Now that Twitter has launched an ad product and moved on plans to provide Twitter users “official” versions of services third-parties used to provide (photo-sharing, URL shortening and mobile apps), a whole lot of the startups built around Twitter are totally screwed.See which Twitter apps got screwed →
TwitPic lets you share photos on Twitter. It hosts them and gives them short URLs.
This is on the short list of functions Fred Wilson singled out for slaughter.
TwitPic is bootstrapped but profitable on over $2 million/year in revenue (half of which is profit!). If TwitPic gets crushed by Twitter, at least founder Noah Everett will have banked some cash for a rainy day.
Funding: $3.5 million
Bit.ly, a Betaworks company, is the leading URL shortener.
URL shorteners are also explicitly marked for death.
A source close to Bit.ly says Bit.ly has made significant progress diversifying off of Twitter and that only 30% to 40% of Bit.ly's clicks are now 'Twitter-related.' The rest are said to come from email, Facebook, Meebo, Foursquare, and other services. This diversity reduces Bit.ly's dependence on Twitter, but does not eliminate it.
Funding: $2.3 million
TweetDeck is a desktop client for Twitter (and Facebook, MySpace, etc.)
Twitter plans to redo its homepage in a way that makes you 'not want to use a desktop client'. That's hard to picture, and TweetDeck had better hope Twitter can't pull it off.
Like most Twitter apps, it's already sought to reduce its dependence on the Twitter platform by becoming a sort of 'social media dashboard,' so they've got a chance.
Ad.ly connects highly followed Twitterites with brands for in-stream advertising.
Advertising wasn't singled out for slaughter, but it was suspiciously absent from Fred's list of things third-party developers should be working on.
Ad.ly investor (and VC blogger extraordinaire) Mark Suster wrote that he's confident Ad.ly can survive because it's a 'multi-stream' ad network, not focused just on Twitter.
Funding: $27.3 million
OneRiot is a real time search engine. The good news: it searches more than just Twitter. The bad news: Fred seems to think search is the sort of thing third parties shouldn't be doing.
Funding: $12 million
Seesmic is a lot like TweetDeck. They've taken in a lot of funding, and like to emphasise that they offer more than just Twitter.
But they're sure hoping Twitter's homepage redesign is a flop.
It's worth noting that Seesmic started out as a user-generated video site, so this isn't the first time they've had to reinvent their business. We tend to like startups that can do 180's so we're curious to see what Seesmic comes up with next.
Twitterrific makes Twitter clients for all things Apple: Macs, iPhones, and the iPad.
Unfortunately for Twitterific, mobile clients are pretty much going to be superseded by Twitter's own apps.
yfrog lets Twitterers share pictures and video.
Sorry, yfrog, that doesn't get you off the hook.
yfrog is an Imageshack product so its death probably wouldn't affect their bottom line significantly. But they've been looking at Twitter as a source of growth, so it would be a bummer for them.
Funding: $1.9 million
Another desktop client, another entry on Twitter's list of companies to kill.
140 Proof places ads in Twitter streams on clients like HootSuite.
If Twitter successfully kills desktop and mobile clients, 140 Proof is screwed. If Twitter moves to take over advertising, 140 Proof is screwed. Drink up.
TwitVid is now called Vidly, and bills itself as 'the easiest way to share video on the web,' i.e. not just focused on Twitter. So hopefully they've dodged a bullet.
Bill Gross, already the inventor of search advertising as we know it through Overture, launched his Twitter advertising-slash-search engine company literally a day before Twitter announced its own ad business.
For now, TweetUp and Twitter's ad model are somewhat different: TweetUp uses a bid-driven marketplace and will be distributed throughout the web via search and rollover widgets; Twitter's ads, meanwhile, will initially be sponsored tweets that appear in search. But both are driven by keywords, and they could likely quickly become directly competitive.
Last week, Fred Wilson wrote a post on 'The Twitter Platform's Inflection Point,' encouraging Twitter developers to stop focusing on 'filling holes' in Twitter's platform, and to build new and bigger services on top of Twitter.
This was widely interpreted as 'a bombshell' on Twitter developers since, if most of the existing apps only 'fill holes' in Twitter's platform, it makes sense for Twitter to fill these holes itself. Then Twitter came out with its own BlackBerry app, and acquires atebits, the maker of Tweetie, the most popular Twitter app on iPhone, with plans to release it for free as 'Twitter for iPhone.' Last night, Twitter finally announced its own ad product, which in many way mimics previous efforts by third party developers.
(Meanwhile, Some Twitter developers started a super secret project to kill Twitter.)
So it seems that a lot of Twitter apps are going to get seriously affected by Twitter's new move. A lucky few will get bought; the rest will probably be superseded.
There are a few things to be said from Twitter's perspective here, though:
Before we get all weepy for these Twitter app-makers, a few things to be said from Twitter's perspective here
Fred is right that mobile apps, URL shortening, search, photo and video sharing, etc. are things that Twitter should have had from the start, or built quickly. As Chris Dixon pointed out, some version of this was inevitable and, to their credit, plenty of Twitter app makers tried to diversify away from the Twitter platform.
It's no coincedence that Twitter's top investors, Spark and Union Square Ventures, did not invest in any of these startups. They signaled with their investments what was going to happen a long time ago.
As Fred points out, vertical Twitter-based services such as StockTwits (finance) and Flixup (movies) have done well and are unlikely to be gobbled up by Twitter. Fred also points to social gaming, enterprise, discovery and analytics.
The twitterati love having jillions of twitter apps to choose from, but when Jane Normal wants to get that Twitter thing on her iPhone, she doesn't care, or want to know, about Tweetie, Twitteriffic, bit.ly or Tweetpic. She just wants to tweet and share links and pictures.
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