Thursday, March 19, 2009


Funny how Twitter exploded in recent weeks. Obviously the increased media coverage and popularity is because I finally joined. Of course, I only joined because Bell and the Twitter folks finally hammered out some sort of exclusive backroom deal to let Bell customers SMS their tweets again.

Which is a good thing for Bell - gets the twitter-obssessed on their network. Especially if they get the Pre or some other serious iPhone competitor on the network (or a CDMA iPhone if that ever happens). Gets them more unlimited text pacakages sold too.

So Twitter helps Bell's bottom line. Who paid who here? Since all the Canadian companies shut down SMS to twitter on their end, I'm guessing that Twitter paid Bell. Even better for them. Of course, it's possible Bell paid Twitter and Twitter now blocks Rogers and Telus customers, but that seems remote.

Who else benefits monetarily from Twitter? Individual brands. Writers, musicians, artists, actors, directors, comedians, and anyone else who is technically savvy and has something to sell. There's something very cool about following someone famous. Be it Rob Cordry's often hilarious snippets, Wil Wheaton essentially microblogging, Neil Gaiman mentioning his appearance on Colbert, Stephen Fry updating his trips around the world, Charlie Villanueva talking about how he's got to pick up his game in the second half, Levar Burton inviting any followers in Toronto to meet him for a drink in 40 minutes at Hemingway's (and meeting a couple dozen fans when he showed up), or any number of teenage celebrities typing how much "they luv u so much 4 the suport". Fans by the thousands follow them, and it gives a direct, safe line to sell their stuff.

Gaiman reminds everyone Coraline is back in 3D, Fry's updates are essentially ads for his shows, Burton will get a better turnout for his play, more people will see a movie if they feel the director has "personally" asked them through Twitter. This wouldn't be achieved if a book publisher was posting "Neil Gaiman's new book is out tomorrow, go buy it!" But when Gaiman says "I want my new book to stay #1 this week", it WILL drive people to go pick up that copy they've been putting off. And it's another avenue for Wil to sell his next book, or get people to watch his episode of Numb3rs or what have you.

I'm not saying this is WHY they use Twitter, or that they don't actually enjoy interacting with their fans, but it IS a benefit of the service.

So, at least one corporation is profiting from Twitter, and countless semi-famous people can take advantage of "1000 true fans" or long tail economics, or any other buzz-wordy thing that Twitter gives access too. Does Brad Pitt benefit financially from Twitter? Probably not. But Brad Dourif would.

This means that agents, publishing houses, TV stations, production companies, etc., are also profiting from these individual's profits.

Then there are the corporate tweets that DO seem to work. Dell fires out one of its Deals of the Day to Twitter before it goes online. Experiments to sell T-shirts have had decent success on Twitter. A smaller company like Threadless or the like woudl probably succeed in this avenue as well. Coupons are sent out to followers of other sites.

People and companies ARE profiting from Twitter. But Twitter isn't.

Twitter is free. It has no advertising, and, in fact, no business plan of any kind. Right now they're just building a brand and getting as many users as they can. They'll figure out how to monetize it later.

The thing is, I don't see how they will. I'd guess the majority of users don't actually go to the Twitter website all that often. There are dozens of methods of reading and posting without ever typing in the URL. Hell, the SMS feature is a driving cause of the popularity. They can't put in-line ads in, because that would exceed the 140 character limit. The only "traditional" method that comes to mind is the service randomly sending out advertising tweets to ALL users. These would be unblockable. They might finesse them much like Google does by storing and scanning a users tweet history and who they follow, so that ads could be customized. I think this would be annoying, but not SO annoying that it would cause people to leave. Especially if you made sure it was only, say, 1 ad tweet in every 10 or 20. Those who follow a ton of people could effectively ignore the ads in the morass of updates, and those who don't wouldn't find themselves inundated in advertising.

BTW - Typing "tweet" so much is really getting annoying.

I wonder though, if running Twitter as a non-profit would be a better idea. What if the various recording companies, publishers, movie studios, or even individual entrepreneurs contributed financially? They all benefit from Twitter, so it would be more of an advertising cost than an investment with direct returns. They'd all effectively become shareholders or venture capitalists. In other words, Twitter might never turn a profit itself, but the revenue generated from fans of the individuals on Twitter for the companies that have contracts with these individuals would be the draw. Random House could tell all its authors to open a Twitter account and update from time to time. Sony music would do the same with its artists (actually, Sony would open its own version of Twitter which would only work with Vaios, and nobody would ever use it). Twitter groups could be set up, so that everyone under a corporate brand would be part of that group. If you like Gaiman, maybe you like someone else his publisher has under their umbrella. Twitter tags, twitter recommendations, and other well-trod ideas could be implemented and fan-controlled.

This would keep Twitter free for us regular folks, and could avoid direct advertising. Again, people don't think of John Hodgman talking about a book signing as advertising, even though it results in them going to that book store and buying his book for him to sign.

Just a thought.

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