Oct. 4, 2013 at 6:43 PM ET
About a week after Twitter announced its intentions to raise $1 billion in the biggest tech IPO since Facebook in 2012, the San Francisco-based social network rolled out its first consumer-facing service that really, truly sets it apart from its No. 1 competitor.
Twitter Alert — which proved its worth on Thursday during the Capitol shooting in Washington, D.C. — activates during a crisis, sending mobile phones push notifications with urgent information from organizations like the American Red Cross, Department of Homeland Security and other emergency agencies, as well as from local police and fire departments (at least in some locations).
Unlike Facebook, with its involved and ungainly mobile app, Twitter is uniquely positioned to curate such important information. The 140-character message length is perfect for quick info updates. And whether you're in the media, law enforcement or just a casual Twitter user, you've long been conditioned to turn to Twitter — and not Facebook — the minute something big is going down anywhere in the world.
But certainly, you didn't think Twitter rolled out Alerts from the goodness of its heart, to reward us for our clever hashtag games, or for when Americans thought we'd bring democracy to the Middle East by turning our avatars green. Alas, Twitter isn't powered by our #BreakingBad spoilers (though its brand new partnership with TV ratings firm Nielsen might make you think otherwise).
No, Twitter, like Facebook, is looking to get paid. And in its march to the stock market, Twitter has been beefing up its business model behind the scenes as well, in ways that's making it seem more like Facebook than ever before.
The social network that doesn't insist on showing your real name, didn't sell ads until 2010, and once battled fiercely over privacy, is trying more than ever to prove it's got money-making potential. Gearing its business towards the growing mobile market, introducing "Promoted Products" and other ad-placement programs, launching both the Twitter #Music service and the Vine video clips, clearing out spam accounts and embracing its TV-centric audience are all part of the plan.
Twitter makes most of its revenue from what's called "native advertising" — subtle promotions designed to sneak right in the user experience so you hardly feel like you're getting sold to at all. Rather than an obnoxious flashing banner, or a side ad declaring something along the lines of "You won't believe blah blah blah," which users are learning to ignore, native ads fit right in your experience.
These can come in the form of a promoted trend, which appears at the top of the Trending list. They also show up in the form of a promoted tweet or account, both of which appear among the Twitter feeds you chose to follow. How much markets pay depends on how many clicks these placements generate, and where and when the posts are placed.
Facebook, which also deals in data analysis is still a far larger company than Twitter: Compared to Twitter's roughly 220 million monthly active users, Facebook's reportedly got 1.5 billion. Twitter generated $253 million in revenue the first six months of 2013, compared to Facebook's $3.3 billion. So on the money hunt, Twitter finds itself following in Facebook's footsteps, cashing in not just by advertising but selling user information as well.
Along with Twitter Alerts, launching the Nielsen Twitter TV Ratings is another big business move that's close to its users' hearts. Turns out, a TV show's ability to generate Twitter buzz is almost always disproportionate to its audience size. Consider the "Breaking Bad" series finale, which generated 1.24 million tweets from 10.3 million viewers. That's a lot of viewers for cable TV, but nothing compared to an average audience for, say, "Big Bang Theory," which gets around 18 million viewers, but not nearly as many tweets.
Advertisers hope that this new ratings system can help them figure out how to use this strange popularity indicator to make money, or perhaps to understand how to improve marketing of shows that are huge online but aren't drawing in as many masses. Facebook is following Twitter here, having only just begun offering TV viewing data to the marketplace. And Twitter still wins, because talking about TV is far more interactive on Twitter, where your conversations aren't confined to a single profile and a single posse of friends.
Who are you?
The most valuable user data requires a company to actually know who its users are, and that they actually exist. That's the real reason behind Facebook's real name policy — not the "transparency makes the Internet a better place" spin it shovels now. Twitter didn't worry much about real names during its early days, beyond some users pretending to be celebrities (hence, "verified" accounts). You can still have a Twitter account in the persona of your pet, or Christopher Walken, as long as you follow the fair-use rule of acknowledging satire or parody.
Fake accounts can make the the people or brands appear more popular that they actually are, however, which makes marketing data less reliable. What's more, fake spam-bot accounts that hit you up with advertising or try to get you to click on links lousy with malware have always been a problem. Either way, too many fake followers make Twitter less attractive to both marketers and users. And to that end, according to Twitter's initial filing, it's been cleaning house.
"We made an improvement in our spam detection capabilities in the second quarter of 2013 and suspended a large number of accounts," Twitter noted in its filing, adding that "spam accounts that we have identified are not included in the active user numbers presented."
This kind of clutter clearing actual improves the user experience. It's not the obnoxious behavior users abhor from Facebook — bouncing accounts made in your puppy's name, or closing up shop if your real name happens to be that of a real celebrity. Even the "native ads" aren't as obtrusive as those that show up in our Facebook feeds, at least not so far. Fingers crossed that the company's march towards money making doesn't turn into attempts to control user behavior, and generally annoy everyone who isn't online to advertise.