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Twitter Is Not a Media Company, CEO Says
“Twitter is not a media company,” Twitter CEO Dick Costolo declared on stage at AllThingsD‘s media conference in Laguna Nigel, CA, Monday evening. The statement was surprising given Twitter’s well-publicized role as a platform for breaking news, entertainment and other communications.
“You [even] sell advertising,” AllThingsD‘s Peter Kafka pointed out.
“We’re in the media business, but we’re not necessarily a media company,” Costolo elaborated. “We don’t create our own content; we’re a distributor of content and traffic. We’re one of the largest drivers of traffic to other media properties, [namely] to other online web properties, even to films.”
Costolo pointed to a Super8 campaign Paramount Pictures ran on Twitter last June. The studio promoted the hashtag #Super8Secret, through which it offered advanced screening tickets to the film. The film performed “50% better” during opening weekend than Paramount expected, Costolo said.
Kafka and Costolo went on to discuss the origins of Twitter’s advertising business. “When you came [to Twitter] in 2009, Twitter’s business model wasn’t clear,” Kafka recalled. “Now it’s solidly an ad business. Did you push the company in that direction?” he asked.
“I was certainly involved in it,” said Costolo. “The honest answer is that i was a key participant in it, certainly advocated for it. By no means was it my idea to create and launch the products we have now.”
Kafka asked Costolo if the company explored any other business models at the time, but Costolo evaded the question. “The notion that there were other ideas we considered and that I disposed of makes it sound too palace intrigue-y,” he complained. “It makes it sound a little too Hamlet. The reality of life is that it’s a lot more Tom Stoppard than Shakespeare,” he said.
Costolo likewise skirted questions about whether Twitter would have its first profitable year in 2012 — “We don’t discuss financials,” he said — but did stress the health of Twitter’s advertising business. In particular, he noted that engagement in several recent Promoted campaigns was above 50%, and that the cost per customer acquisition rate — by which we assume he means the cost per follower acquisition rate — is “fantastic.”
At the moment, Twitter is less interested in developing new products or revenue streams than growing the ones it’s already developed, Costolo suggested. “It’s all about scaling that now, launching these products globally,” he said.
