Recent back-to-back ordeals faced by Twitter following its acquisition by Elon Musk have proven to be a lesson for customers as well as big tech and heads of social media platforms.
Initially, the new owner decided to charge $8 per month to retain the blue tick i.e the verification icon on the handles. This sparked a debate on whether or not it will compromise the credibility and legitimacy of prominent personalities.
This also proved chaotic for a lot of companies who saw their share prices slide when bogus accounts began posting phony tweets after modifying its name.
One prominent incident is that of pharmaceutical giant Eli Lilly and Co. A fake account carrying the blue tick that was named after the company tweeted that the pharma giant has now decided to offer free insulin. When the tweet proved to be fake, the company’s share went into free fall and it lost millions in its market cap.
Musk says Twitter to hold off relaunching blue check verification
This was not an isolated incident because Pepsi, Lockheed Martin, BP Global and Nestle also witnessed similar impersonations that affected their image in the market and impacted stock prices. This led Twitter to add an official logo to genuine accounts. Now, genuine accounts carry a blue tick and an official logo.
In truth, Musk’s experiment proved to be chaotic for companies. This also served as a lesson for customers and the rest of social media networks to not monetise verification at this point in time. This will only lead to a proliferation in fake news.
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Following closely after came the layoffs at Twitter.
Nearly two-thirds of the employees working for the platform were fired and many departments were shut down. Musk argued that “there seem to be 10 people “managing” for every one person coding.”
The move was aimed at revamping the platform but caused massive problems. Reportedly, the copyright feature of the platform has been disabled which is enabling the users to post copyrighted material freely and without any fear of accountability.
This also sparked a wave of protest by Twitter users who demanded a shift to an alternate platform. Despite this, Musk tweeted that the platform added 1.6 million daily active users this past week, another all-time high.
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Currently, the social media ecosystem is seemingly at its lowest point since inception. All platforms are struggling to attract users and hitting deadends.
Facebook, Instagram, TikTok, Twitter and Snapchat are desperately trying to introduce a unique selling point but so far, no strategy has worked. This is partly due to the success of WhatsApp as a super app that allowed seamless networking but on the other hand, it is proving disastrous for social media applications.
At present, all social media sites are in trial and error mode for introducing something new and gaining market share but there has been slim progress on it. Meta’s plan to create a Metaverse is also suffering because the number of users is far below what chairman Mark Zuckerberg expected.
This situation calls for a total revamp of social media ecosystem or the launch of a new application that can rival or completely eliminate all the present ones. Such a scenario was witnessed in 2007 when Facebook gained popularity as it spelled doom for then-famous social media giant Orkut.
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Then came the tech winter
While Twitter layoffs caused a hue and cry, it was not an isolated incident. Most tech giants and big tech in particular have laid off employees or frozen hiring.
The infamous FAANG companies i.e Meta (formerly Facebook), Amazon, Apple, Netflix and Alphabet are also facing hardships in their operations. Meta, Amazon and Netflix have already laid off a big chunk of their workforce while Alphabet Inc. is expected to sack nearly 10,000 workers. On the other hand, Apple frozen hiring a few months ago. By the numbers, Meta laid off 11,000 employees, Amazon sacked 10,000 workers and Netflix earlier fired 450 people.
Meta to cut more than 11,000 jobs in one of the biggest layoffs this year
In addition, Snap, the company behind Snapchat, has also cut its workforce by 20%. Cumulatively, tech giants (including social media, fintech and ride-hailing firms) have laid off over 120,000 people this year and this number is expected to spike further. To gauge the scale of the disaster in making, the dotcom bubble in 2000-01 resulted in 107,000 layoffs. The current hit to tech firms is proving to be far larger than dotcom bubble, which is a historic event for digital-first firms.
In a ripple effect, these actions is adding unemployed workers or job seekers to countries reeling from the damage caused by Covid-19 since 2020.
When Twitter laid of 5,000 people in India, these highly skilled people were added to the workforce amid limited job openings.
The condition is worse for immigrant workers in foreign countries. The US-based workers hailing from foreign lands are dropping online requests to employers to hire them in a bid to extend the H1-B visa. Failure to secure a job in the given time-frame will leave them with no option but to move back to their home countries. It is pertinent to mention that many of them have settled down in foreign lands and started families that have foreign nationalities. At such a time, these tech layoffs will spark multi-faceted problems for such workers.
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It also gives a lesson that even highly skilled workers are being laid off and therefore, the level of job security in tech ecosystem is slim to none.
There is a dire need to revise regulations implemented on the technology eco-system of the world in a bid to safeguard companies as well as workers.
The article does not necessarily reflect the opinion of Business Recorder or its owners
The writer is a Senior Sub Editor at Business Recorder (Digital)
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