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Will Twitter's New Ad Platform Turn the Tables?
By: Jeff Louis
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According to a study conducted by the University of Massachusetts Dartmouth and Financial Insite Inc., a Seattle-based research firm, the Fortune 500's use of social media is on the rise, with Twitter the leading choice of social vehicles in 2009.

The fact that Twitter is growing should surprise no one, for the site has provided application developers plenty of monetizing opportunities without making moves to cash in for themselves.

Until now. Twitter recently explained their plans for developing an advertising platform, and on the heels of this, one of Twitter's main financial backers, Fred Wilson, of Union Square Ventures, challenged Twitter's application developers to "develop killer apps" and not fill holes in the platform.

What does this mean to application developers such as Tweetdeck, HootSuite, bit.ly, yFrog, and thousands of others that have helped make Twitter popular by designing desktop clients, mobile applications, photo-uploading services, and URL shorteners? According to some, this may mean "buh-bye" to the applications. 

Currently, Twitter handles 50 million tweets per day, up from 2.5 million at the beginning of 2009. This undoubtedly comes partially due to the Application Programming Interfaces (APIs) that work with the site.

API developers have built applications -- at no charge -- because they were allowed to profit from advertising, but now it looks like these money-making opportunities are threatened as the ever-careful Twitter team has begun to move toward the future. Naturally, this has caused quite a bit of tension among the application developers. 

Chirp, the annual Twitter/developer conference scheduled for April 14-15 in San Francisco, may see Twitter "transform overnight from generous benefactor to arch competitor to their start-ups."

"When we launched, Twitter was incomplete," said Evan Williams, Twitter's co-founder and CEO, "so developers rushed to fill those holes, but eventually we’re going to have to build a lot of features in because they should be there. We want to set those expectations.”

Among the various developers, which ones stand to lose the most? According to Business Insider, possible losers include, but aren't limited to:

  • TwitPic
  • Tweetdeck
  • HootSuite
  • Bit.ly
  • Tiny URL
  • Twitterific
  • TweetPhoto
  • yFrog

While application providers becoming competitors with a host site or service isn't new  -- Apple and Adobe are entering into a similarly complex battle -- Twitter has been open with developers, allowing them to access and use data to create applications without notifying the micro-blogging site of their intentions, let alone striking an agreement with them.

The developer's goals, of course, are to profit on their applications, hoping they'll either be able to coexist with Twitter or be purchased by them. None, however, want to compete directly with Twitter.  

In any event, apps builders now have to face the fact that Twitter, while seemingly slow to make large jumps, has initiated a risk-averse, calculated strategy toward reaping what they, and others, have sown. 


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About the Author

Jeff Louis: Media Planner, Brand Project Manager, blogger, and aspiring writer. Please leave a comment or get in touch with Jeff on Twitter. As always, thank you for reading!

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