Peter Chernin and Pivoting Are Good for Twitter

NEW YORK (TheStreet) -- Dalton Caldwell is the CEO of App.net, which aims to be a competitor to Twitter. It raised $500,000 over the summer, via crowd-sourcing on Kickstarter. It doesn't make money from selling ads. It is trying to be less commercially driven than Twitter and, therefore, more appealing to more users.

Two weeks ago, Caldwell wrote a blog post on his own Web site that criticized Twitter for appointing former Fox COO Peter Chernin as a director.

Caldwell's critiques of Chernin (he called them "interesting things") include:
  • Chernin sent his first tweet ever after his board appointment
  • He didn't add a "." at the beginning of his first tweet
  • Chernin called himself a "long-time users of Twitter"

    This is all for Caldwell to conclude that Chernin is a luddite. He also used a 2006 quotation from Chernin that I believe was meant to show Chernin was a.) responsible for buying and then destroying MySpace and b.) doesn't really get Web companies.

    Caldwell then proceeds to explain that this move is the sign of a "pivot" for Twitter away from the old Twitter its initial users knew to one that is aiming to get mainstream people to use.

    The "post-pivot Twitter" is supposed to be focused on:
  • Consuming news and information instead of sending tweets
  • Being media-friendly
  • Ignoring tweets and replies from "normal users" which is to say the pre-mainstream Twitter users
  • "The Discover tab is the future"
  • Cutting off developers who used to build on top of Twitter APIs

    I don't know Peter Chernin, but I heard him speak a year ago at a tech conference and came away very impressed. Despite being out of Fox for a few years now, he's been very active in tech investing and has had his name mentioned a couple of times for a top tech CEO job.

    In his comments at the conference, which lasted about 30 minutes in an informal Q&A, it was clear he had a strong grasp of media, tech, as well as the growing influence of Asia on both types of companies.

    If I worked at Twitter or was an investor, I'd be very excited about Chernin joining the board. So what if he hasn't tweeted before? Would he be a better director if he'd sent 80,000 tweets already? I don't know. All I know is that, if I was Dick Costolo, I would have jumped at the chance to get him on my board.

    Twitter is growing and it's changing as it grows. It's making money. It's embracing advertisers. And it's thinking of how to make its service more appealing to more users.

    All those things are fine by me as a user.

    Do I get a better service as Twitter grows?

    Well, yes. I don't get fail-whales any more -- or rarely. And I get a richer experience with more users in just as fast a way as I expect.

    I get to watch and participate in real-time events like a World Series game, or Academy Awards, or Megyn Kelly walking to the "decision room" on Fox News on election night to clear-up the mechanics of how they made their call.

    I can't get any of those experiences on Facebook ( FB) or App.net or anything else.

    What have I lost as Twitter has evolved in the last six years? I can't really think of anything.

    There are ads in my stream now which weren't there before. But I kind of skip over most of them. I don't get annoyed at them the way I do with Facebook's approach.

    Have I lost the authenticity of Twitter? Its soul? I don't really know what that means frankly. It's a great communications medium for me and a great way for me to consume news and information, instead of, say, reading a newspaper.

    I used to use the old TweetDeck for reading and posting. It worked great. Then Twitter bought it and it languished. Finally, they've improved it although it's not as good as it used to be.

    Isn't this a sign that Twitter's given the bird to the developer community though? They bought this two-person company in the UK for $20 million, I think. Then they didn't do much with it for a while. I doubt the two Brits feel grievously harmed.

    Did I ever think of dumping Twitter because it forced me to use their own client instead of some third-party one? It never crossed my mind. Where exactly would I go as an alternative?

    Won't there be more media companies using Twitter in the future? And won't they over-commercialize the service?

    When it happens, I'll be the first to blow the alarm. But I just don't see it. Up until now, any media joining Twitter or promoting a hashtag on a commercial has only made the service better, not worse.

    I'll give Costolo and his management team the benefit of the doubt on this one -- and keep tweeting.

    At the time of publication, the author had no positions in any of the companies mentioned.

    This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

    Eric Jackson is founder and Managing Member of Ironfire Capital and the general partner and investment manager of Ironfire Capital US Fund LP and Ironfire Capital International Fund, Ltd. In January 2007, Jackson started the world's first Internet-based campaign to increase shareholder value at Yahoo!, leading to a change in CEOs in 2007. He also spoke out in favor of Yahoo!'s accepting Microsoft's buyout offer in 2008. Global Proxy Watch named Jackson as one of its 10 "Stars" who positively influenced international corporate governance and shareowner value in 2007.

    Prior to founding Ironfire Capital, Jackson was President and CEO of Jackson Leadership Systems, Inc., a leadership, strategy, and governance consulting firm. He completed his Ph.D. in the Management Department at the Columbia University Graduate School of Business in New York, with a specialization in Strategic Management and Corporate Governance, and holds a B.A. from McGill University.

    He was previously Vice President of Strategy and Business Development at VoiceGenie Technologies, a software firm now owned by Alcatel-Lucent. In 2004, Jackson founded the Young Patrons' Circle at the Royal Ontario Museum in Toronto, which is now the second-largest social and philanthropic group of its kind in North America, raising $500,000 annually for the museum. You can follow Jackson on Twitter at www.twitter.com/ericjackson or @ericjackson.

    You can contact Eric by emailing him at eric.jackson@thestreet.com.

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