Why Twitter Turned Down Facebook
Why Twitter Turned Down Facebook By Claire Cain Miller
For now, a marriage between Twitter and Facebook is not meant to be — but the courtship between the two Web 2.0 companies could be rekindled in the future. That was one message from Evan Williams, the chief executive and co-founder of Twitter, in a talk at the Churchill Club in San Francisco Tuesday night.
Evan Williams. (Credit: Sara Morishige Williams)
Serious talks between the Facebook social network and the Twitter microblogging service started soon after Mr. Williams took over as chief executive on Oct. 16. Twitter reportedly rejected Facebook’s $500 million, mostly stock offer several weeks ago.
“We explored it, as we should. We took it seriously,” Mr. Williams said. “It definitely made sense — the strategy we talked about with them — but it wasn’t the right time.” Ultimately, he said, Twitter decided that it had too much left to do, beginning with figuring out how to make money.
“Maybe we’ll see each other in the marketplace,” Mr. Williams said.
Twitter, which lets users broadcast messages of up to 140 characters via cell phone or the Web, began to take off in March 2007. Until this fall, though, it struggled with technical difficulties and frequent service failures. It now has some 6 million registered users, though the number who use it regularly is much smaller. (One of them — perhaps Twitter’s most extreme user — was at the speech. He said he follows 17,800 people and 6,000 people follow him. “Do you do anything else?” asked Mr. Williams, who said he can barely keep up with the 947 people he follows.)
Twitter has raised $20 million from venture capitalists, but has brought in virtually no revenue, choosing growth over everything else. Indeed, Mr. Williams said he had planned to raise more capital in mid-2009 and wait to worry about revenue until 2010.
The recession changed that strategy, Mr. Williams said. “I don’t want to have to raise money in 2009.” Revenue is now a priority for the first quarter of next year.
Mr. Williams said that Twitter gets daily calls from companies who want to pay for sponsorships, but it plans to avoid making money from ads. Instead, it will figure out a way to charge businesses who use Twitter to talk with customers or sell products. Companies like JetBlue Airways, Dell and Whole Foods Market have used Twitter in these ways.
So far, though, “we haven’t studied the business cases much,” he said. “We literally have no business people in the company, so this isn’t an area we’re really focused on.”
Throughout the talk, he mentioned several big projects that Twitter plans to tackle but hasn’t yet. One is moving its search function, which is hard to find, to the home page. Twitter also wants to make it easier for users to find their friends on the service, filter the people they follow and form groups so they can control which messages reach which of their followers.
Twitter has been so slow in taking on this “low-hanging fruit,” he said, “that it’s amazing anyone uses Twitter today.”
Still, he said, he has grand plans for the company. Mr. Williams founded Pyra Labs, which created Blogger, a decade ago, and sold it to Google in 2003. “I worked on Blogger for six years and I don’t think it’s nearly as big as Twitter. Twitter will dwarf that,” he said.
The start-up’s biggest threat, he said, “is people who now see the concept …and say, ‘Oh, we can do that better.’ They could kick our butt.”
The idea that a big company such as Microsoft or Yahoo will start a microblogging service clearly keeps Mr. Williams up at night. “I’m pretty sure they all are about to launch something like this,” he said.
A decade ago, Blogger was one of the first services that allowed anyone on the Internet to immediately publish his or her own content. It forever changed the face of media (witness the blog you are currently reading) and the way people communicate. Twitter is an extension of that transformation, Mr. Williams said.
“I was surprised by blogging. It took me a while to realize the profundity of blogging,” he said.
He is not surprised, though, that Twitter is being used in newsgathering, as it was during the terror attacks in India last week. “I’ve actually been waiting for it to happen,” he said. The day Barack Obama was elected president was Twitter’s most-trafficked day ever.
Twitter will complement other forms of media, he said, the way that blogs and newspapers co-exist. “New media never kill old media,” he said. “It’s all part of an ecosystem.”
Mr. Williams emphasized many times that, despite its buzz, Twitter is still a tiny, two-year-old company with just 25 employees. “It’s good that the expectations are high, but give us a minute,” he joked.