Twitter Competition

In all the hoopla about Twitter’s continual clamp down on the use of its API (including by such people as Dalton Caldwell, Fred Wilson and I am sure many others) there has been much debate about ad supported vs paid services. There has also been some debate about developing competitive alternatives to Twitter, including Dalton Caldwell’s app.net and proposals to build upon existing open protocols (such as by Dave Winer).

My less than 2c contribution to this discussion is to wonder aloud about the market dynamics of ‘social media’/’user generated’ content sites. What is it about these ‘new media’ that seems to promote a ‘winner takes all’ dynamic. How many ‘twitter copycats’ are there? Yet ‘conventional media’ has many competitors… say mainstream daily print newspapers supported many competitors vying for ad dollars and customer dollars simultaneously. In this analogy I don’t see Facebook and Twitter as competitors… Twitter is like the daily news compared the the ‘weekly glossy’ of Facebook.

The relatively high switching cost (setting up accounts, finding people to follow and so on) compared to traditional media (buying a different newspaper, or flicking channels on a remote) seem to be pretty key to me. All of which brings an example that will be familiar to anyone with the slightest notion of Eric Ries and the Lean Startup ‘thing’ – and that example is IM. Eric often talks about his experience building on top of existing IM networks only to discover that his customers actually preferred to have multiple networks managed by an ‘all-in-one’ client.

Will we get such all-in-one clients? It is quite likely that these will be on Twitter’s hit-list in terms of any API crackdown. But without this, it would seem we will be limited to ‘one provider per media’. And replacing the incumbents is a lot bigger ask than simply providing a competitive alternative.