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Noah Mallin Headshot

The Premature Death of Twitter

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TWITTER
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The knives are out. As Twitter struggles to grow their user base, a chorus of grumbles has risen from Wall Street to Silicon Valley heralding the end of the social network. The Atlantic even offered up a eulogy. The crowning insult was a shot by NBC's Research head Alan Wurtzel at last week's NewFronts at the one place where Twitter has shown strong growth -- ad revenue. Revenue driven increasingly by a savvy "second screen" strategy linking their social platform with TV networks and advertisers. It's no surprise then that when Wurtzel dismissed Twitter's ability to impact TV viewership the drumbeats would reach a crescendo. So is Twitter really the next Friendster?

Perhaps you remember Cuil? That was one of a long-line of so-called "Google killers" that emerged around 2008 like Microsoft's Bing, Wolfram Alpha, Kosmix and many others that were supposedly going to upend the search landscape. Some tech analysts even claimed the launch of Facebook's search tool would take down or at least dent the dominant search engine but it never happened. Conversely, Google's Google + has hardly been more successful than companies like Path at upending Facebook's social dominance. In fact the social landscape has seemed simply to expand to include newcomers like Pinterest and Instagram.

In every case these platforms tapped into an initially enthusiastic cheering gallery in the industry who were eager to take down dominant players like Google and Facebook. They were and are still empires, and empires inspire dreams of overthrow and upheaval.

Twitter, on its face, does not seem very empire-like. It's big, but not massive like Facebook and the slowing of user growth is undeniable and genuinely troubling. When it comes to social networking Facebook is the clear colossus.

Yet Twitter has built a unique empire, one that Facebook and others have been attempting to chip away at with little success: Twitter absolutely dominates real-time information sharing and networking.

An obvious tipoff of Twitter's dominance in real-time has been the slew of "Twitter killing" Facebook enhancements such as hashtags, trending topics, and their just-announced program to work with TV networks on data display.

That's why, beyond the issues with platform growth, the NBC comments were the most dangerous development over the last week for Twitter. What has cemented the relationship with TV networks and in turn supercharged the platform's revenue growth is the real-time nature of Twitter usage, and the tools Twitter built specifically to tie that into real-time TV viewership and the accompanying advertising spend.

However, the premise of NBC's observation is flawed on several levels. The meat of the complaint is that there was no noticeable increase in Olympics television viewership that was attributable to Twitter. Fair enough. But why would there be? The Olympics are one of TV's top rated events -- for any online platform to move the viewership needle in a measurable way is questionable.

The Twitter benefit to TV (unlike the TV benefit to Twitter) is not primarily driving viewership. The true benefit is the ability to extend the reach of advertisers amongst highly engaged users who are on Twitter as a second screen. Reinforcing broadcast ad messaging with targeted Twitter messaging has a great deal of potential to take a one-way message and expand it into participatory marketing.

Another huge boon to TV networks is the ability to dig deeper into who their superfans are, and to turn that data into proof points to bring in advertisers. Rather than relying on analog demographic metrics that come from panel data, networks could show advertisers that in addition to having viewers that are young, female and affluent they might, for instance, take more vacations than most people or are more interested in luxury vehicles. Twitter's open nature makes this data relatively easy to harvest versus Facebook, where there are typically more privacy restrictions.

As to user growth, it may be that Twitter will never approach Facebook's size and scale. The interest in real-time interaction around topics simply might not extend to as big a population as exists for connecting with friends and acquaintances (Facebook) or even sharing images and videos of what you are doing at any given moment with a friend network (Instagram.)

Still, Twitter is sizable and the users who love it really, really love it. It's unlikely to wither on the vine or disappear, provided Twitter itself doesn't get lured by Wall Street's siren call into making major changes that alter the essential real-time information sharing ecosystem it dominates.

 
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