How will Twitter make money?
Ummm . . . I don’t think it’s as big of a dilemma as people seem to think.
We haven’t focused on it yet and I can’t say for sure how it’s going to work. Evan Williams
Jack Dorsey, raised in St Louis Missouri, took to programming from a young age. At fourteen he developed software for despatchers to route taxis, couriers, cycle and motorcycle messengers, pizza delivery teams and emergency services.
He qualified at Missouri University of Science and Technology, then New York University. He worked at DMS, a significant courier service, once again on despatch software.
He moved to Oakland California at the age of twenty-four and formed a company to develop despatch software ideas. Despatchers have to regularly ask their teams ‘Where are you?’, ‘What are you doing?’ using a mixture of radio or phones, and later emails or mobile texting. He sought a way to combine texts, emails and web instant messaging to create a broad mobile and Internet-based real-time service.
He experimented with the research using the Motion RIM 850, forerunner of the Blackberry. But it needed everyone to be provided with one, and at $400 a pop this was too expensive. It was the mobile SMS service that attracted him because it transcended many services and devices.
Dorsey joined Odeo (the Blogger.com inventors) and it was with its Evan Williams and Biz Stone that he took his notions forward.
A brainstorming session held in 2006 considered the next steps for Odeo. Williams urged Dorsey to describe his thoughts for a cross-system short messaging approach for the courier business and the general public too. Initially they called the service ‘status’ or ‘stat.us’ in that it told others of your current status – where you were, what you were doing.
It was Williams who came up with the final name by comparing the proposed traffic to the chatter between birds, short bursts of seemingly random information – hence Twitter. My preferred definition is the rather English and pompous ‘drawing room chatter’.
The word could be used as a noun or a verb and suffixes could be added. The action would be ‘twittering’; if you were getting too many messages you would be ‘twitterpated’ and so on.
Dorsey (@jack), Stone (@biz) and others took just two weeks to come up with version 0.1.
‘twittering’; if you were getting too many messages you would be ‘twitterpated’ and so on. Dorsey (@jack), Stone (@biz) and others took just two weeks to come up with version 0.1
The messaging service focused on mobile SMS as it could bridge the gap between PCs and mobiles. SMS allowed the user 160 characters per message before it broke it into packages. A tweet was set at 140 characters, twenty characters reserved for the Twitter username and a colon.
They needed a five letter SMS code and selected ‘twttr’, inspired by Flickr but ‘twttr’ was unavailable so they used ‘40404’ as its US SMS short code and reinstated the service name Twitter.
Dorsey sent the first ever web-based twitter at 9:50am on 21 March 2006. ‘just setting up my twttr’
The service registered users at no charge and they could then send and receive ‘tweets’. Initially it was used by fifty people at Odeo.
Users controlled their network of ‘friends’ and could keep friends up to date with what they were doing, where they were and of course it was possible to arrange meetings or carry on group conversations.
Instead of needing to send a series of texts, instant messages and emails to individuals, Twitter automatically delivered a message to all your friends and contacts in one action.
And here was the clever bit – delivery could be to a PC, a laptop or via SMS to a mobile device. In the US mobile users texting 40404 could send a Twitter from a PC or mobile. The mobile operator’s short messaging service centre received the message and passed it to Twitter.
To add attachments, such as photos, music, or video, the tweet could send a web address showing where these were to be found. To facilitate this Twitter reduced any lengthy urls into usable ‘tiny urls’ using an acquired domain called ‘t.co’.
Users could ‘follow’ the tweets of others. Many used the ‘follow’ feature to create a new and abbreviated form of blogging, known as ‘micro-blogging’. Micro-bloggers loved the almost haiku-like discipline of expressing themselves in just 140 characters; though of course the Japanese haiku is shorter at just seventeen syllables.
Twitter showed ‘Trending topics’ links on the search page to highlight the current buzz. The service introduced a ‘hashtag’; by placing the # (hash) symbol before a word, for example ‘#haiku’, then Twitter Search would find all mentions of haiku in the Twittersphere.
Mobile users usually had to pay for texts and Twitter was not an overnight success when it launched publicly in July 2006.
March 2007 At the South by Southwest festival Twitter was used to display seminar attendees’ comments and messages on several large plasma screens as they left the sessions.
Twitter became the talk of the show and won an award. The Twitter team responded by tweeting, ‘we’d like to thank you in 140 characters or less. And we just did!’ This exposure at the SXSW event trebled the tweets from 20,000 to 60,000 a day. A similar process was adopted at the MTV Awards and at Apple’s Worldwide Developers Conference.
A month later Twitter Inc became a stand-alone operation with Dorsey as its CEO.
2008 Twitter had a hundred million tweets each quarter. Having no revenue stream Twitter had a second round of fund-raising, achieving $22m. By 2009 it was the third-largest social networking site and had attracted a further $35m investment.
Many criticise tweets as inane, but the ease and freedom of tweeting became a cause for concern. One notable case was a confidential trade union negotiation with British Airways. The content was being tweeted real-time to the outside world by a trade union official. When the WikiLeaks founder was in court fighting extradition to Sweden, the court ordered that journalists were not permitted to tweet.
Mid-2010 Traffic had increased to 65 million tweets per day – 750 every second! Twitter permitted paid-for advertising from Red Bull, Starbucks and others. By that autumn it had 175 million registered users and 95 million tweets a day.
2010 Lady Gaga had around 7.5 million followers; others in the top ten included Barack Obama and Oprah Winfrey. CNN Breaking News was only 17th, yet CNN ranks as the longest to remain in the top 100 – over four years.
It was rumoured that Twitter planned an IPO in 2013, by which time it was suggested they would have a billion users, $1.5 billion in revenue and over $100 million profit. Twitter promptly denied these figures and threatened legal action.