What is Twitter? What do people do with Twitter? includes an ifop survey about Twitter in France Why did Twitter grow so fast? What business model for Twitter? Who could challenge Twitter? What are the worse & best prospects for Twitter

1. @all studying the #Twitter phenomenon
December 2009

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..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 2

3. Comment this study
To comment the study, tag your messages with:
#Twitterstudy
To watch the live presentation, go to:
talk.fabernovel.com
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 3

4. Summary
• What is Twitter?
• What do people do with Twitter?
• Why did Twitter grow so fast?
• What business model for Twitter?
• Who could challenge Twitter?
• Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 4

5. Meet the tweet
A tweet is a text-based message up to 140 characters
automatically delivered to the author’s followers.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 5

6. You follow people
you your friend
Following someone means you get their tweets
as soon as they post them.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 6

7. And people follow you
a huge fan of yours
you
your friend
Your followers get your tweets in real-time :
you become a media.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 7

8. By default, everything is public on Twitter
Unlike Facebook, you usually don’t have to know
someone to have a full access to their tweets.
Twitter is a huge base of public data.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 8

9. Twitter interface : simple and elegant
What’s happening for you?
Write your tweet here
you
What’s happening for
your followers?
You can read that here
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 9

10. To define what Twitter is, let’s see what Twitter isn’t
Twitter is not a: Is Twitter a
blog The number of characters of a post is unlimited. One
tweet is limited to 140 prints. # Micro-blogging service?
Twitter is not a blog
sms You can send both a tweet an a SMS from your
mobile phone. But the tweet is posted on the Internet, and # Public SMS platform?
is public.
Twitter is not a SMS
social network In a social network, your profile is private.
In Twitter, everybody can follow you, you can follow # Public social network?
everybody, and your profile is public.
Twitter is not a social network
chat A chat conversation is private, a Twitter
conversation is public # Public chat?
Twitter is not a chat
Twitter is the SMS of internet era.
..…….
Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 10

11. Summary
• What is Twitter?
• What do people do with Twitter?
• Why did Twitter grow so fast?
• What business model for Twitter?
• Who could challenge Twitter?
• Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 11

12. Reputation: Twitter in France
Dear French Internet user, do you know...
Yes : 60%
Yes : 4%
Yes : 1%
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 12

13. Reputation: Twitter in France
Incredible growth !
%
%
%
%
%
%
%
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 13

14. Usages: Twitter in France
Percentage of Twitter members within our «aware
internet users» ?
9%
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 14

15. Reputation: Twitter in France
Who knows Twitter in France?
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 15

16. Usages: Twitter in France
Who is the French Twitter user ?
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 16

17. Usages: Twitter in France
What publication client/device do you use ?
30% 39%
Twitter.com PC / Mac
client
31%
Smartphone client
Source : Poll launched by L’Atelier ..…….
on twtpoll.com – november 2009
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 17

18. Usages: Twitter in France
Tweeting, yes, but for what ideal purposes ?
65% Creating and sharing a friend network
Having good deals & coupons
69%
40% Recruiting an employee
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 18

19. Usages: Twitter in France
Tweeting, yes, but for what real purposes ?
7% 2%
13%
8% 51%
14% 3%
Source : Poll launched by L’Atelier ..…….
on twtpoll.com – november 2009
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 19

20. Usages: Twitter in France
Useless? < Twitter < Useful?
63% 73%
French Internet users French Twitter members
..…….
Source : pour L’Atelier Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 20

21. Who tweets?
Individuals
Typical user I’m 31 years old, tech-savvy. And I do a lot of
things with my phone.
But 55% of users haven’t posted any tweet on their account!
Star Ashton Kutcher (aplusk) was the first Twitter account
to reach 1 M followers
And he chats with Demi Moore...
Blogger Pete Cashmore (mashable) has 1 M followers
Mashable is a famous blog about social media
Politician Nathalie Kosciusko-Morizet frequently uses
Twitter
Minister of Forward Planning, Assessment of Public Policies and
Development of the Digital Economy in the French government,
..…….
Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 21

