3 ms·

Why is the sockpuppet problem good for Twitter’s stock price?

• chatmasta 8y ago
  Well, since you asked, here's some "throwaway math" for you. ;) a) Although Twitter tries to estimate the number of "bot accounts" in its QE reports, it has no accountability in calculating the percentages. Therefore they can use it as a tool to manipulate DAU. If real DAU goes down, just change the bot numbers to make it look like DAU is up. b) Sockpuppets generate activity from real humans. The whole point is that they push agendas, sow discord, etc. Sockpuppets wouldn't work without victims interacting with them. Therefore more sockpuppets = more human activity = more ad revenue & higher metrics for stock price c) My speculation is that the sockpuppet problem is extremely understated, and an accurate estimate would amount to a higher percentage of Twitter's reported userbase than previously admitted. Therefore, accurately reporting the percentage would require Twitter to negatively adjust their real user numbers, which drive the stock price. The central problem is that for every 1% of users Twitter defines as sockpuppets, it must lose 1% of "real" users. Therefore once twitter makes a single estimate of bot percentages (which they have done), increasing that percentage is dangerous for their stock price because it means decreasing the percentage of real users, a key metric in the stock price.