Although we first heard about it a few weeks ago, today Twitter has gone official with their purchase of UK-based Tweetdeck, makers of the popular desktop social media client of the same name. The papers were finally signed yesterday, with Twitter reportedly paying between $40 million and $50 million in cash and stock.
The aggressive move on Twitter’s part came as a reaction to Twitter client powerhouse UberMedia (who purport to control almost a quarter of all traffic to the site through their clients, which are available across a range of devices and operating systems) attempting to buy the company to further expand their reach. Twitter, who publicly discouraged developers from making vanilla Twitter clients that compete with their own, stepped in with a bigger offer to ensure UberMedia could not grab even more of their traffic.
So why does Twitter care? The simple answer, unsurprisingly, is money. Twitter has a huge problem with revenue (which is why we’re guessing a good chunk of the purchase price was paid in stock), and has tried a whole host of measures to monetise their service. This has included promoted trends, however these have attracted criticism for low clickthrough rates and poor localisation. For example, as I write this from the UK I’m seeing a promoted trend for Sprint – a company that does not exist on this side of the pond.
Twitter also offers promoted tweets, and is said to be working on a professional analytics suite that enterprise customers will no doubt have to pay for. Despite all these efforts Twitter is still not anywhere near turning a profit – and because a huge percentage of their traffic is through mobile apps they are keen to own all of the mobile app traffic, to monetise as they see fit. Although the first-party Twitter app is the most popular (with 10-50 million downloads on Android, compared to UberMedia’s 5-10 million), UberMedia are snapping at their heels and, somewhat amusingly, seem to have put together a revenue model that sits atop the Twitter ecosystem and actually works, comprising advertising and premium apps.
The cold war between Twitter and UberMedia turned sour earlier this year when Twitter suddenly blocked UberMedia’s software, citing copyright violations and T&C infringements. Their service was quickly restored, although there appears to be no love lost between the two firms.
The other sticking point now is what Twitter will now do with Tweetdeck. Tweetdeck’s desktop client is seen as the “power-user” solution, as it allows multiple accounts and features such a Tweet scheduling. However, it can also be used to access other social networks, namely Facebook and FourSquare. Whether Twitter will allow Tweetdeck to continue sleeping with the enemy is unknown. The future also looks fairly bleak for the well-received Android and iOS versions of Tweetdeck, which are now in direct competition with Twitter’ own client.
