Twitter's Costolo Years: An Annal of Missed Opportunities

In 2010, Twitter seemed like a peer to Facebook; now, it’s a pitiful also-ran. What happened?

Twitter's outgoing CEO, Dick Costolo, in 2012 (Lionel Cironneau / AP)

Oh, but what is to be done with Twitter.

On Thursday, in a press release posted to its eponymous social network, Twitter Inc. announced that its CEO, Dick Costolo, would resign. Jack Dorsey, one of the company’s founding quadrumvirate and the company’s first CEO, will take his old job in an interim role.

Some investors have called for Costolo’s resignation for more than a year, calls which became more strident after extremely disappointing quarterly results in April. (Twitter's weaker-than-anticipated growth was dismal enough that it drove down stock prices 18 percent that day.) By appointing Dorsey as acting executive, the company seems to be hearkening back to the idealism of its early days.

Yet Dorsey’s naming means, too, that it will be hearkening back to early drama. The half-decade which followed Twitter’s founding in 2006 was marked by strange and petty power struggles among its founders. According to Nick Bilton’s history of the period, Hatching Twitter, Dorsey could be a distracted, showboating leader, missing company activities to attend yoga and fashion classes. Another cofounder, Evan Williams, even told him, “You can either be a dressmaker or the CEO of Twitter. But you can’t be both.”

By 2008, Dorsey was out and Williams was CEO. Two years later, Williams himself would leave (though remain on the board) and Costolo—then the company’s chief operating officer, hired from Google—would become CEO. Dorsey also rejoined the board. Now nearly five years later, the company remains incestuous: Of its eight board members, three are former CEOs.

This is all to say: Twitter isn’t in the clear yet, and if investors were looking for a caretaker executive as interim, they didn’t seem to have gotten one.

So what did Costolo accomplish during his five years? The headline is: He took Twitter public, a messy process that created a lot of wealth for bankers and some of its early investors. To his credit, he also continued its advocacy for freedom of speech. Twitter, alone among social networks, does not take down content when ordered to by a national government but merely blocks it from being seen in that country. It also publishes some of the best, most exhaustive data about the government requests—censorship, copyright, or user data-related—it receives.

But to recount the last five years of Twitter’s history is to create an annal of missed opportunities. Twitter seemed, almost systematically, to frustrate those who saw themselves as the company’s allies—or, at least, its most loyal users. After encouraging developers to build applications around the service for many years, it altered who could access its data, creating an atmosphere of instability for any third-parties who thought about investing time improving its service. For years, too, it barely addressed the rampant abuse that people—and women in particular—face on the service. This sowed fear and frustration for many of its power users, who could face threats or cat-calls sometimes just for tweeting about movies or video games. (It does not help that seven of Twitter’s eight board members are men.)

The company also failed to capitalize on the boom in messaging services. Despite serving as the web-facing identity for many Internet power users, it never appeared to prioritize its buggy messaging service, which would sometimes tweet text that was supposed to be a private correspondence. It shipped small improvements—like letting users send photos to each other—but never broke out its DM service into a separate app, as Facebook has done. Meanwhile, WhatsApp and Snapchat’s user bases swelled.

The more irredeemable loss might be in how the service is perceived. In 2010, Twitter was ascendant, an insurgent peer to Facebook—if anything, it was the kinder, friendlier, more open public square to Zuckerberg’s castle. Its format was hailed as revolutionary, and it was credited with fomenting revolutions. Now Twitter usernames and hashtags are ubiquitous, appearing on the sides of billboards, before every major sports broadcast, in street art, on church pamphlets—even on Facebook. The @-symbol before a username, first seen on Twitter, is the global standard for setting off a username in text.

Yet despite this ubiquity, people are no longer flocking to the service. More than one billion people have signed up for Twitter accounts and never returned. The company has become something of an also-ran, now in an entirely different class of companies than the Facebooks and Googles to which it is often compared.

Twitter has, however, been widely embraced by two industries: journalists and marketers. Journalists have made it integral to the news cycle, the place to go for first-person sources and photos of any event. Marketers like it because it is a simple, cheap way to reach a mass audience anytime, anywhere. Neither of these two groups, though, create the sort of user who keeps people actually coming back: someone’s friends. If Twitter can be saved, its new, permanent CEO will have to make the social network more of exactly that. She will have to create a more stable, less antagonistic social space where people might find old friends and make new ones.

Or maybe Jack Dorsey will just take over. His first term went so well.