30th Jun 2012
Twitter and the API Pivot.
A long time ago companies began the practice of releasing bad news on Fridays. Originally this was used as a strategy by public companies to mitigate negative impact on their stock prices. But history has shown this really doesn’t work.
Regardless of that, Twitter tried to quietly announce upcoming changes to their API today. Set aside your surprise that a company built on the near-instant global spread of information would try to sneak this one past today’s always on Web culture, and have a look at what this could mean for the future of the service itself.
Twitter began as an SMS service. Tweets could — and still can — be posted by sending a SMS to 40404 from your registered device (this is where the 140 character limit came from, in case you didn’t know). Adoption was low. Then came the website where people could post and read tweets with a more visual interface. Adoption was still low, relatively. Twitter was all the buzz at SXSW in March 2007, and that helped growth a bit. But when they released the API early 2008 growth skyrocketed.
Source: Hubspot
We built this city
Once they allowed 3rd party developers to create apps on top of their platform the ecosystem grew exponentially. With the growth of that ecosystem came droves of users. Now Twitter is arguably the 2nd most popular social platform on the planet. Sure, the timing was helpful, but the influx of wonderful 3rd party apps allowed people to choose a nuanced experience that was right for them, accelerating adoption dramatically. Twitter recognized this when they purchased Tweetie as a shortcut for building their own app, and acquired Summize for search. Of course they couldn’t have sustained all that growth and made the acquisitions they did without capital, and that came from VC. Here’s where things get interesting.
VC always wants its money back
Now that they’ve achieved supremo status, it’s time to think about how to make revenue and repay the investors. Absolutely nothing wrong with that, they have every right to do so. The question is always how. They’ve been charging for access to the “firehose” for a while, but that’s not enough. We all know they’ve toyed with different advertising mechanisms, and several of them work reasonably well. The trouble is inserting sponsored or “Expanded Tweets” into the API timeline can be difficult to monetize without disrupting the ecosystem. So what are they doing? Exactly what startup pop-culture advocates. Pivoting.
Shut her down cap’n
You need to be able to see expanded Tweets and other features that make Twitter more engaging and easier to use.
This is how they’re spinning the API change. Expanded Tweets are more engaging (e.g. profitable) and therefore they need to force them into as many eyeballs as possible. Reasonable strategy, but it’s divergent from what made Twitter strong in the first place. Disruptive, in fact. They go on to say:
Back in March of 2011, my colleague Ryan Sarver said that developers should not “build client apps that mimic or reproduce the mainstream Twitter consumer client experience.” That guidance continues to apply as much as ever today. Related to that, we’ve already begun to more thoroughly enforce our Developer Rules of the Road with partners, for example with branding, and in the coming weeks, we will be introducing stricter guidelines around how the Twitter API is used.
Stricter guidelines. We can only interpret this to mean they will either force adoption of Expanded Tweets (and, one can assume, other revenue generating mechanisms) into the API timelines or terminate API access for violation of the Rules of the Road. I hear throngs of 3rd party developers squirming at the thought of it now.
About disruption and pivoting
We hear a lot about being disruptive to a market, and pivoting to correct course. These are words the startup culture likes to toss around alongside other buzz-terms like “fail fast”, and it’s all decent advice, in context. What I feel Twitter may be ignoring is that when they radically pivot away from the ecosystem that helped them grow, they’re essentially turning their backs on the very developers and loyalists they need to sustain the business. Worse, by eradicating 3rd party apps they take away the nuanced and customized experiences people love about using the service. As I quipped already, I would seriously question using Twitter if I couldn’t use Tweetbot or Echofon. Those apps enhance Twitter in a way that is meaningful to me. Take it away and you’ve taken much of the value with it.
Now I know the people in the boardroom at 795 Folsom are much smarter than I am, and they have more knowledge of the internals of the business. But I’ve also been around this block enough times to have seen companies ’pivot’ just enough to create space for a new kid to carve out a spot in the market.
When you sell out, people go home
If Twitter does decide to shoehorn monetized content into everyone’s experience they run the risk of pushing people away. Once that happens, they are ripe to be disrupted. Let’s hope they choose to fail fast on this one, and pivot back the other way.
