Twitter jumped the shark, now it looks like MySpace

Elon Musk has good reason to laugh at those naysayers who predicted that if he laid off half his workforce, Twitter would collapse. Without engineers to keep it running, critics said, the platform would collapse. Two months later, the social media site is still alive and may have even grown.
However, his demise is still possible. Not because it lacks the talent to find bugs or keep the servers running, but because maybe its time has come. Recent gimmicks include restoring suspended accounts, introducing blue ticks for everyone, and pseudo-democratic political decisions. At first glance, none of this alone heralds an impending doom, just the whims of a billionaire showing off his new plaything.

But history can show this as the moment musk jumped the shark. This term comes from the 1970s American sitcom Happy Days, which starred Henry Winkler as Fonzie in a leather jacket and Ron Howard as Richie Cunningham with freckles. The series was one of the top shows on US television at the time. In season five, however, the writers were desperate for new ideas, so they had The Fonz water-ski jump over a shark. Although this episode was a ratings success, it showed how absurd the producers had gone to get attention.

The show went on for another six seasons, but audiences began to lose interest and ratings plummeted dramatically. Shark jumping didn’t kill Happy Days, but it did signal a peak in relevance and popularity.

Thirty years later, a similar desperation was on the faces and checkbooks of News Corp executives. to see. Eager to break into the hot new arena of Internet social media, Rupert Murdoch’s multinational conglomerate spent $580 million to acquire MySpace in July 2005.

At the time, MySpace had 16 million users, making it the fifth most visited website in the United States and the world’s leading social networking platform. Murdoch saw it as an opportunity to direct users to his other sites, including Fox-branded news, sports and movie sites. (Disclosure: Two years later, News Corp. bought Dow Jones and The Wall Street Journal, which compete with Bloomberg in the financial news and information market).

Beyond millions of users, the purchase gave Murdoch’s team what they desperately craved: chic. Rather than buying printed newspapers or tuning in to cable news programs, teens of this era were spending more time on a computer, writing their own content and sharing updates with friends. His humble roots in Adelaide, Australia, coupled with decades in London’s grueling newspaper market, had made Murdoch rich and powerful, but it didn’t make him cool. To do this, he turned to Los Angeles-based Web Wizards.

Though MySpace continued to grow, reaching 100 million users worldwide a year later, it lost its novelty to a hip new Harvard dorm startup. In 2008, Facebook overtook MySpace for web traffic.

Musk could learn a lot from Murdoch’s mistakes, but likely won’t.

Eager to monetize MySpace and meet its publicly announced goal of $1 billion in advertising revenue by 2008, News Corp. to forcefully serve ads to users of the website. Tensions escalated between the site’s founders and the team Murdoch had hired to run it. Innovations aimed at making it more user-friendly, such as Improvements such as reducing the number of pages to load were thwarted by the new owner’s desire to squeeze every penny out of the deal. It wasn’t long before it became apparent that those who knew MySpace inside out were being usurped by outsiders who were buying it and wanting to assert their right to run it as they pleased.

Users were spending less and less time on MySpace and more on Facebook. Years later, Murdoch himself would recognize this as the beginning of the end.

Musk’s predicament is not dissimilar.

After spending $47 billion, not all his own money, the Tesla Inc. and SpaceX chief executive funded the deal with $13 billion in debt that requires around $1.5 billion in annual interest payments. In comparison, Twitter reported 2021 sales of $5 billion with a net loss of $221 million and negative free cash flow of $379 million. The second richest man in the world has no choice but to quickly cash in on his newfound fortune unless he has to pay those debts out of his own pocket.

But Twitter’s challenges and decline may have begun before Musk even made his half-hearted offer in April. According to market researcher GWI, the site lags behind rivals Facebook, Instagram, YouTube, WhatsApp and TikTok by a wide margin. Only 3.5 percent of global users cite it as their favorite social media platform.

Additionally, over 75 percent of Twitter users are regulars on major competitor platforms, but the same cannot be said the other way around — only 54 percent of Instagram and 56 percent of TikTok users are also active on Twitter. If push comes to shove, those in the Blue Bird app have plenty of other places to land. Additionally, according to data from HootSuite and We Are Social, it lags behind YouTube’s 23.4 hours and TikTok’s 22.9 hours globally, averaging just 5.5 hours per month.

But perhaps the biggest concern is the one that Murdoch himself flagged.

While Musk’s attention-grabbing acquisition has undoubtedly attracted some new fans and increased engagement, that may be fleeting. In fact, the average time spent on Twitter fell 15 percent in the third quarter of 2021 and 6 percent in the last three months of this year, just before its acquisition drew larger crowds, according to data compiled by Bloomberg Intelligence.

When this downtrend returns, as marketers and researchers are predicting, Twitter will already have peaked. There can be times when stunts and one off events pull people back. But it’s only so often that a teenage activist can train a bald musclehead or the website owner can conduct a gimmicky opinion poll.

The rest of the time, Twitter has a good chance of slowly slipping into obscurity, like a guy in a leather jacket jumping at a shark.

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