All Tech Considered
4:15 pm
Wed April 30, 2014

Twitter CEO Hopes To Attract Users By Clearing The Clutter

Originally published on Fri May 2, 2014 1:48 pm

Twitter is growing and its brand is spreading but Wall Street is unimpressed. On Tuesday, the company announced it had doubled its quarterly revenue from a year ago to $250 million. The social networking site also increased its number of active users to 255 million, up 25 percent from a year earlier.

But despite the gains, Wall Street analysts have called the growth tepid. Twitter went public last November, and its shares have traded as high as $74; on Wednesday, it opened at under $38.

CEO Dick Costolo tells NPR's Robert Siegel that the company isn't focused on getting a certain amount of users.

"I think the way we've articulated our thinking about the future of our user growth efforts, [it's] very much in the context of bridging this gap between what seems to be the global awareness and almost ubiquitous presence in the culture about Twitter and migrating that awareness of Twitter into engagement on the platform," Costolo says.

And while Facebook has continued to do well, Costolo says he doesn't see that company as his competition.

"I think about us at Twitter as being a public, real-time conversation and that has made us this companion experience to whatever else is happening in your world," he says. "We think that the platform itself is so different from why people use Facebook, that I don't think the comparisons in terms of users or anything else is helpful."

So what's holding Twitter back? Things like the @ sign that initially defined the platform may be standing in its way, he says.

You can read more highlights from the conversation below.


Interview Highlights

On the connection between TV and Twitter

When we invested in our Twitter and TV strategy, it was based on data that we saw that very much informed us that there was a two-way complementary relationship between Twitter and TV. Not only did that data tell us that Twitter drives tune-in but that commentary on TV drove engagement and conversation back to Twitter.

On the future of @ and #

Well, the hashtag, for us, is absolutely here to stay. People understand it globally. I was in Shanghai recently where Twitter is blocked and yet there were ads and billboards across town with hashtags on them.

I think the @ sign is some of the scaffolding that I talk about within Twitter that sometimes makes it harder to navigate in specific cases. So let me just give you a simple example: When I'm having a conversation with six or seven people on Twitter ... some of the 140 characters start to be consumed by the six or seven @ usernames in the tweet, that leaves me very little space left in which to navigate. So those are the kinds of things I'm talking about when I publicly say we need to push the scaffolding of Twitter to the background and bring the content forward and allow people to navigate more freely.

On protecting users with private accounts

If you tweet something and you've done so as a private account, first of all, it's certainly not public and broadcast. ... Whenever we have had requests for information from our users that we have deemed to be in violation of our users' rights or believe that those users should have the right to defend their ability to keep that data private, we have gone out of our way in every circumstance — above and beyond — to enable those users to fight those requests in open court. And I think it's fair to say that we've been at the forefront of protecting our users in that respect and we'll continue to do that.

Copyright 2014 NPR. To see more, visit http://www.npr.org/.

Transcript

MELISSA BLOCK, HOST:

From NPR News, this is ALL THINGS CONSIDERED. I'm Melissa Block.

ROBERT SIEGEL, HOST:

And I'm Robert Siegel.

The news from Twitter yesterday, and Wall Street's reaction to it, are hard to summarize in 140 characters. The social networking site announced that it doubled its quarterly revenue from a year ago to a quarter of a billion dollars. Twitter also increased its number of active users to 255 million. That is what is up at Twitter. What's down is the value of its stock. Twitter, which went public last November and reached a share price of $74 in December, opened this morning under 38.

What's going on? Well, we're going to ask Dick Costolo who is Twitter's CEO, and who joins us from the company's offices in San Francisco. Welcome to the program.

DICK COSTOLO: Thanks very much for having me, Robert.

SIEGEL: Explain this to us: Twitter just added 14 million active users in three months. it's an increase of 5.8 percent, it's 25 percent more than a year ago and Wall Street analysts call that growth tepid. How many users will you have to have by, say, next year you at this time to have growth that investors consider robust?

COSTOLO: Well, that's a fair question. I think the way we've articulated our thinking about the future of our user growth efforts are very much in the context of bridging this gap between what seems to be the global awareness, and almost ubiquitous presence in the culture about Twitter - it's on TV everywhere, it's in print everywhere, it's all across the Web - and migrating the awareness of Twitter into engagement on the platform.

And, you know, I've mentioned publicly that I think it will be a combination of changes that we make over the course of the year in service to that kind of growth. And we'll see how that goes for us.

SIEGEL: Are you effectively in a race with Facebook? Are they the benchmark here for what growth is supposed to be in social media?

