I have an ongoing email thread with another SaaS app developer about how social networks are closing access to their data, APIs, and members, and its impact on third party apps such as Triberr. The discussion primarily focuses on Twitter, but applies to the other social networks and the Big G(oogle). Since it’s relevant to both the SaaS industry and our users, and drives business decisions for many apps, I wanted to share my thoughts and predictions.
We have a love / hate relationship with Twitter. Our app relies heavily on it (a bit too much in my opinion). Even after questionable moves this past year such as removing share counts, it seems like the company is really making an effort to find its footing again in 2017. In fact, they recently gave their abuse policy a much-needed refresh, which will help in repairing its damaged reputation. Unfortunately, that doesn’t do much for the bottom line.
Something’s up with Twitter – whether it be good, bad, or ugly. I can’t pinpoint exactly what’ll transpire this year but Twitter did make some positive moves last year such as:
- Loosening the 140 character limit (ex: replies, photos, links, and usernames do not count towards the limit)
- Moments – Moments allows us to collect and curate Tweets to tell stories
- Twitter Polls
- Launching Engagement
Whether or not the above changes will help Twitter make more money and grow is yet to be determined. In the end, the metrics that will matter to investors will be growing the user base, MAUs (monthly active users), and profitability.
While such updates are well received by its user base, the following series of actions are concerning:
Twitter is For Sale
There was a lot of buzz in September 2016 when Twitter was for sale and several large companies were mentioned as suitors. Unfortunately, none of the companies were interested enough to make an offer – Google, Facebook, Apple, Disney, Salesforce, Verizon, Comcast. They all passed on a potential acquisition. No surprise – $18 billion for a company no one wants to buy is unjustifiable. Given its lack of growth and concerns about future earnings potential, the share price slid back to pre-rumor numbers.
Whine about Vine
In October 2016, Twitter announced it would be shutting down Vine – the entire social video network. It seems some influencers tried to save Vine, but to no avail. In my opinion, Vine could’ve been Twitter’s answer to Snapchat, YouTube, and Instagram, but it wasn’t executed well nor in a timely manner. Circumstances! As influencer marketing starts to become a channel for most brands, Vine is no more and their users previously driving billions of views have reluctantly shifted their audience to the competitors.
It’s always sad to hear about layoffs at any company. However, for Twitter, layoffs were inevitable after finding no buyers. It wasn’t shocking that Twitter had to layoff hundreds of their employees at the end of 2016, and lost some key personnel in the process. Unfortunately, it’s a necessary evil for sustainability and profitability as they admitted at the end of Q3-2016.
“The restructuring allows us to continue to fully fund our highest priorities, while eliminating investment in non-core areas and driving greater efficiency,”
The downsizing in Q4-2016 impacted 9% of its staff across sales, partnerships and marketing efforts. The hashtag – #TwitterLayoffs – may be quiet at the moment, but I think the hashtag will resurface again in 2017… sad 🙁
Twitter Dashboard Shutdown
On January 11, Twitter announced it will shutdown Twitter Dashboard – a tool used to manage business accounts – which gives businesses a suite of tools to track tweets, schedule posts, access analytics, monitor tweets about their brand or other keywords and more. With no alternate mentioned, the tool will officially shutdown in a few days on Feburary 3rd, 2017.
Why is this important? It was a tool specifically for businesses – ya know, actual companies with money to spend and advertise. Unfortunately, there just wasn’t enough traction to justify its continued maintenance and support. Worth noting is that it had only been launched 6 months prior to the shutdown announcement which should provide some insight into how quickly priorities changed in such a short timeframe at a massive company.
Fabric and Crashlytics
On January 18, Twitter quietly sold Fabric and Crashlytics to Google. These tools were used by developers to build better apps, understand their users, and grow their business. While it’s not a big deal for regular users, the sale signals Twitter’s lack of interest in maintaining or growing its developer ecosystem.
Say Goodbye to the Buy Button
Launched in 2014, you may have recently noticed the Buy Button is disappearing. Last year, Twitter disbanded their commerce team which made it clear that no further development was expected on the Buy Button. Now, it’s official. It pains me to see a revenue-generating feature being removed, but Twitter plans on focusing on action-based marketing such as website conversions and lead generation. I’m not entirely sure this will work in the noisy Twitter-sphere.
