Twitter’s Handheld Calamity
According to academics at NYU Stern, launching a new product is the single best business move that a CEO can make to lift a share price. Far better than mergers and acquisitions, cost-cutting, or shaving tax-rates by one percent, the university estimates that $1 million spent birthing a new market creates $1.75-2 million in average shareholder value. Yes, please!
Of course, step outside the classroom, and investors will surely encounter many not so average misfits, oddballs, and outliers. Windows 7 transformed an industry and defined Microsoft for years, as have numerous box office sagas for Disney by Disney. But innovation is hard. Here’s one unfortunate stinker that investors would rather forget!
Ever heard of the TwitterPeek? Eleven years ago, when first-gen smartphones were hot, social giant Twitter decided that a handheld device – only for tweeting – was what consumers needed in their lives!
Looking like a school calculator and costing a hundred-dollars upfront plus ten a month thereon, tech journo David Progue must have been hearing things went he said the Peek was winning “quiet, gradual acceptance among normal people.” Sales barely got off the ground with normal people, and Twitter pulled the plug on it in 2012 so that the company could IPO (initially publically offer) with a straight face.
The whole thing is best put down as a massive strategic miscalculation, but it’s also an ode to innovation. Apple didn’t get the iPhone right first time. Only a daring culture of invention and experimentation can spawn great stock market riches – so don’t knock it!