Tag Archives: Twitter

Why doesn’t Twitter have local AU advertising sales?

For the past 12 months, Twitter’s Australian usage has remained around 2m people per month. That’s 2m people – not 2m unique browsers – and that’s consistent (plus or minus 5% either way) since mid 2011 (according to Nielsen).

And the user engagement is decent. 6+ visits per month, almost 30 mins spent on the twitter.com site per month. (source, again Nielsen)

Add mobile traffic and the third party clients (Hootsuite etc) and the number is probably closer to 2.5m, maybe 3m.

So … here is this platform doing very solid, consistent numbers in Australia. It has a lot of data on its users and even now still has a tonne of hype. Combine that with its relatively sluggish US revenue (in comparison to its current valuation) and Australia’s relatively high yield when it comes to digital advertising (far higher than the US and the majority of Europe) and it’s odd that Twitter hasn’t done what Facebook has done in Australia and set up a sales only office. Continue reading

Stating the obvious: Great content requires funding

It seems like an obvious statement but great content requires funding. Without it, it’s difficult to create things people want to read, watch and spend time with.

Funding happens in numerous ways. Free to air TV networks pay content creators upfront for first run programming, they invest heavily in rights deals around sports broadcast, effectively taking a calculated punt on shows and events that advertising revenue as a result of ratings will ensure they at a minimum don’t lose on the investment. Pay TV stations do the same – secure programming through initial investment, or invest in original programming – and pay TV operators globally pay significant carriage fees to pay TV stations in order to carry their channel. For instance, ESPN in the US (and in Australia) receives a monthly fee per month for every house the channel is carried in.

Right now it seems like a good time to look back on the early history of ESPN. In the early 80’s the station found itself in the middle of an emerging content area in a rapidly developing yet embryonic media channel. Consumer demand was promising and ESPN was developing a stable and growing audience. However, ESPN was struggling to fund its current content and operating costs, let alone enhance and build its content suite, on a solely advertiser funded model.

That’s because ESPN was running was one stream of revenue – advertising. Just like 99.9% of websites today are – many of whom are facing the same problem … advertising revenues are proving inadequate in terms of funding the development of content.

What ESPN did at the time was radical. It went to the cable providers – such as John Malone’s TCI – and asked them to pay a fee to carry ESPN as part of their cable bundles. At the time ESPN asked for 25 cents. Malone was outraged. He threatened to start his own sports only competitor. Eventually he buckled. This allowed ESPN to further secure content – such as MLB and NFL football – and grow and evolve the product. ESPN’s plea to Malone was simple – this fee for carriage was essential for the survival of both companies. ESPN needed more revenue to continue to develop a compelling product, and Malone’s TCI relied wholly on having a suite of compelling content creators that people would pay to pipe into their homes.

I wonder whether we need to revisit what ESPN did here in 2012. The Internet’s most dominant companies seem to be companies not entirely different to what TCI’s core business was in the early 80’s – distributing content but not investing in it. Google, Facebook, Twitter etc – are not in the business of creating nor helping fund content. It raises the question – who is going to pay for content online? One thing seems to be clear – great content online needs more revenue streams than advertising.

Just as a side point, ESPN now receives almost $5 per month for each household it is piped into in the United States, and similar amounts in other cable markets, including Australia.

Here’s a radical proposition. Can you imagine Google, Facebook, YouTube or Twitter investing upfront in content creation? I don’t mean a few million here and there, I mean the sorts of multi billion dollar bets the large TV and cable companies place. Here are businesses that rely wholly on content created by others, but whom are unwilling to help pay for it.

And why is it that companies that do invest heavily in content on digital platforms – Yahoo, Newscorp, the NYT for example – are often laughed at by digital insiders as out of touch?

Cable and Pay TV has the jump on digital as its dual revenue stream of advertising plus fee for carriage offers content producers security upfront that great content can have its costs covered. It is what is creating shows like Mad Men, Game of Thrones and Dexter, as well as evolving coverage of NFL and major sporting events.

