676 of the cases were...
Read more on Business Balla
 
Obama praises health workers fighting Ebola as 'heroes'
Washington, Oct 30 (IANS) US President Barack Obama Wednesday paid honour to healthcare workers who have treated Ebola patients in West Africa, calling them "heroes" deserving to be applauded rather than discouraged...
Read more on Politics Balla
 
Poland, Israel to step up efforts to further cooperation
Warsaw, Oct 30 (IANS) Polish Prime Minister Ewa Kopacz and visiting Israeli President Reuven Rivlin said Wednesday that their countries have agreed to step up efforts to further cooperation in various fields. The two...
Read more on Politics Balla
 
Cyprus, Greece, Egypt to forge tripartite cooperation
Nicosia, Oct 30 (IANS) Cyprus, Greece and Egypt Wednesday moved closer to forging a common strategy on energy, security and regional issues. Foreign ministers Ioannis Kasoulides from Cyprus, Evangelos Venizelos from...
Read more on Politics Balla
 
French soldier killed in clash in northern Mali
Paris, Oct 30 (IANS) A French soldier was killed Wednesday during a violent clash with a terrorist group in northern Mali, France's President's Office said. The sergeant in a commando parachutist unit was killed...
Read more on Politics Balla