That slightly popular communication service Twitter has announced changes to their SMS policy.
The main one is that Twitter is no longer delivering outbound SMS over their UK number of +44 762 480 1423. You can still update via the number but updates won’t be sent on via SMS.
Now the reason for this given is that it was costing the company a fair chunk of money, so it’s scaling back the offer while it tries to negotiate deals with telecom companies across the globe.
And there’s two interesting points from this – the reaction and the business opportunity.
The reaction has been hilarious/disappointing (depending on how you view humanity) with users from all walks of life, including a Liberal Democrat local councillor, all bemoaning it as if they have lost a limb.
The reality is that they’ve lost nothing. if they want to receive ongoing, real-time Tweets, the solution is simple: go and pay for it. Pretty much what Twitter would have had to do, but that concept seems to have escaped the majority who appear to just want someone else to pay for their service.
(Nic Brisbourne has posted one of the more sensible viewpoints as a contrast to the rants. Another good one is here.)
The other point is that if I was a company offering a decent 3G dataplan and had the capacity to handle it, I’d announce a product with Twitter front and centre. Even the iPhone could jump into this (in the UK it comes with a decent 3G plan). Make the most of Twitter’s change in circumstances to promote your offering, knowing that with even a minimal PR spend, all the Twitter people moaning about this (and the evangelists I suppose) will spread your message.
Personally, I don’t see what the fuss is here. I’ve alread pointed out that I find Twitter useful for journalism and PR, it can be educational, and it can be just good fun to keep in touch with people. Having said that it does have downsides (which I’ll address in a later post) and far too many people still populate it with rubbish (“had coffee. Tasted coffee-y”) and if people want to keep getting a service that they have had for a while for free, well welcome to the real world.
(a part of me actually wonders if Twitter planned this all along. It’s almost the supply model of the drug dealer – give something away for free for a while and then bring in the costs. And given that some people out there are saying they would pay for the service, that poses an interesting question. Of course I think it’s ridiculous that people would pay to receive SMS messages, but each to their own…)
3 responses to “Twitter SMS Users Outrage, Twitter Using Drug Dealer Economic Model?”
I think one of the ongoing problems with the digital economy is that ever since the first bubble we’ve allowed ourselves to become accustomed to receiving free services from companies with, frankly, ludicrous or broken business models that couldn’t possibly sustain that free offering over the long term. As soon as one company giving away some valuable/expensive service goes (inevitably) bust another ones rolls up to fill the gap, until it almost seems we are entitled to getting free stuff, forever, from businesses that haven’t thought through their development cycle.
Hence outrage when a company comes along that has, deliberately and thoughtfully, manoeuvred itself into a position where it has market share, a network effect, a god service and can really get away with charging. The short history of the web has already been long enough to train us to expect our online services provided by VC-funded, pie-in-the-sky dotcom dreamers who hope to one day recoup their costs through advertising, and therefore to experience perfectly genuine outrage when we come across a real business that intends to at least meet the costs it incurs in providing us a service.
we’ve allowed ourselves to become accustomed to receiving free services from companies with, frankly, ludicrous or broken business models that couldn’t possibly sustain that free offering over the long term.
Interestingly – and being slightly glib – enough, the exception to this is the BBC. I know that technically it isn’t free, but most people see the news on their website as being a) free and b) decent enough that they don’t need other papers.
But, I’m now wondering…if enough Twitter users said they would pay for their service to their phone, is there a possibility that news outlets could charge for similar? The web being the ‘free’ service but (for those without 3G or wifi phones) SMS updates being paid for?
Probably not as the economic model for the press is still all wrong (but that’s another argument) but it’s a thought….
Twitter has an API which has allowed many 3rd party applications to spring up since its release. Twitter has benefited and perhaps in a few cases been hobbled as to how it will make money from the API (for example it could never plaster the site in adverts for example as people would just switch to an add free client app).
Within hours of the announcement about SMS there were about 5 people working on alternative services, myself included (we came up with http://www.hootsms.com and raced to open for business).
This is an interesting development, where a service gives away content for free, especially when there doesn;t seem to be any alternative way to monetise.