By Spitz (@SpitzStrategy)

Geeking-Out on Social Media

Ever since Jack Dorsey and his podcasting company Odeo brainstormed and launched Twitter on a whim back in the summer of 2006, the SMS platform has been the favorite of geeks, programmers, and early social media adopters. Gorgeous in simplicity, fugly in UX, you could use it for anything, plug it into whatever you liked, and effortlessly tap into the opinions, pointless chatter, self-absorbed nonsense, and endless spam of millions.

Central to the success and fondness for Twitter has been its “open API” structure, enabling an application programming interface that allows developers to freely access and repurpose in any way they see fit all the streaming and archived data within the Twitterverse. The relationship has been reciprocal; in exchange for that unhindered access Twitter got some of the best programming know-how and third-party apps out there.

That symbiosis between Twitter, developers, and end-users has characterized one of the most successful communication experiments in human history. For the first time and on an unprecedented scale users themselves have created a digital channel’s structure, syntax, and extensibility. Even conventions such as @reply and #hashtag originated with outsiders through this delightfully self-referential social media dance.

“Show Me the Money!”

As the platform has grown from a few hundred thousand tweets per quarter to hundreds of millions per day, Dorsey & Co. has been under intense pressure to bring home some bacon. Frequent outages and server crashes plagued the platform that needed expensive upgrades, while the upside of tapping into such an incredible volume of traffic has always been tantalizing. Sooner or later the business model would have to change, but what would they do?

All social media networks have this problem in common, one I call the Social Media Paradox: “Engagement and monetization remain inversely proportional.” A corollary of that is “SM networks owe their astronomical growth to being free, so how do they start charging without losing participation?” Traffic on these social networks is off the charts, but none of them are making much money, q.v. the recent Facebook IPO disaster.

Far as investors are concerned, it all boils down to answering the obvious but surprisingly elusive question: “How much is Twitter actually worth?” Nobody knows. If they say they do, they’re lying. Besides, how do you quantify tweeting to save lives, recruit for a protest, or foment revolution? All #socialgood aside, the monetization tipping point has finally been reached, but sadly their solutions fly right in the face of what’s made Twitter great.

Battle for the Soul of Twitter

The first sign of trouble came recently when Twitter severed ties with LinkedIn. I used to love my tweets and those of my professional peers being pumped in, a way our profiles transformed from static lines of text to active, real time experiences. The move struck me as an obvious way to control content, but one that ran drastically counter to the spirit of social media, one that embodies sharing and connectivity. So WTF happened to Twitter?

C-Suite soul searching and water cooler fist fights are what happened, no doubt. On the one side you have Dorsey and his co-founders defending the innocence of a whimsical idea that has somehow changed the world; on the other you have CEO Dick Costolo and his minions who want to not only help this quirky and now gigantic SMS experiment survive, but flourish. Few doubt that Twitter needs to monetize: The argument centers around how.

I always thought they would acquire a freemium model, analogous to the network they abandoned, LinkedIn. Free to most users, yet fueled by data mining, contextual ads, back-end services for businesses including metrics, and subscribers who’d receive special treatment. After all, I thought that’s why Twitter bought Tweetdeck last summer, to rip the patents and create a truly compelling interface as a way to increase their value proposition.

Biting the Programmers that Feed Them

Instead, Twitter just announced a complex, confusing, and developer-alienating system that restricts their once-open, always cherished but now apparently taken for granted API. The new rules change the playing field for third party developers, establish caps on number of users, and shift guidelines to requirements across four categories of businesses that Danny Sullivan of Search Engine Land humorously characterized in Star Trek terms.

Irrespective of the details, the result is alienation of the developer community that helped build, grow, and support Twitter. As astute bloggers have already observed, these new API restrictions will curtail growth of these third-party apps, and discourage new developers and businesses from entering the space. What was once a dynamic, innovative, and diverse Twitter ecosystem will now be increasingly and likely entirely controlled by the Mothership.

Up against the put-up or shut-up wall, Twitter had to decide how it was going to start making money. Rather than risk disrupting the end-user with a subscription-based model, or find other creative ways, it chose to lock down how tweets are viewed on desktops, tablets, and mobile devices. The result will be consistent, controlled channels through which to embed paid advertising. Was it worth it? Will it work? Only time will tell, and soon.

An Unhealthy Solution

Until now, Twitter has been a darling for healthcare communicators, the new rules potentially souring these relationships, too. Although open-domain and therefore inherently problematic for health-related tweets that otherwise demand more privacy, Twitter has proven itself time and again in everything from emergency response to HCP peer-to-peer to patient education and empowerment. All that can and will continue, but developers be damned.

