Tumult at Twitter shines a light on a deflating tech bubble
Photo: Philipp Katzenberger
Elon Musk’s takeover of Twitter has had a rocky start. A lack of a clear corporate and product strategy has alienated advertisers and users alike. Twitter’s brush with profitability is now being replaced by serious concerns over the platform’s long-term future direction.
The culture on the platform is one of grim humour, with users describing it as being part of the ‘last episode of Friends’. Other users are making the most of it in activist ways as well. A ‘parody’ misinformation stunt using Twitter’s $8 verification feature cost Eli Lilly, a leading provider of medical insulin in the US, billions of dollars in stock value.
In short, the rapid-fire decisions are not without implications. It is not beyond probability that, given the serious market implications of what happens on a single ‘social’ platform in a day, regulation will be forced to follow – and soon.
And Twitter is not the only corner of the internet experiencing difficulties. Meta has promised to cut 13% of its workforce. Stripe, the company behind most online payment processes, is set to cut staff by nearly 14%, and Lyft, another high-value ‘big tech’ company, is set to cut staff by 13%.
Hiring freezes at other big tech companies are further muddying the waters. On the one hand, a probable recession is looming. However, the Covid-19 pandemic did not have nearly as strong an impact on these same companies. Indeed, the 2008 crash was the birthplace of many of them.
What we are looking at is the beginnings of a renaissance, initiated by a crash. New companies will benefit from the stagnation of the older ones. But tech as a whole has reached an endpoint of its golden era of over-valuation. Tech is no longer mysterious or forward-thinking; it is simply a normal part of daily life, which any teenager can learn to code in a few weeks on YouTube or GitHub. The world is poised for serious change over the next year-plus. The tech world is no different.