Until this happens, can anyone really see ‘marquee programming’ moving online? Under current digital approaches (revenue share at best 60-120 days after payments) could you ever see a show as strong as Sons of Anarchy or The Borgias being first run online? Doubtful.

Great content requires significant investment. Why is it that the highest valued digital companies, who all rely heavily on this content, refuse to invest in it?

Twitter: Far From the ‘Worlds Worst Tech or Media Business’

Last week, gawker.com ran a story around Twitter and its financials. You might have seen it. It had the not at all sensationalist headline “Twitter’s Secret History as the Worlds Worst Tech or Media business” and it had claims from ‘a source’ around Twitter’s revenue and spend levels.

Continue reading

Facebook/Twitter/myspace – some AU numbers

Is it just me , or is it weird when people talk about a product that is taking the world by storm but they don’t have any local consumption numbers around it.

That seems to be the case with Twitter in this market … ‘yeah it’s massive, we should be on it’ is the call … but generally it’s not backed up by usage numbers, patterns etc.

So here you go – I’ve looked into trusty Nielsen Netview and gotten some lukewarm, mushy facts around some key areas

– How many people are using the product?
– How long are they spending per month on it?
– How often do they return
– What is their key demographic?

Facebook

– How many people are using the product? 4.7m people in AU
– How long are they spending per month on it? 3 hours, 50 minutes
– How often do they return. Over 14 times a month
– What is their key demographic? 32% of Facebook users are aged 25-34

Myspace

– How many people are using the product? 1.9m people in AU
– How long are they spending per month on it? 55 minutes
– How often do they return. 5.6 times a month
– What is their key demographic?  28.5% of myspace users are aged 12-17

Twitter

– How many people are using the product? 780,000 people in AU
– How long are they spending per month on it? 10 minutes
– How often do they return. 3.6 times a month
– What is their key demographic? 36% of Twitter users are aged 35-49

Ok so what are my takeouts.

1/ Facebook is huge. Despite some whinging about the new interface time spent per month keeps increasing. The usage patterns around this property are phenomenal. It’s a shame the digital strategist types have jumped onto a new wagon (Twitter) as Facebook is surely worth further investigation

2/ Twitter is growing, sure, but lets be realistic here. Users are spending around 10m a month with the product – hardly earth shattering. And most return on average just over 3 times a month … again, very low for a so-called micro-blogging service (I’d assume active users would be on multiple times a day not multiple times a month). Before anyone trips me up, yes I am aware that this doesn’t include products like Tweetdeck etc … anyway, having 1/2/3m users doesn’t mean anything really unless you can commercialise it. Look at Facebook and myspace.

3/ Lets look back in time a little. Remember 2004-2005. Myspace was growing at 30-50% a month for an extended period. Engagement was growing too. It was considered that it would become almost a web replacement and marketing purposed web pages would be custom profiles. At the time it was beyond earth shattering and the so-called ‘future of media’ because most of us didn’t understand it. ‘Traditional’ media couldn’t stop covering it – CNN/Fox News/Comedy shows/SNL …  now look at it.

4/ Twitter is for older people. 12-24 yo’s only make up just under 20% of Twitter’s audience … compared to 23% of Facebook and 43% of Myspace. Is it a coincidence that over 60% of twitter users are over 35 … and most of the Twitter cheersquad (ie it’s going to change everything) are also over 35 or fast approaching?

Facebook/Myspace/Twitter – the numbers

fbmyspace

Data includes February 2009. From Nielsen Netview. Edit: I am measuring unique users. Continue reading

Twitter now officially next big thing

In the last week I’ve had about 50 people add me on Twitter – and surprisingly most of them are people in know IRL!!!11

And then Rove went and talked about it on Sunday, and the bloggers have been talking about it for the past 9 months … and then ad agency people and strategists start going on about it and the momentum becomes rather compelling.

