New York — With more than 60 million follower, Twitter distinctly is a flourishing social media platform, and until recently, it permitted third parties to use its APIs to build programs that drop ads into tweet streams. But, suddenly third-party ad networks have been officially banned from its micro-blogging platform, according to a post on the Twitter blog on Monday from Chief Operating Officer Dick Costolo.
Twitter’s move is aimed to protect its own advertising approach, “Promoted Tweets,” which it debuted several weeks ago.
Twitter calls it quality control; but critics claim that the new act hampers the market and consumer choice. Nevertheless, the decision could have dire implications for advertising start-ups that have built around Twitter out of business.
“Third party ad networks are not primarily concern to preserve the unique standing and user experience Twitter has created,” Costolo’s post read. “They may optimize for either market share or short-term revenue at the expense of the long-term health of the Twitter platform. For example, a third party ad network may seek to maximize ad impressions and click through rates even if it leads to a net decrease in Twitter use due to user dissatisfaction.”
Costolo added that the same consideration is curbing the company’s use of its own “Promoted Tweets” service. Hence, “It is essential that the core experience of real-time introductions and information is protected for the user and with an eye toward long-term success for all advertisers, users and the Twitter ecosystem,” he said.
“For this reason, “Apart from Promoted Tweets, we will not permit any third party to inject paid tweets into a timeline on any service that leverages the Twitter API,” Costolo, wrote in a blog post.
Twitter, he said, wants to monitor the effect of Promoted Tweets on the user experience rather than rolling out the service more aggressively. Consequently, “We are updating our Terms of Service to articulate clearly what we mean by this statement, and we encourage you to read the updated API Terms of Service to be released shortly.”
“This is an important development,” said Anil Batra, vice president of search and analytics Best Fit CRM Analysis – Learn which 3 CRM solutions would best fit your business. Click here. with Seattle-based POP, an agency that helps companies build online brand awareness. “It is mainly about Twitter’s need to make money. By keeping third parties from placing ads in the Twitter stream, they control the revenue, but they also control which messages get to individual users,” Batra said.
Twitter reiterated its decision about making an effort to become a profitable enterprise when it banned third parties from using the Twitter application programming interface to create programs that drop ads into Twitter conversation streams.
The decision stemmed just more than a month after Twitter launched its own advertising service, Promoted Tweets, which displays advertiser-backed tweets atop search results. The effort is the micro-blogging’s site’s foremost penetration into traditional online advertising, and started with several partners, including Best Buy, Bravo, Red Bull, Sony Pictures, Starbucks, and Virgin America.
“Twitter’s API is employed by tons of companies, and some of those have started to experiment and monetize the data. TweetUp is the most visible example, but there are several others,” said Greg Sterling, principal analyst at Sterling Market Intelligence. “What Twitter appears to be saying is that it is going to tightly control the placement of ads around the feed. No ads will be allowed — other than Promoted Tweets — to appear in the flow or ‘timeline’ of Twitter updates.”
This indicates that Twitter is not eliminating third-party ads altogether. But, Sterling noted that ads may appear in other places, on Twitter clients or sites that use the Twitter API.
When Twitter addressed tensed developers at its Chirp conference earlier this year, the company stated that they would not be eliminated out because it would be rolling out deeper and more advanced ways for third parties to tap into its system. In the blog post Monday, Twitter kept up this olive-branch mentality with regard to the “Annotations” metadata product that it announced at Chirp. “When Annotations ship, there are going to be many new business opportunities on the Twitter platform in addition to those currently available,” Costolo wrote. “We know that companies and entrepreneurs will create things with Annotations that we could not have imagined.”
“Twitter’s user population is so astronomic and diverse that there will be a range of opinions as to whether this development is good or bad,” Paul Verna, a senior analyst with eMarketer, said in a statement.
If Twitter becomes too cluttered with useless ads, people will leave the service, and Twitter will be done, Costolo added. “Still, it is safe to say that most users prefer an uninterrupted tweeting experience. For this reason, having Twitter stop the flow of ads in the tweet stream limits the number of intrusions on that experience, and hence might be perceived as a good idea.”
Finally, Batra stated that this arrangement should preserve Twitter’s value as a source of information for users, which in turn should increase its potential to generate profits for its owners.