22. Who tweets?
Companies & public institutions
Media CNN and the New York Times are among the first
20 most followed Twitter accounts.
But...Ashton Kutcher has more followers than CNN!
High-tech companies Google tweets to inform, Dell
tweets to sell.
Other companies The majority of Fortune 100 companies
don’t really get Twitter.
50% of the Twitter accounts of Fortune 100 companies have less than 500
followers
Public Insitutions The White House, l’Elysée
communicate via Twitter.
L’Elysée plans to tweet during Copenhagen Climate Conference
Twitter users’ are still a minority of tech-savvy people, companies and institutions
who have prominent communication needs
..…….
Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 22

23. What does the average user do with Twitter?
Follow and discuss news or Strategic Intelligence
• Users follow mainly people who have the same kind of
live events business
• 41% of URLs tweeted are news.
• A majority of users use Twitter as a news aggregator.
Gossip
• Asthon Kutcher, Britney Spears and Ellen DeGeneres Compared to other community-
are the 3 most followed Twitter accounts
driven websites (facebook,
MySpace, etc.)
Twitter is more business and
gossip oriented.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 23

24. What do bloggers do with Twitter?
They increase the ranking of They do “link journalism”
their blogs Bloggers use Twitter to analyze events in real time
Bloggers use Twitter to rapidly pinpoint interesting links
• Twitter has become one of the main sources of
traffic (eg : 10% of TechCrunch traffic ).
• Being on Twitter increases your Google ranking.
They carry on a continuous
relationship with their readers Twitter is a way, for bloggers,
•Followers get directly informed when a new post / a
new tweet is published. to explore new editorial areas,
mainly “link journalism” & real
time analysis
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 24

25. How do companies use Twitter?
They monitor in real-time They sell and market their
competitors, reputation and products
New sales channel (Dell)
improve business intelligence
New marketing channel (Pizza Hut)
To evaluate consumer
satisfaction and take into Twitter is an efficient marketing
account their feedback tool, both for companies and
•Crowd sourcing innovation to users (Zakos) customers:
•Conducting surveys on existing products (GM)
•Gathering feedback on experimental products (Dunkin good knowledge of customers
Donuts)
•Customer service (@MicrosoftHelps ) & free marketing opt-in channel
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 25

26. How do public institutions use Twitter?
Emergencies Police
Eg: @SF-311 for emergencies in SF Eg: West Midlands Police (UK)
Governments
Eg : Downing Street (UK)
Twitter is an efficient
communication and reporting
tool for public institutions
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 26

27. Who is the most followed on Twitter?
Ashton Kutcher
3.9M
CNN 2.8M
Barack Obama
2.7M
Dell Outlet
1.4M
TechCrunch
1.1M
Number of
Majority
followers of
accounts
< 50
Twitter is much more a one-way communication channel ..…….
than a social media network
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 27

28. Twitter usage is similar to wikipedia
90% of the content is 90% of the content is
produced by 15% of users produced by 10% of users
• More unidirectionnal than • A community lead by
peer to peer communication hyperactive users
• Few contributors, many • Few actual tweople
readers • The more followers you
have, the more you tweet
A typical power law distribution applies to Twitter content creation
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 28

29. Summary
• What is Twitter?
• What do people do with Twitter?
• Why did Twitter grow so fast?
• What business model for Twitter?
• Who could challenge Twitter?
• Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 29

30. What is the history of Twitter?
2006 2007 2008 2009
launch fame development success
Twitter raises $22M
Twitter won the “blog and opens its API, Twitter raises $35M
Twitter is publicly price” at SXSW developers create and has a growth of
launched. Interactive* Twitter applications. 1,300% in a year**
Twitter’s growth is amazing:
in 2009, Twitter is the fastest community driven growing-site.
..…….
* South by Southwest Interactive is one of the best festival in the world for creative technologies
** Feb 08- Feb 09 Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 30

31. Twitter benefited from the rise of mobile Internet
• The number of US mobile Internet users grew by 170% in two years*
• The rise of mobile Internet users was a tremendous accelerator for Twitter
• The 140-char format is adapted to mobile situations
• People were already used to SMS
• People can also tweet and be followed by using SMS.
..…….
* Feb 07- Feb 09 (Nielsen)
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 31

