In a way, this year's South by Southwest Interactive conference is the third birthday of Twitter, which first became popular there in 2007. But users who attended a keynote interview on Monday with the site's chief executive, Evan Williams, evidently expected birthday presents of their own. After Williams failed to offer new details on how the company plans to generate revenue, attendees headed for the door early and tweeted their gripes.
Williams opened by noting that his announcement was "not an ad platform, it's an 'at' platform," by way of introducing @anywhere, a feature that will allow visitors on Web sites such as Amazon or YouTube to use Twitter's functionality without leaving the sites. It's a slick feature, but to a certain extent the audience members were justified in being unimpressed. Williams said prospective Internet entrepreneurs should ask themselves "Wouldn't it be awesome if…?" And one now gets the sense that Twitter is focusing too much on being awesome instead of addressing the more difficult questions about the future of its business.
“We haven’t implemented many revenue-generating parts of Twitter yet, because there’s a lot we could do that’s sort of low-hanging fruit, but it’s not necessarily scalable or sustainable.”
The most difficult of those questions have been about Twitter's plans to generate revenue. The company has said it will launch a "fascinating," "non-traditional" advertising business in the near future, but has disclosed little else. Although it struck deals with Google and Bing to allow those sites to incorporate tweets into their search results—deals that will yield millions for Twitter—it has resisted announcing a long-term business model.
Instead, the company has focused its energies on improving the service, which now has more than 75 million users. Williams said Monday afternoon in Austin: "We haven't implemented many revenue-generating parts of Twitter yet, because there's a lot we could do that's sort of low-hanging fruit, but it's not necessarily scalable or sustainable."
Twitter also has been slow to embrace the technology trend du jour: mobile apps that take advantage of a user's location, such as Loopt, Google Latitude, Gowalla, and Foursquare. Last year's SXSW brought the launch of Foursquare, an app that lets users see where their friends are and earn points for "checking in" at bars and restaurants. Today Foursquare has more than 500,000 users and is quickly moving into the mainstream.
While a new Twitter feature lets a user add his or her location to a tweet, location has not traditionally been central to the service. "We didn't start with location but are making serious inroads with it right now," Williams said in a tweet after the event. "It will be a major part of Twitter soon."
It may have to be. Facebook is expected to announce its own location feature at a developer conference next month. And if Twitter doesn't present a strong enough alternative, users may simply head for the door.
Nicholas Ciarelli is the former publisher of Think Secret, an Apple news Web site. He currently works on the product team at The Daily Beast.
