Here's Why Facebook's All Aflutter Over Twitter

Seems That the Tweet Is Replacing the Status Update Among the Digerati

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NEW YORK ( -- Did Twitter just make Facebook blink? If not, why did Facebook suddenly get so much more Twitter-like?

Indeed, mighty Facebook, steaming toward 120 million worldwide users, pulling away from MySpace and even nudging Google on its axis, started emulating key functions of Twitter earlier in March after a redesign made status updates central and immediate.

Last week Facebook moved further into Twitter territory by allowing users to open their profiles -- and status updates -- to the public, letting users to speak to people who follow them but whom they don't necessarily know. In other words, like Twitter.

But why would Facebook, quickly becoming the web's 800-pound gorilla, try to stop everyone's favorite little microblogger?

Perhaps because with the blizzard of media coverage over the past six months, not to mention high-profile celebrity users, it appears that the tweet is replacing the Facebook status update as the main form of life-casting among some of the 6 million Twitter faithful. "I know a lot of people who only update their Facebook status through Twitter," said Steve Rubel, senior VP at Edelman Digital.

Or, more likely, it's because of Twitter's massive growth. The site had 7 million unique visits in February, up 1,382% from a year ago, according to Nielsen NetView. But even that statistic is an underestimation of Twitter, as many users update via mobile or third-party software such as TweetDeck. Forty-two percent of the service's audience is between 35 and 49 years old.

Facebook clearly saw value in what Twitter founders Jack Dorsey, Biz Stone and Ev Williams had built, and made a $500 million offer for the microblogging service last summer.

While the subset of Facebook users now lingering on Twitter instead of their Facebook profiles is tiny, traffic to Twitter has exploded in the past six months. "It's apparent to me they have Twitter envy; because they didn't get Twitter, they are becoming more like Twitter," said Colton Perry, senior VP-technology at NetPlus Marketing.

Indeed, in some ways, Facebook one-ups Twitter by allowing responses beneath an update, facilitating conversation threads that can be more difficult to follow on Twitter. "Conversations have gotten much more linear and in-depth on Facebook," said Geoff Livingston, CEO of Livingston Communications. "But the real issue is that Twitter has never had a real competitor and now it does."

Feeling threatened
As a media property supported by advertising, Facebook has quite a bit to lose if a start-up or intermediary like Twitter stands between it and any significant portion of its user base. In February, Facebook claimed 6% of time spent online in the U.S., more than any other property, according to Compete. Any alternative or intermediary -- Twitter can be used as either -- threatens that engagement.

On the contrary, Twitter has no display-ad business to speak of, though last week it did start showing the equivalent of a house ad on the right side of the page that explained "twitter search," "widget" and other Twitter-relevant terms.

But aside from that, Twitter's ad business is nonexistent. At present, it's a messaging platform, not a media property. But if Facebook caps Twitter's growth or slows it down, it will make it that much harder for Twitter to resist Google, Yahoo or Microsoft if and when they come knocking.

Last week Sanford Bernstein analysts cautioned that monetizing the service "would be difficult at best and likely unsuccessful," and argued that a Twitter deal could end up destroying value on the scale of AOL's $4.2 billion acquisition of Netscape, and eBay's $4.1 billion acquisition of Skype.

Yet plenty of observers think that, regardless of what Facebook does, the two can coexist. While Twitter appeals to a subset of Facebook's audience, they're used for different purposes. Facebook users tend to connect to all their friends and family, while on Twitter, they only "follow" the interesting or useful ones, and dump the rest.

"I believe they are two different technologies," said Marita Scarfi, chief operating officer of Omnicom's Organic. "[Twitter] is about thoughtful pieces and opinions you want to put out, [Facebook] is about how or what you are doing today."

There's also a danger for Facebook in moving into Twitter territory. Facebook users consider their profiles private, and one of the bigger complaints about the new-look Facebook is that the pages deliver too much information.

"While there is a lot of overlap of audiences, they really are different groups," Mr. Rubel said. "A big reason for that is [Facebook] offers a level of privacy Twitter doesn't offer."

Just how many of Facebook's 100 million-odd users want their feeds hijacked by the Twitterati? "I would suggest some do and some don't," said Floyd Hayes, creative director of marketing firm Cunning.

As of last week, more than 800,000 Facebook users had weighed in on the new design, nearly all voting "thumbs down." A sample comment: "Frustrating to navigate. If I wanted Twitter I'd go there!"

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