Following what can only be described as a dismal 2015 in which Twitter shareholders endured a 38% drop in share price, it's clear new-ish CEO Jack Dorsey and team have a lot of work ahead of them this year. The concerns are nothing new: sluggish monthly average user (MAU) growth and a lack of engagement, both of which have overshadowed Twitter's revenue improvements.
Continue Reading Below
Dorsey and Twitter aren't letting the ongoing MAU problems prevent it from pushing the technology envelope. The question is: why?
Image courtesy of Flickr
You're kidding, right?There are no shortage of companies testing the unmanned aerial vehicle (UAV) waters, including Twitter's nemesis Facebook . It could be argued that much of the pressure Twitter stock has been under of late is due to unfavorable comparisons with the social media king.
Despite its massive size -- nearly half the world's Internet connected masses are among Facebook's 1.55 billion MAUs -- it continues to grow by leaps and bounds each quarter, even as Twitter's MAU growth of a paltry 3 million in Q3 once again disappointed. Facebook's plan for its own unmanned, solar powered drones (UAVs) is to beam Internet access to underserved markets via its Free Basics initiative (formerly known as Internet.org), presumably boosting its MAU growth even further.
Turns out, Twitter may pursue its own drone plans after applying for a patent to build a tweet-controlled UAV equipped with video and picture taking capabilities, all delivered via a user's Twitter account. When asked to comment on the patent app, a Twitter spokesperson actually said, "Two words: drone selfies." Applying for a patent doesn't mean Twitter is actively developing a drone -- for selfies are anything else -- but the notion it's even considering such an endeavor is a bit disturbing, for a few reasons.
An uphill battleAs of a couple of weeks ago, the Federal Aviation Administration (FAA) now requires drones to be officially registered in the U.S. by Feb. 19. The reasons are two-fold: As the proliferation of personally owned UAVs grows, there are safety concerns as the sky above us becomes increasingly crowded. Already, there have been instances of drones causing problems with commercial aircraft.
The other issue surrounding drones involves privacy, or lack thereof, that some consumer's believe video monitoring UAVs infringe upon. In fact, there have been several instances of folks shooting drones out of the sky. Grabbing a shot gun when a UAV buzzes by may seem a bit extreme, but it's indicative of the growing privacy issues that have arisen given the monitoring of consumer's Internet and mobile usage, among other concerns.
Thanks, but no thanks For Twitter, safety and privacy aren't the biggest problems with its possible entry into the world of UAVs. The larger issue is what exactly would a drone designed to view events and take selfies do to address Twitter's biggest problems -- lackluster MAU growth and poor engagement levels? The answer is, absolutely nothing.
Sure, Twitter fans may suggest that the new tool would add to the user experience, thereby increasing the chances that more MAUs would come knocking, and existing tweeters would stick around longer. Not likely. If anything, Twitter should follow Facebook's lead -- again -- and explore drones as not only a philanthropic effort, but ultimately increasing its MAUs by connecting potential MAUs in emerging markets.
Moonshots are great, assuming the timing is right. Facebook delving into virtual reality (VR) and drones made sense given both provide new avenues for growth, and just as importantly it's in the financial position to do so. Twitter, on the other hand, has bigger issues to address -- when Dorsey isn't wearing his Square CEO hat, that is.
The article Forget The Moonshots Twitter Inc, Get Back To The Basics originally appeared on Fool.com.
Tim Brugger has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Facebook and Twitter. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright 1995 - 2016 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.