The news of Twitter acquiring the biggest independent application that people use to tweet - Tweetdeck - was confirmed yesterday. The Old St, London-based startup sold for a rumoured £25m to Twitter. Rumous of the sale had been reported for a month now, but confirmation came from Twitter last night on its own blog.
Two people asked me yesterday why Twitter made this acquisition? What's in it for them? In short, Twitter has just bought itself three new revenue streams. Here's why:
- One in 20 tweets come from Tweetdeck. That means 5% of this content is not wound up in the Twitter revenue model - advertising. Twitter has just bought itself a new revenue stream
- Tweetdeck users are highly engaged. They have multiple searches running at the same time, are sometimes logged into several accounts at once, and for them Twitter is the main focus on their computer or mobile screen, not just another tab in their browser. This engagement means better response to the advertising and again, a revenue stream
- Tweetdeck is a terminal, similar to Outlook for email. And Outlook isn't free. It is not too far a stretch of the imagination to see Twitter rolling out premium services through the installed software that Tweetdeck runs on and charging users for it. Power tools that rely on your device, not Twitter's own servers. This would not only make them money, but save them on computing costs
I'm a huge fan of Tweetdeck, but it's not the only way I use Twitter. I'm an even huger (word?) fan of Old St's Silicon Roundabout, and it's great to see this deal pull off between the two companies.