Twitter is in 2009 what myspace was in 2004 and Facebook was in 2007 … a tool with strong momentum that most don’t immediately understand.

Me, I’ve been on Twitter since May of 2007. Back then I followed about 10 people (Dave Whittle, Andrew Pascoe, Cathy Edwards, some sketchy IT nerd types that ranted about PT and other rubbish) and I kind of didn’t see the wow.

2 years on I’m not sure I have anymore clarity. Still, the rush from the experts that it will change the world seems eerily familiar. I guess I’ve used it most days for the past 2 years so it must play some role in my life … mainly as an outlet for my inane observations or broadcasts about peak hour traffic or delayed planes.

If you look at myspace and facebook – both of these tools were going to change the game advertising wise and I’m not alone in saying that no one has really used either particularly well. Myspace relies heavily on straight display advertising and has dabbled in some interesting content areas. Facebook is similar but without the cool content creation.

I find it interesting there’s so much chatter about Twitter, when a service like Facebook has 5m+ AU users every month and seems much more commercial friendly if someone can crack a way of creating ads that are entertaining and relevant. Should we be looking closer at Facebook? Sure, it’s not the freshest thing but as a service it’s pretty essential for users right now.

Don’t get me wrong. I like Twitter – it’s interesting. It has real potential within search and its immediacy is appealing as a user. As a business it seems strong – low overheads, low operating cost, simplicity etc … it’s not a bloated startup cliche like a Digg or Slide … it’s lean and product focused.

Much like Evan Williams previous success, Blogger, which Google purchased.

I guess one thing we need to consider is twitter will probably ultimately need to look to an advertising model to ensure its longevity. And how will users respond to this? And how will it integrate brand messages – and will it be effective.

Right now there’s so much talk about Twitter being a fantastic CRM channel – however the examples used are few and far between (please don’t tell me about Zappos or Dell, find some new ones). Lets also not forget that Myspace was hailed as an amazing CRM channel (and still is for bands/entertainers, not so much for brands) and Facebook apps were wheeled out by most creatives in early 2008 as a great way of ‘connecting users to your brand’ and getting feedback etc.

It’s not enough for Twitter to build a loyal, large scale community. Why? There’s no shortage of these online anymore? They’re all over the place.

John Battelle is saying Google need to buy Twitter and maybe he is right.

http://battellemedia.com/archives/004832.php
“What’s the most important and quickly growing form of search on the web today? Real time, conversational search. And who’s the YouTube of real time search? Yep. Twitter. It’s an asset Google cannot afford to not own, and also, one they most likely do not have the ability (or brand permission) to build on their own. (Remember, Google tried to build its own YouTube – Google Video – and it failed to get traction. A service like Twitter is community driven, and Google has never been really great at that part of the media business). ”

This makes some sense as Google is amazing at monetising search and perhaps could make money from Twitter. It would need further investigation however.

How many high paying credit card advertisers would want to run next to this – http://search.twitter.com/search?q=credit+cards

Home loans – http://search.twitter.com/search?q=home+loans

Flights – http://search.twitter.com/search?q=flights

Insurance – http://search.twitter.com/search?q=insurance

Remember, a lot of Google’s revenue comes from products and services that are far from interesting to those who aren’t in market. Right now you’d be imagining Google would be thinking a lot harder than they were a few years ago about what this could add to the bottom line.

Maybe Twitters value is as an insights tool – becoming a supplier of data to commercial partners? Maybe. It has the advantage of being immediate … which is often the issue with data (ie it’s out of date before it’s even been published)

Who knows? Not me … but I think there needs to be a bit more thought around it.

Britney and Fox News Twitter hacks

Britney and FoxNews Twitter accounts have been hacked.

Valleywag covers it here – http://valleywag.gawker.com/5123624/twitter-hacking-epidemic-claims-britney-spears-barack-obama