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OVUM COMMENT: Twitter must focus on the mobile prize

Eden Zoller, Principal Analyst, Consumer, Telecoms, Ovum | Oct. 10, 2013
Twitter faces a particularly difficult balancing act with mobile advertising.

Twitter's IPO filing underscores the strategic importance of mobile for the company, and in Ovum's view mobile will be a key metric to watch once Twitter goes public. The filing revealed that over 75 percent of Twitter's 218 million users interact with the service via mobile and that over 65 percent of the company's advertising revenues are generated from mobile devices.

This is promising - Facebook went public with almost no mobile advertising revenues to speak of.  But Twitter will need to drive momentum behind mobile and this will be challenging as Facebook and every other serious social media and OTT player is now majoring on mobile.

Twitter faces a particularly difficult balancing act with mobile advertising. Mobile Advertising is problematic for social media at the best of times as it can be intrusive unless very carefully positioned, and in the context of Twitter's 140 character confines the danger of intrusive advertising is magnified. 

Another flashpoint for Twitter going forward is how to grow its user base and keep them engaged. To achieve this Twitter will need to show meaningful service innovation, in house or through acquisition. This will clearly have cost implications, which a concern is given that Twitter has yet to make a profit even if revenues are showing strong growth.

 

 

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