By now it’s a well-worn path for startups: an ingenious idea, explosive growth, a fresh business model anchored to ad revenue, and, if you’re lucky, a wildly successful IPO. But just take it from Facebook, the growing pains won’t end there.
Before Twitter makes its public offering, it needs to prove its merits as a business, not simply its popularity among non-paying users. Although promoted tweets appear to be doing well, Twitter is hoping to tap the multi-billion dollar television industry to strengthen its position.
Yes, we’re talking Social TV. The stakes are high. As it shores up revenue, media experts are wondering if Twitter is reshaping its identity by moving from micro blogging service to a content creating, media company.
In May, Twitter’s UK GM, Tony Wang, urged broadcasters to adopt Social TV strategies for their own good. “Broadcasters are not the ones to choose whether to have social TV. It happens whether they like it or not. But they have a choice about how to harness that social TV energy,” he cautioned. Though his message was packaged as advice for broadcasters, it is clear that Twitter has real interest in cultivating its relationship with TV.
In June, Twitter appointed Fred Graver, creative director for Twitter partnerships, to focus on those relationships. That Graver is a well-seasoned TV executive did not go unnoticed.
Twitter has already made high profile agreements in recent months, notably with NASCAR and NBC for their coverage of the 2012 Olympics. In both instances Twitter is testing its editorial chops.
In the meantime, speculation regarding Twitter’s media ambitions continues to grow. Twitter CEO Dick Costolo recently told The New York Times, “Our business is an advertising business, we don’t sell technology.” He added, “I don’t need to be or want to be in the content business.” A few days later, Adweek came out saying Twitter is “in serious talks about the possibility of launching several original video series”.
For now, outsiders can’t be sure what to make of Twitter’s moves. One thing we do know is that Twitter is willing to experiment and it is sincere about pushing forward into the lucrative television market. Some are skeptical, saying that the company is deviating from its core service. Like any other business, Twitter will have to walk a fine line between turning profits and turning off customers.
Just yesterday it surfaced that Apple may be considering a stake in Twitter. While Apple hopes to leverage Twitter’s social aptitude, Twitter enjoys the privilege of being baked into the most popular “second screen” devices on the planet. A healthy relationship with Apple will ensure that Twitter remains an important part of the Social TV experience.
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