Twitter CEO Dick Costolo is determined to get the last laugh
The onetime improvisational comedian wants to prove that the social network can make money. — Reporting from San Francisco — Before embarking on a career as a technology entrepreneur, Dick Costolo took part …
Context & Ripple Effects
By January 2011, Twitter is a household name that Pew's Internet & American Life Project measured at just 8% of online Americans using it — famous far beyond its actual user base, and still searching for a business model. The Los Angeles Times profiles CEO Dick Costolo, the former improvisational comedian who took over the top job, framing his mandate as proving the network can make money.
The company's January activity reads like a monetization groundwork sprint: launching Connections, its version of Facebook's mutual-friends feature, to deepen the social graph; poaching a principal scientist from Microsoft's Bing for search; and publicly affirming that freedom of expression is central to its mission, with some Tweets facilitating positive change in repressed countries. Costolo is building engagement and technical depth in parallel with the revenue push.
First-order effects
- Twitter must convert brand ubiquity into advertiser demand against a Pew-measured 8% adoption rate, making engagement products like Connections the immediate lever for growing the addressable audience.
Second-order effects
- Copying Facebook's mutual-friends mechanic signals convergence among social platforms, forcing rivals to compete on overlapping social-graph features rather than distinct formats, while hiring search talent from Bing puts Twitter in direct competition with Microsoft and Google for real-time-relevance expertise.
Third-order effects
- If Costolo's monetization push holds, consumer platforms face the structural test of converting cultural reach into advertising economics before public markets judge them — a template that will shape how venture-backed networks time their path to an IPO.
The trend: Consumer internet companies with outsized cultural footprint but thin revenues are racing to build advertising businesses that justify valuations set by attention rather than earnings.