32. Thanks to an early adoption by celebrities and media,
Twitter reached a big audience rapidly
Celebrities
Most-followed accounts “ever” :
“Twitter star system” and verified accounts have spurred its adoption by a non-geeky audience
Media
• Media coverage on Twitter before
other major medias
• Ideal tool to cover live event in
real time
• difficult to censor
Twitter became THE real time news channel ..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 32

33. As a generic platform, Twitter’s growth has been
user-driven
API (opened in 2008)
developers
New uses: #, @, RT, etc.
New applications
users
New functions : RT, lists, etc.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 33

34. A strong community of developers
It is very difficult to compete with Twitter, because a new-comer has to create
a more powerful network than Twitter’s one.
..…….
Picture by Thenextweb.Com
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 34

35. What are the prospects for Twitter?
By the end of 2009 By the end of 2013
25 million users 1 billion users
Q3 2009 : $400 000 $1.54 billion in revenue,
Q4 2009 : $4 000 000 $111 million in net earnings
How?
Whereas Twitter grows very fast,
its business model remains unpredictable…
..…….
Source: TechCrunch, July 09 Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 35

36. Summary
• What is Twitter?
• What do people do with Twitter?
• Why did Twitter grow so fast?
• What business model for Twitter?
• Who could challenge Twitter?
• Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 36

37. Make the bird lay golden eggs: hypothesis for
Twitter’s business model
Market research
Companies pay to do market research on Couponing and/or SMS advertising
Twitter, Twitter selects the panels and • Ads and/or coupons to opt-in Twitter accounts.
analyses the results • Prospects selected by geolocation or by Twitter
Contextual ads (Google Adwords like)
Freemium Contextual ads on Twitter search and during
You have to pay to get “pro” access to Twitter tweeting
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 37

38. When should Twitter begin to monetize?
1) Now
Advantages Risks
Twitter has high and
Twitter would pay all
short-term financial
the testing costs to
expectations, Twitter
find the appropriate
should monetize fast
business model
to keep VC happy.
Twitter would acquire Twitter could engage
a real business in a wrong business
experience. model.
..…….
Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 38

39. When should Twitter begin to monetize?
2) Later
Advantages Risks
Twitter has such a big community, that it could start its monetization by testing various
business models at a small-scale.
..…….
Twitter Study • December 09 • faberNovel / Atelier BNP - Paribas • 39

40. Summary
What is Twitter?
What do people do with Twitter?
Why did Twitter grow so fast?
What business model for Twitter?
Who could challenge Twitter?
Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 40

41. ..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 41

42. facebook?
The ox that wants to be the frog
facebook is a giant compared to Twitter
350M users approx 20M users
facebook looks more and more like Twitter since the acquisition of friendfeed :
facebook wants to go public
+ = ?
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 42

43. facebook?
Twitter competes with facebook on contextual ads, real-time search and CRM
Personal activities Business purposes
Users are more reluctant to have ads on facebook 20M on Twitter.
than users
Tweets have a larger public than facebook updates’.
Private real-time information Public real-time information
More information is available on Twitter than on facebook, making
real-time search more accurate.
Unless facebook succeeds in becoming public, Twitter has a better position.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 43

44. ..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 44

45. Google?
Twitter & Google cooperate in the field of real time search
• Old news • Real time news
• Steady content • Dynamic content
• The web’s long term • The web’s short term
memory memory 20M users
• Page rank • Retweet rank ?
Need Twitter’s real time Need Google search
content technology & traffic
Need access to Twitter
firehose to rank tweets
In October 2009, they reached an agreement to include
Twitter content in Google search results ..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 45

46. Google?
pushes initiatives towards a fragmented real-time content market...
• Google Wave could become a universal real-time conversation
platform
• Google will index the whole real-time web thanks to PubSubHubbub, a real-
time protocol
• In December 2009 Google struck formal partnerships with Facebook,
mySpace and Twitter to index their live updates
=> The new version of the Google search engine, Caffeine, will emphasize
real-time search results including tweets, blog items, news articles and social
networking updates
...and a monopolistic real-time search market
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 46

