Twitter’s TWTR hit a rough patch recently after it came to the forefront that terrorist groups are still being able to hack into accounts and use them for hate propaganda.
Per Reuters, between January and June last year, Twitter had reportedly suspended 205,156 accounts, which violated its policy prohibiting the promotion of terrorism. However, the breach is stemming from a 10-year-old vulnerability, and management notes that it is difficult to manage the issue.
Brief Glance at the Issue
Before last summer, Twitter did not require a user to verify a linked email address, which means that there are numerous accounts with expired or unverified email addresses. This is the window through which terrorists are still hacking into the platform by creating the expired email address and linking it back to the twitter account.
Reportedly, TechCrunch had been notified of a number of hijacked accounts by security researcher WauchulaGhost. The Islamic State had used these accounts to spread messages and videos supporting violence. Even though many of these accounts were since deleted, the vulnerability still persists.
Rising Security Issues
This news came just days after the news of demonstrative hacking by British firm Insinia highlighted certain flaws in Twitter’s account security system.
Twitter was also in the national glare with reports of a possible antitrust probe last year. The company was among a number of tech giants like Alphabet’s GOOGL Google, Facebook FB and Amazon AMZN that are likely to face antitrust probe by the U.S. government.
The White House had reportedly issued a draft executive order last September, instructing a thorough investigation on the conduct of social media and internet companies, by federal antitrust and law enforcement officials.
Facebook’s Cambridge Analytica scandal in March, in particular, had an impact on all media stocks. Twitter had reportedly sold data access to millions of Facebook users.
How These Flaks are Affecting Twitter
Rising security breach concerns combined with Twitter’s internal issues are taking a toll on the company’s user base.
In third-quarter 2018, Twitter’s adjusted monthly average users (MAUs) totaled 326 million compared with 330 million in the year-ago quarter.
However, Twitter reported that “spammy and suspicious accounts” accounted for less than 5% of MAU in the last reported quarter. On the back of concerted “health efforts” to minimize suspicious new accounts, the company witnessed a quarter-over-quarter decline of 20% in successful sign-ups.
Twitter Pulling Up Socks on Platform Security
However, Twitter spent the year taking steps to improve security on its platform. The company not only improved the sign-up process but also audited existing accounts for signs of automated sign-up.
The company “identified and challenged more than 9.9 million potentially spammy or automated accounts per week” in May 2018, which is a substantial increase from December and September 2017, in which it challenged 6.4 and 3.2 million accounts, respectively.
Notably, the number of spam-related reports it gets from users has declined on average. Distribution of trade secrets and private information will also be under the purview of Twitter officials.
We believe the company’s recent efforts will help it build trust and repair brand image, thereby improving user engagement.
Twitter currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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