If Twitter’s goal is to control how end-users see tweets, then like it or not, effective or not, contextual advertising will be the norm for patients, caregivers, healthcare professionals, and institutions such as hospitals and payers. Worse still, developers might not be able to create‚îor will be limited in terms of how they create‚îcompelling aggregator tools such as our own HealthTweeder, and engaging communities such as The Diabetes Nest.

So what does all this mean for digital health? The bad news is that Twitter has finally “grown up,” but in a way that sacrifices openness and accessibility for content lockdown and forced advertising. The worse news is that few if any third-party developers will lend their innovation and creativity to this vibrant channel, limiting the potential for health benefits and #socialgood we’ve come to expect from the world’s biggest and brightest SMS engine.

What do you think? Is Spitz over-reacting, or do these API restrictions truly represent a disappointing milestone in the monetization of social media?

Michael Spitz , known most often as just "Spitz," is Editor-in-Chief of the Pixels & Pills and a prollific tweeter, blogger, and article writer, active in digital health across all specialties. Follow him @SpitzStrategy.



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  1. Mighty Casey says:

    Developing a revenue stream in social will always present a struggle for the soul of the platform. This is why LinkedIn is still the only real #sm success, since their 100%-business focus meant their audience understood how business works: you gotta show ’em the money.

    IMO they should at least explore the subscription idea (i.e. LI Premium accounts), but they went the ad/sponsored-tweets route and found that sp*m don’t sell as well as steak. Quel surprise.

    Locking up their API is going to be a disaster for their revenue-seeking goals. I predict they back off that approach by 1Q ’13.

  2. Andrew Spong says:

    Twitter has been clearly signalling the fact that it intends to reel back in much of the line it has paid out to developers for more than 18 months, so this hardly comes as a surprise.

    Building a business around someone else’s technology has never been a good idea.

    Whether Twitter has the ability to fill the creative void that the severed connections with third parties will create is another matter.

    It has looked woefully lacking in this regard pretty much since day 1, and has made little effort to support the plethora of opportunities that have emerged around health conversations on the Social Web, to name a single vertical.

    I see no evidence of Twitter ambassadors and thought leaders in the social health space, for example, helping to turn ideas into outcomes.

    Quite why this should be so bemuses me.

    Shouldn’t the home of conversation on the Social Web be a little more interested in creating and engaging in dialogue in key industries with its thought leaders?

  3. Spitz says:

    What healthcare entrepreneurs, activists, and thought leaders do with an open API is one thing, while being denied access to billions of tweets for the sole sake of monetization is another.

    I agree that the Social Web has been underutilized by social health, but that begs the question of what these restrictions mean not only for social health and Twitter, but social media as an open, innovative, and viable channel altogether.

    To me these restrictions are not only ultimately counterproductive to Twitters monetization goals, but run counter to what digital communications and third-party development has been about since that first website at CERN:

    Rather than solve a business problem through increased transparency and destruction of arbitrary virtual boundaries, obstacles are placed to open data and a seamlessly connected Web.

    Finally, I find your reaction surprising and extremely interesting, Andrew: You of all people recognized and embraced the power of Twitter since inception, yet now dismiss these seismic changes as irrelevant in the face of… what? Lack of creative tweeting in the health space?

    Digital Health is nothing if not brimming with potential. Nothing good and plenty of bad will come when we undercut that possibility in a foundational way. We need to ask not what has been done, but what can be done? And now that these changes are creeping in, what can no longer be done in the social health space?

  4. Dan Munro says:

    Balanced piece – and I agree with the challenges ahead. Unfortunately, like so much of healthcare, the (big) monetary interests lie elsewhere. I had a sense of that when Biz Stone presented at HIMSS earlier this year. Aside from being disappointing generally – it was clear that he had little interest (or knowledge) of twitters use in healthcare. In the course of a rambling and self-centered speech – he didn’t (by my count) use the word healthcare once. It was as if 8,000 people had come to sit at the fountain of twitter – only to be completely ignored. There was a desperate attempt to shift the focus at the end (by HIMSS Chairwomen – Charlene Underwood) – but trying to ad-hoc a Q&A session with 8,000 people – and no mikes – was fairly pointless. At that point – everyone started heading for the exits – myself included.

    The money’s there (for twitter) – but unlike Instagram – they may have a harder time trying to convert thier value at a price everybody expected. Instagram, Groupon, Facebook – are no longer the big mysterious valuations that helped to fuel their exponential growth.

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