Twitter, High-Tech Frienemies

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Twitter has become a fantastically popular Web site on the basis of the incredibly simple idea of letting people zip-out 140-character blog posts to anyone who wants to read their stuff.  Sure many of the comments are dreck. But Twitter has also become a kind of hopped-up, customized news feed.  Follow the right people and you can get a constant stream of links to the most interesting articles on the Web. Created only four years ago, Twitter has 105 million users and is delivering 55 million tweets, or messages per day.  It raised nearly $60 million in venture funding, becoming the Next Big Thing in Silicon Valley.  To date the company hasn’t done much to generate revenue, but that too nay be changing, as it announced a plan to start placing ads among tweets.

But the really cool thing about Twitter has been its business model. Instead of trying to do everything itself, the company threw open its doors and let other people build little applications that make it more useful.  More than 70,000 have been created so far.  Instead of going to its Website to post tweets, forrr example, you can use Twitter clients like TweetDeck, Twitterific, and Seesmic, written by outsiders.  That open approach seemed like techno-nirvana, a free playground where anyone could invent and contribute.

Well, nor anymore. Because just as Twitter was announcing its advertising scheme, the company also announced that it intends to scoop up the best apps and build them into Twitter itself.  That means it will now be competing some of its partners.  Twitter recently snapped up a company called Atebit, developer of Tweetie, a leading Twitter client on the iPhone.  In other cases it will just build its own version of what someone else has done. Either way it’s rough new for developers.

How do Twitter’s three cofounders explain the change? A spokewoman insisted everybody was too busy to comment because, oddly enough, the company was hosting a conference in San Francisco fo developers. What should have been a big lovefest instead turned into a massive anxiety attack. Onstage, Twitter CEO Evan Williams conceded there would be some “tension” between Twitter and its app developers going forward.

Twitter turns out to be just like every other venture-backed company, under pressure to deliver a payback to investors. To accomplish that, it may have to hurt some of its partners. Should anyone be surprised?


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