The Noisy Channel

 

Is Twitter Planning To Monetize The Firehose?

October 8th, 2009 · 9 Comments · General

A few months ago, I wrote in “The Twouble with Twitter Search“:

But the trickle that Twitter returns is hardly enough.

I believe this limitation is by design–that Twitter knows the value of such access and isn’t about to give it away. I just hope Twitter will figure out a way to provide this access for a price, and that an ecology of information access providers develops around it. Of course, if Google or Microsoft buys Twitter first, that probably won’t happen.

Now that Twitter has raised $100M at a valuation of $1B, I doubt any acquisition will happen anytime soon. But, according to Kara Swisher’s unnamed sources:

Twitter is in advanced talks with Microsoft and Google separately about striking data-mining deals, in which the companies would license a full feed from the microblogging service that could then be integrated into the results of their competing search engines.

If so, then it’s about time! How much either Microsoft or Google would pay for this feed is an interesting question. It’s probably not a coincidence that Twitter raised its last round of funding before pursuing this path–the revenue they obtain this way could be significant, but is unlikely to justify a $1B valuation.

In any case, I’m excited as a consumer that Twitter may finally allow Google and Microsoft to better expose the value of its content. But I’m also curious what my friends on the Twitter Search team think of the potential competition from the web search titans. Until now, no one has been able compete effectively with Twitter’s native search because of  lacking access to the firehose. Having such access would give Google and Microsoft more than a fighting chance. Given the centrality of search to Twitter’s user experience, it’s an interesting corporate strategy.

9 responses so far ↓

  • 1 Jrome // Oct 8, 2009 at 9:59 am

    The value of the firehose can and will, I believe, extend beyond one or two deals with the search giants. The data could be broken out at a variety of levels to a multitude of players – consider hyperlocal search for localized media/news sites as just one of many variants. In my mind Twitter stands to gain more from thousands of such deals than from one or two megadeals.

    However, any deal with Google or Microsoft for access to the Firehose will be a great way to showcase the power inherent with millions of tweets per day and it will surely grease the wheels for the smaller deals to come.  

  • 2 Daniel Tunkelang // Oct 8, 2009 at 12:10 pm

    Jrome, that’s a fair point. It really depends what Twitter negotiates with G or M. My concern for Twitter is that runs the risk of becoming a dumb pipe if Google, Microsoft, or anyone else has the ability to repackage that data themselves. I’m sure the folks at Twitter are aware of this danger, but I imagine that it will make the negotiation of terms an interesting challenge.

  • 3 Chris Brown // Oct 8, 2009 at 2:52 pm

    I wish that I had someway to tap into twitter money.

  • 4 jeremy // Oct 8, 2009 at 3:11 pm

    I wonder when users are ever going to wise up, and only use services in which they get a cut of the profits whenever their own data is being resold.

    More and more businesses are starting to operate on this model, and I don’t know if I’m completely comfortable with it.

  • 5 Daniel Tunkelang // Oct 8, 2009 at 3:38 pm

    Hey, if I’m getting a service I value without paying cash for it, then I expect the provider to try to make money off of me somehow. I may be able to block ads, but I can’t block them from monetizing my data if the terms of service allow for that. If I don’t like the terms, I can go elsewhere. But I hardly feel entitled to profit sharing when I’m getting a free lunch as it is.

  • 6 jeremy // Oct 8, 2009 at 6:05 pm

    I don’t buy (ha! pun!) the “it’s already free” argument. For two reasons:

    - Network effects provide an effective glass wall around going elsewhere

    - The “give it away for free but make money on them behind closed doors” model is becoming ubiquitous. Maybe it’s a slippery slope to say so, but effectively there is no “elsewhere” to go. There is no real choice one can make. The moment one logs on to the internet, one’s activity is being bought and sold. The only option is to not go on the internet at all. And is that really the society that we’re trying to create?

  • 7 Daniel Tunkelang // Oct 8, 2009 at 6:19 pm

    I guess I don’t feel exploited by free online services–at least not yet. Don’t get me wrong: I’m not happy with the dominance of the ad-supported model, and I’ve said as much repeatedly. But I don’t feel forced to use Google, Twitter, or any other free online service. It saddens me that there isn’t a sufficient market to support alternatives, but that’s just the way market capitalism works. Changing the current landscape is a very ambitious project of education, persuasion, and innovation.

  • 8 jeremy // Oct 8, 2009 at 6:30 pm

    It saddens me that there isn’t a sufficient market to support alternatives

    That was my main point, in my first comment.

  • 9 MarkH // Oct 9, 2009 at 3:26 am

    Anything that can be easily reproduced will naturally tend towards a free pricing model. You can see this effect going on in the itunes app store.

    If you start charging, the crowds will jump ship to the first free alternative and your community is gone.

    Think beehives and honey….

Clicky Web Analytics