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Summary:

Twitter is banking on its status as a “second screen” for TV content to drive a lot of the value it is promising as part of its public offering — but what if that value turns out to be a mirage?

Ever since Twitter filed the official documents for its initial public offering, there has been a spotlight on the company’s growth plans — and one big component of those plans revolves around being the “second screen” for TV shows, providing the kind of social experience (and ads) that networks are looking for. But what if shacking up with your television set isn’t the road to riches that Twitter and its investors are hoping for?

That’s the prospect that Travis Winkler of Hulu raised in a recent blog post, in which he argued that Twitter’s focus on a tight integration with the television industry limits the company’s potential valuation. Why? For the simple reason that the television world is in the process of being disrupted by a series of systemic forces, including time-shifting, downloading, streaming and fragmentation of the overall market. As he puts it:

“This type of TV consumption behavior eliminates Twitter’s value proposition to users and limits Twitter’s value to the networks. Very few, if any, viewers will engage in Twitter conversation about an episode they just watched that came out days, weeks, or months ago.”

Winkler is clearly riding a different horse in this particular race, since he is in charge of Hulu’s “TV Anywhere” program — but that doesn’t mean he isn’t right. We and others have been writing for the past several years about the rise of cord-cutting, particularly among the demographic groups that TV advertisers are most interested in, as well as the effect that streaming and downloading have been having on the single-screen experience. In effect, Twitter is trying to swim against this rising tide.

The company’s value proposition for television networks and content creators is that the social dialogue that occurs on Twitter while a show is being broadcast helps drive viewership levels higher, and it has repeatedly made that case to clients like NBC. But while that may work for special events like the Super Bowl or the Olympics, the number of TV shows that benefit from that phenomenon is arguably going to fall, not rise, as more people stream and time-shift and download.

That’s one big reason why Twitter’s focus — bordering on obsession — with TV may not turn out to be the recipe for riches that it believes it to be.

Post and thumbnail photos courtesy of Shutterstock / TravisK

  1. It is rather bizarre to suggest that people who don’t own a DVR are going to have a second screen for their TV.

    The real question to me is whether those twitter feeds at the bottom of some shows will help or hurt. They are clearly (free?) advertising, but do they get people to join twitter or realize how pointless it is?

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  2. Twitter’s real business probably is in capturing advertising moments – ‘SuperBowl’ moments. We did some analysis on the RoI – Advertising ROI: Twitter’s SuperBowl Moments

    http://statspotting.com/advertising-roi-twitter-vs-superbowl/

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  3. wow. this is so 2002.

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  4. sharona meushar Sunday, October 20, 2013

    while linear TV is still the strongest TV experience worldwide, twitter can definitely offer more than realtime TV buzz. Engagement and advertising monetization are key – and there are quite a few ways to use advertising tools even with catch-up TV, as well as float in context conversations. we at @applicaster offer a variety of features as part of our platform which do just that.

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  5. I can’t speak to the number of users that behave this way, though my friend group is 20+ and all of them have many more friends than I, and we frequently cross-pollinate each other’s interests in tv shows that are months to even years old. I’ve noticed, in particular, that when marathon or binge watching happens there will be a burst of chatter amongst friends as we relieve great moments or are drawn into things we had missed. I ended up watching the final season of a show I had long abandoned because a twitter friend was doing a rewatch up to the final season and it drew me back in.

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  6. Cut the cord 2 1/2 years ago. Kind if hard to tweet while watching Netflix on the tablet or via AppleTV. Though the Chromecast makes it possible, who would I be sharing the experience with live?

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  7. Stephen Grant Monday, October 21, 2013

    Also is a risky game for Twitter as it is relying on TV content to drive usage – broadcasters increasingly will not want to allow Twitter free rein in this space

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  8. A few month ago I wrote that my tablet is always in the room with me when ever I watch television, then I discovered, I missed half the show and a lot of the understanding; I don’t do that anymore. Its either the television show or the tablet never both at the same time…

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  9. Steve Wampler Monday, October 21, 2013

    Its really wonderful I like this post very much Thanx for sharing this

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  10. Plinkers (R. DROSNE) Monday, October 21, 2013

    Linear or unlinear, tweets can be anyway resynchronized in catch-up or VOD if it deserves to be.

    Sticking to TV market guarantee a big exposure of their brand and is the main use of it for now.

    In any case, the interest of twitter is very much bigger than simply audience engagement. The real killer app for brands and TV channels / Producers is in the big data. Following the “noise” made by twitter about this or that topic is the main issue that advertisers will get from twitter. Stock exchange and analyst already use this very much. Starting by TV, twitter is sure to have enough noise to analyze and get out something relevant from it.

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