Musk’s Twitter faces ‘unprecedented’ rise in competitors: MIT’s Sinan Aral
Elon Musk’s Twitter is facing a litany of challenges ranging from winning back advertisers who ditched the service to ensuring it can abide by a Federal Trade Commission (FTC) agreement to protect users’ privacy. And according to at least one expert, the negative attention is helping spur growth at competing platforms.
“We see an unprecedented rise in competitors to Twitter,” MIT Sloan School of Management Professor Sinan Aral told Yahoo Finance Live. “We have seen an unprecedented rise in folks using Mastodon and Post. We will see whether Twitter remains the primary source of townsquare conversation.”
Mastodon is an open-source, non-profit Twitter alternative, while Post is a news-centric social media platform that’s still in beta. You need to sign up for a waitlist to join.
Since Musk purchased Twitter for $44 billion in October more than half of the company’s workforce, around 7,500 employees, were either laid off or quit. Musk’s stance on reducing moderation on the platform, meanwhile, spooked advertisers, causing them to significantly reduce or cancel their ads on the service entirely.
“He basically abandoned content moderation, and you saw a lot of privacy, security, and safety staff flee or be fired,” Aral said. “This created an unprecedented increase in hate speech and misinformation. On the heels of that advertisers [fled] Twitter.”
Musk has also come under fire for suspending the accounts of journalists who reported on his decision to ban the @ElonJet account, which tracked the CEO’s private jet via public information.
On Sunday, Musk held a poll asking his 122 million followers if he should resign as Twitter CEO. Some 57% responded saying he should step down from the post. Musk has since said he would leave Twitter’s top spot, but only after he finds a replacement. And even then, he’d stay on to lead the software and server team.
“It’s a great thing,” Aral said. “He really had no idea what he was doing. He obviously is a great entrepreneur with a great track record at Tesla (TSLA) and SpaceX and other companies, but this one proved too hard for him.”
While Aral says that Musk’s Twitter is facing more competition, the CEO doesn’t seem all that concerned. In Nov., Musk said Twitter’s user numbers were at an all-time high and that signups hit a new record.
Now we’ll just have to see if those numbers can translate into meaningful revenue moving forward.
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