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Twitter hack raises questions about Jack Dorsey's role at company

The massive security breach comes at a challenging time for the social network's co-founder.

Richard Nieva Former senior reporter
Richard Nieva was a senior reporter for CNET News, focusing on Google and Yahoo. He previously worked for PandoDaily and Fortune Magazine, and his writing has appeared in The New York Times, on CNNMoney.com and on CJR.org.
Richard Nieva
3 min read
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Twitter CEO Jack Dorsey 

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Twitter CEO Jack Dorsey was silent as his company's service descended into bedlam on Wednesday. As critics, commentators and journalists called on Dorsey to do something, hackers romped over the accounts of prominent Americans -- including Elon Musk, Barack Obama and Joe Biden -- and tweeted out blatant cryptocurrency scams. The corporate accounts of major companies -- Apple and Uber -- tweeted similar messages. When Twitter got control of an affected account, it didn't take long for the attackers to wrestle it back.

The company finally settled the situation after resorting to extreme measures: disabling a large chunk of the service. Dorsey's first comments came four hours after the attack started, a jarring gap for the lightning-fast pace of information consumption he helped to create.

"Tough day for us at Twitter," Dorsey tweeted. "We all feel terrible this happened."

It's never a good time to have what could be the worst day in your company's history. But for Dorsey, who's generated a cult of personality in Silicon Valley, Twitter's clumsy response comes at a particularly challenging moment. Both Twitter's role in shaping public discourse and Dorsey's handle on the company are being questioned.

With the US presidential election looming, the integrity and security of social media platforms is already under the glare of an intense spotlight. Dorsey has invited more scrutiny of Twitter by stepping out on a political limb, taking a hard stance on President Donald Trump's tweets and flagging some for misleading information and inciting violence. The move set Twitter apart from Facebook, which left Trump's posts alone. (Facebook has since reconsidered its policies). It saw Dorsey being lionized by progressives and demonized by conservatives.

Inside Twitter, Dorsey has faced a flurry of palace intrigue. Earlier this year, Elliott Management, an activist fund with a sizable stake in Twitter, called for Dorsey to focus his attention on Twitter or leave. The firm's demands included Dorsey stepping down as CEO or relinquishing the same title at Square, the payments company he helped found. In March, Elliott stood down on trying to get rid of Dorsey, but it still has a presence on the board and is known for biding its time.

Eliott Management declined to comment on the hack. Twitter declined to comment on Dorsey's leadership and wouldn't make him available for an interview. Twitter has said the attack may have been the result of hackers going after Twitter employees who had access to internal tools. Around 130 accounts may have been targeted. The FBI is reportedly investigating the incident. 

The hack, however, could fuel the drive to force Dorsey to focus his attention.

"His position has always been a little precarious. It is very hard to retain being CEO of two organizations," said David Yoffie, a professor of business administration at the Harvard Business School. "This incident is probably more damaging to his personal reputation because of his split focus."

Dorsey has defended his double duty at Twitter and Square in the past. "I have enough flexibility in my schedule to focus on the most important things, and I have a good sense of what is critical on both companies," he said at a Morgan Stanley event in March.

Even though Dorsey seems to have the support of his board, a high-profile disaster like Wednesday's breach could cause the company's directors to at least consider changes, said Christine Mooney, a professor at the Northern Illinois University College of Business. 

"It's something the board will have to assess," Mooney said. "Could this have been prevented if he only dedicated his time to this one major company?"

There's one bright spot for Dorsey. Later this month, the CEOs of Facebook, Google, Apple and Amazon are expected to testify before a House Judiciary subcommittee on antitrust. Twitter, which doesn't face the same antitrust criticism as the other companies, isn't attending. While the subject of the congressional grilling is market competition, the politicians will undoubtedly veer into other topics, such as election integrity, political bias and platform security.

After the hack, Dorsey is likely especially thankful he won't be joining his Big Tech counterparts in the hot seat. He took his turn at a pair of hearings two years ago, and it isn't out of the question for him to face congressional scrutiny for Wednesday's hack sometime in the future.  

"If you were in his shoes," Harvard's Yoffie said, "you would probably be delighted to not be on the list."

Watch this: Major Twitter accounts hacked in Bitcoin scam, Verizon told to pull some 5G ads