COSTOLO: Well, I think about us at Twitter as being public, real-time, conversational. And that has made us his companion experience to whatever else is happening in your world. We think that the platform itself is so different from why people use Facebook that I don't think the comparisons, in terms of users and anything else, really, is helpful.

For example, they view engagement on Facebook in terms of time on site. And we view engagement on Twitter as how quick we can deliver utility to the user.

SIEGEL: You've mentioned TV. The head of research for NBC-Universal this week compared social media to the "Emperor's New Clothes." He said during the 18-days of the Sochi Winter Olympics, just - that was his word - 19 percent of Olympic viewers posted about the games on social media. His inference was social media doesn't drive TV viewing. TV viewing drives social media, Twitter included. Is he right about that?

COSTOLO: So when we invested in our Twitter and TV strategy. It was based on data that we saw that there was a two-way complementary relationship between Twitter and TV. Not only did that data tell us that Twitter drives tune-in, but that commentary on TV drove engagement and conversation back to Twitter.

Nielsen's study said specifically that there are three things that are correlated with tune-in and ratings. And that those are: A, the previous season's ratings, B, ad spend for that program, and C, Twitter.

SIEGEL: Do I hear you saying the NBC-Universal research is the outlier here? Is that your response to it?

COSTOLO: I think, yeah. I think I would just say, you know, we have a different perspective about it is maybe the way I would put it. And the interesting thing here is that NBC is actually a fantastic partner of ours, tying Twitter and TV together.

SIEGEL: Twitter has infused new meaning into the at-symbol and the pound sign. And we've heard that Twitter may get rid of them. Will they disappear in the near future?

COSTOLO: Well, the hashtag for us is absolutely here to stay. People understand it globally. I was in Shanghai recently where Twitter is blocked, and yet there were ads and billboards across town with hashtags on them. So I think hashtags are very much here to stay and we will continue to invest in those.

SIEGEL: What about the at-sign? Does it have as good a future, as solid a future as the hashtag?

(LAUGHTER)

COSTOLO: Yeah. I think the at-sign is some of the scaffolding that I talk about within Twitter that sometimes makes it harder to navigate in specific cases. So, let me just give you a simple example. When I'm having a conversation with six or seven people on Twitter, the conversation and my responses start to be - some of the 140 characters start to be consumed by the six or seven at-usernames in the tweet. That leaves me very little space left in which to navigate. So those are the kinds of things I'm talking about when I publicly say we need to push the scaffolding of Twitter to the background, and can bring the content forward and allow people to navigate more freely.

SIEGEL: So, the functionality would remain but we wouldn't see it if...

COSTOLO: I think that what should be the case is I can have a conversation with eight or nine people on Twitter and not feel restricted by my ability to, you know, to converse with them because there are so many of us in the conversation. So generally speaking, the kind of thing you're saying is correct. I just wouldn't interpret that as you won't see it. We'll just push that to the background and bring the content forward.

SIEGEL: It was reported recently that some officials from Twitter met with officials from Turkey. Twitter was blocked there and then unblocked there recently. First, to get unblocked in Turkey, did you have to concede anything to the Turks, say, that some Tweets seen elsewhere would not be seen in Turkey?

COSTOLO: No. Specifically it was the constitutional court in Turkey that ordered the unblocking of the platform that enabled Twitter to be turned back on in Turkey. When we receive valid, appropriate legal requests that go through the appropriate legal processes in countries in which we operate, then we will go ahead and apply our country-withheld content policies to them that enable everyone else around the world to still see them. But we have to abide by the rule of law in the countries in which we operate. So that's what's going on there.

SIEGEL: In this country, if I tweeted from an account that I have blocked to non-subscribers, is what I tweet, what I tweet about and where I tweet it from, private and unavailable to the authorities? Or is it theirs if they ask you for it?

COSTOLO: If you tweet something that you've done and you've done so as a private account it's, first of all, it certainly not public and broadcast. Let me try to just make this is as clear as I possibly can.

Whenever we have had requests for information from our users that we have deemed to be in violation of our users' rights, or believed that those users should have the right to defend their ability to keep that data private, we have gone out of our way in every circumstance, above and beyond, to enable those users to fight those requests in open court. And I think it's fair to say that we've been at the forefront of protecting our users' rights in that respect. And we'll continue to do that.

SIEGEL: Dick Costolo, thanks a lot for talking with us today.

COSTOLO: Yes, thanks for having me, Robert. I appreciated.

SIEGEL: Mr. Costolo is the CEO of Twitter. You can follow him @dickc. You can follow me @RSiegel47 and the program @npratc.

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BLOCK: This is NPR News. Transcript provided by NPR, Copyright NPR.

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