Silence. Periscope lets you explore the world through the eyes of somebody else. Unfortunately, I rarely hear anyone talk about Periscope so I believe it’s going by the wayside soon to join Vine. Hopefully, it surprises me, and everyone else, and becomes a smash hit. I just don’t see it happening given the chronological pattern of events in the Twitter portfolio.
Closing Access to Data
Historically, Twitter does not have a great reputation with developer community. I’ve personally worked on applications that leveraged Twitter’s API only to find functionality suddenly unavailable or new limits imposed resulting in devaluing our apps. Here’s a summary of Twitter’s 10 year struggle with developer relations. Most notable are the removal of share counts, handling of oAuth updates, and the lack of analytics data for third party developers (unless you’re willing to pay thousands per month to Gnip for access). However, I don’t blame them for gradually being protective about their data as other social networks have done exactly the same by closing off parts of their APIs to only approved partners or apps.
In my opinion, social networks will continue to create a moat to prevent third parties from accessing their data which equates to less and less apps built on these platforms. The big social networks want to own your time! For example, Facebook has 50 minutes of your time – every day! And they certainly do not want you spending it on third party apps.
Why is this important to you?
Since these networks have reached critical mass, there’s an obvious pattern and desire to build a moat around their network. This begs the question what will happen to third party apps that rely on these social networks?
- Instagram already shunned developers at the onset by closing off most actions via its API to control the user experience. If you’re a startup focused on Instagram, you’re already dealing with a closed API that does not allow directly pushing posts to Instagram (must be done via their app).
- Twitter removed shared counts and access to analytics data and puts it behind an enterprise subscription nobody can afford.
- Facebook is tightening its API with regular releases each further limiting developers or requiring special permissions / app reviews.
- As one user said: Facebook is “following in the footsteps of Instagram and Twitter in limiting data outflow when it no longer benefits them.”
- Snapchat laid down the law on third party apps a while back.
The writing’s on the wall.
If you’re a company that depends on the social APIs, are you comfortable knowing the big networks can limit or close access at any time? I’m not. As developers, we have to be careful how much reliance our apps have on these companies. Users helped grow these giant social networks to the their current size and scale. Now that they’ve reached critical mass, they don’t need us. Therefore, we need to be careful not to put all our eggs in one basket.
If you’re building an online presence, the question to ask is who really owns it?
If you’re an influencer or blogger, does the demise of a single platform impact your earnings potential or traffic significantly? A million or many thousands of followers on any platform on the brink of disappearing is worrisome. The effort to build such an audience is time consuming and requires commitment.
Bottom line: Take steps towards owning your online presence and community (cough cough, ** tribe **).
I’d love to hear your thoughts on how much you’ve invested into Twitter? and do you continue to do so?
Amazon, Please Help!
I believe that of all the companies that would be a worthy buyer, Amazon has the resources and ecosystem to actually do something with Twitter. Given their reach is already extending into a variety of areas:
- Media and Partnerships – The rollout of Amazon Prime Video competes directly with Netflix, and Twitter can help. Additionally, Twitter’s streaming and advertising partnerships with NFL and other giants can be leveraged by Amazon for all sorts of cross-marketing fun.
- Advertising – Other than their main site, Amazon doesn’t have a strong advertising channel to compete with Google and Facebook. Twitter could be that chip.
- Social – Amazon has no social presence whatsoever. Playing catch up to Facebook’s platform + Messenger, Google and Google+, and Microsoft + LinkedIn will not be fun starting from ground zero.
- News Content – From a news standpoint, Jeff Bezos owns Washington Post and it’s making progress going digital and growing subscribers. Twitter can provide a nice boost to solidify hockey stick growth.
It may sound ridiculous but I truly believe this acquisition would be a win-win.
Overall, whatever decisions Twitter makes this year will either make or break the company. I’m hoping it finds its stride and starts making money – after all, 10 years is long enough to figure it out. Better yet, Amazon can play hero and saves them from bankruptcy. On the bright side, the fact that Twitter is going to be a much friendlier place this year is a great way to start 2017.
Let me know your thoughts below, and let’s all hope that Twitter perseveres through these rough times.