Wednesday, September 15, 2010

This Was News?

OK, I get it; Twitter's all the rage and everything they do or even think about doing gets covered with microscopic detail. However, I was a bit surprised when the whole tech news world basically stopped for a second while Twitter unveiled details that many think will pave the way to an ad-supported business model.

As most anyone who follows tech knows, how Twitter's going to make money has been one of the biggest reasons the platform has stayed in the press -- at least if you don't count Kanye West's most recent apology to Taylor Swift. We've all been waiting for many months, especially after the announcement of several new high-level executives, to see what kind of innovative platform for making money the firm was going to unveil.

This week we got our strongest hints when Twitter unveiled some changes designed to basically keep people on for much longer periods. Most know think they're leaning toward an ad-supported business model -- which leads me to my next big question. "Haven't we been there before?"

It seems Twitter thinks that it will be able to finance itself with ads despite the fact that the increasing glut of inventory has pushed down ad prices significantly. Bottom line: Advertising brings in less money all the time because there are more places to display ads and because reading patterns are becoming much more fragmented.

To be fair, Twitter did unveil several new features on its site, including the ability to include multimedia content, that many see as a move Twitter is making to directly position itself as a Facebook competitor. One big difference I see, however, is Facebook is designed as more of a "walled" garden where you can control who sees the content you distribute. In contrast, Twitter's more of a broadcast platform designed to get your message out to as many as possible. This is illustrated not only in the ability to send messages to followers, but by the fact that retweets are often the primary reason that someone's message gets wide enough distribution for mass attention.

Niall Harbison of The Next Web penned a laudatory piece on the announcement, saying that what at first appears like a Web site upgrade will emerge as something much more meaningful given the role that Twitter now plays in our every day lives.

Time will tell on that prediction, but it seems to me it's going to take more than another ad model for Twitter to reach its full potential.

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