47. ..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 47

48. Spam?
A threat for Twitter
Spammers use Twitter for two purposes :
Tweetomercials Cons
Though Twitter is making progress on blocking spam (they introduced a
“report spam” function on October), spam could reflect as badly on Twitter as
it reflected on Myspace.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 48

49. Other micro-blogging services ?
• open source, no character limitation.
• belongs to Google
=> Google didn’t build a large enough community to compete with
Twitter
•“Niche” market : enterprise microblogging
• Has a business model
• internal company information
=> Popular but doesn’t directly compete with Twitter
For the time being, no other micro blogging platform is in position to
compete with Twitter : Twitter rules them all!
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 49

50. Summary
• What is Twitter?
• What do people do with Twitter?
• Why did Twitter grow so fast?
• What business model for Twitter?
• Who could challenge Twitter?
• Conclusion
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 50

51. Worst case scenario:
Twitter may be asphyxiated by competition on all of its potential markets
Real-time Social Information Specialized
protocol Network analysis Business tool
New protocols may All social networks As real-time streams Companies duplicate
enable broadcasting foster real-time grow from various Twitter interface but
quicker, free and status broadcasting, sources, the real specialize efficiently
less proprietary real- and compete with business model may on vertical markets
time content Twitter on features belong to companies
and privacy able to filter the
information.
Eg : PubsHubbub Eg : Facebook as a Eg : Google Caffeine Eg : Yammer creates
protocol as a push- Twitter based on as a competitor on a B2B Twitter with
notification RSS may real-life social real-time search specific distribution,
offer real-time network features and
broadcast to all business model
By willing to maintain a wide-open “pulse of the world”, Twitter may be
overwhelmed by businesses grounded in reality
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 51

52. Best case scenario:
Twitter may become....
Real-time Social Information Specialized
protocol Network analysis Business tool
The most trusted The first mode of Robust platform for Ensure customer
source for real-time communication analyzing massive satisfaction and
data between individuals amounts of real time loyalty, while
data and behavior providing targeted,
Geolocation Friend geolocalized ads
Real time
Services updates
analytics CRM
Media Contact mgmt Human E-commerce
behavior
Celebrities Social Search Real time
Data
aggregation feedback
$$ $ $$ $$$
…a standard of real-time information, data, and communication
between individuals and businesses. Twitter can be the leading
communication platform for commerce and people.
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 52

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faberNovel, founded in 2003, specializes in designing and realizing innovative
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Based in Paris and San Francisco, faberNovel builds on emerging technologies,
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faberNovel’s team combines the necessary talents and passion to turn their clients’
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SFR, SNCF, Vinci, etc.
See our strategic studies on:
http://www.fabernovel.com/en/analyze/realisation/strategic-studies-and-surveys
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 53

54. Tracking and sharing innovation : since its beginning in 1978 in Paris, L’Atelier has
been helping executive committee in such fields as innovation and internet strategy.
L'Atelier teams have been actively involved in technology for years, acquiring solid
expertise and an impressive network of contacts. Strategic and operational insights
from L'Atelier experts have earned a reputation for both vision and provocative
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Francisco office in 2006 and one in Shanghai in 2007.
http://www.atelier.fr | http://www.atelier-us.com | http://asie.atelier.fr
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 54

55. 17, rue du fbg du Temple 75010 Paris 16 rue de Hanovre 75002 Paris
Tél. : +33 1 42 72 20 04 Tél. : +33 1 43 16 92 00
Fax. : +33 1 42 72 20 03 Fax. : +33 1 43 16 91 00
www.fabernovel.com http://www.atelier.fr/
Contact presse: Contact presse Rumeur Publique:
Sabrina Distinguin Thomas Boullonnois
sabrina.distinguin@fabernovel.com thomas@rumeurpublique.fr
..…….
Twitter Study • December 09 • faberNovel / L’Atelier de BNP - Paribas • 55