Twitter continues to chase to the wrong destiny.
It’s sitting on one of the most valuable data sources in human history, and yet it continues to think it’s an advertising platform. It continues to chase Facebook for social advertising dollars in a game that Twitter can never win because Facebook knows a lot more about its users.
However, Twitter knows a lot more about the social graph–what’s happening and what people are saying about. And there’s a huge business to be built on top of it that no one is talking about.
Twitter is the live internet.
That’s its greatest value. Anyone who spends more than 30 seconds on Facebook knows that it’s mostly about whining and sharing photos. Twitter, on the other hand, is about news, commentary, instant analysis, and trying to get smarter–or at least look smarter–about current events.
SEE: Why it’s time to give Twitter back to the community (ZDNet)
From the 1980s until the past several years, when people heard about breaking news via word-of-mouth they typically turned to network news such as CNN. Today, they turn to Twitter. A recent Pew Research study found that 62% of US adults now get news from social media, up from 49% in 2012.
While the Pew study found that just as many (technically even more) people use Facebook for news as use Twitter, that’s mostly because Facebook has lot more users.
Where Twitter shines is for breaking news and live events. Unfortunately, the Twitter team has been doing its best to gum up the experience by inserting “While you were away…” tweets–from people you interact with the most–above the live feed.
It’s not that important/popular tweets from your Twitter besties aren’t worth calling out, but mixing them with the main feed tells us that the company doesn’t understand its most important differentiator:
Twitter is the live internet.
The current problem could easily be solved by putting “While you were away…” in its own column. It could replace the useless Moments column and become a valuable lens into your Twitter stream, alongside Notifications. But it would also get out of the way of the live feed, where Twitter’s greatest value lies. Did I mention that Twitter is the live internet?
Knowing what people across the world are seeing, thinking, and saying about events, places, people, governments, companies, and products in real time on a global scale is unlike any other data source in human history.
You can think of Microsoft buying Linkedin for $26.2 billion, as the tech industry waking up and saying to itself, “It’s the data, stupid.” And with that realization, other tech companies are likely to turn to Twitter and see the value that Twitter itself has overlooked. My ZDNet colleague Larry Dignan sees IBM and Google as potential suitors.
But, it’s not too late for Twitter to wake up and change its destiny. If it starts thinking of itself as a data company and not an advertising company, it could own a piece of the future that no other company could touch. No one else has the same level of insight into the “sentiment” of the public at any given moment–and is able to go back to evaluate any slice of time for the past decade.
That’s why companies have been spending millions of dollars on data scientists and software tools to mine Twitter for “sentiment analysis.” This data can help them better understand their customers, know when to enter new markets, predict sales trends, evaluate their competitors, analyze industry trends, and much more.
But, the companies we talk to will often tell us that it’s hard, and it’s a very manual process that involves a lot of mindless data sorting and mastery of open source tools.
Twitter should help them do it, and make that its core business.
In Q1 2016, Twitter made $530 million in revenue from advertising and $63 million from data services (see chart below). The company puts virtually all its resources into developing the advertising business. It’s time to change that and put data at the center of the company.
It should build the world’s best tools and services for analyzing the Twitter stream and turning it into actionable insights. Acquire data analytics companies. Build data visualizations for the public on important topics like elections, public policy, and social issues, as well as charts on fun topics like sporting events, entertainment awards, and trending books and movies–make a place for that on the Twitter homepage. Become a data tiger.
Twitter should also offer services to helps brands optimize their presence on Twitter with tools, best practices, and data. The tools that help brands do this today are not very good and no one should be making more money than Twitter itself on these services–although the company should absolutely let others build on top of the platform.
In fact, Twitter is going to have to jump-start its user growth again, and the best way to do it is to re-open its platform to developers. The company’s slowing growth ultimately dates back to the moment it cut off the API to developers. Let them back in. Let 1,000 different Twitters flourish.
If the company thinks of itself as a data platform and not an advertising platform, it doesn’t need a homogenous user experience. It simply needs as much useful data as possible from every corner of the world. Re-opening the platform would let Twitter be Twitter again, and stop trying to be Facebook.
Twitter has already lost the social advertising war to Facebook. But it can still win the war for the real-time data stream in a way that no other company can.