Is Twitter Biting the Hand That Feeds It?

Earlier today Twitter's Director of Platform, Ryan Sarver, announced some significant changes to Twitter's Terms of Service.  These changes essentially shut down any service or solution that competes with Twitter in terms of acting as a consumer Twitter client.  Specifically, they are now placing significant constraints on any service providing "a Twitter-like end-user experience."

Sarver cites that the constraints come as a result of the need to create "a consistent user experience."  The announcement comes shortly after Sarver announced that Twitter was shutting off access to its whitelist for rate limits to developers.  Prior to this announcement, developers that wanted to get access to Twitter data could submit a request and get whitelisted, allowing them 20,000 requests per hour instead of the default 350.  This announcement a month ago was a shock to the developer community, and forced a number of developers to radically rethink their approach.  The announcement today comes as an even bigger shock, as it essentially shuts down numerous businesses that have been built on the Twitter ecosystem, and significantly hinders developers moving forward that are looking to Twitter as a potential platform.

The business reasons behind these moves by Twitter make sense: they are looking for a revenue model, and they are taking steps to proactively eliminate competition as they asses their next moves.  They insist that there is still significant opportunity for growth, which is true in many areas (including for us here at SocialToaster), but it cannot be overlooked that these sudden and unexpected changes to the fundamental foundation of the developer ecosystem significantly increase the risk for any organization looking to leverage Twitter as platform.

I would contend that Twitter is creating a significant problem with these drastic moves that create such instability for developers.  When real estate developers or businesses are exploring investment opportunites on foreign soil, they first look to the stability of the government and infrastructure before moving forward.  If there is a risk that the government could, at any time, arbitrarily seize corporate land or assets, developers think twice before investing.  I feel that the same holds true in deploying technology solutions that are built upon existing social media platforms.  If the underlying "government" behind the platform is shaky or inconsistent, then developers have no choice but to assess this as a risk factor, and many will end up making a decision to move to more stable ground.  Twitter has created a situation whereby platform developers have to question whether or not their investments will be turned upside-down at any point in the future.

This is a problem for Twitter.  If we look back on history and examine why Facebook eclipsed MySpace, what becomes evident (in my opinion) is that a key factor was the openess of the Facebook platform.  Facebook allowed developers access to its infrastructure and the ability to deploy solutions within its confines in a way that was not available under MySpace.  As a result, the developer community made Facebook a far more interesting place (think FarmVille and MafiaWars).  This attracted more people and made Facebook more popular.

Why has Twitter continued to grow even as Facebook and Google have expanded into the realm of real-time? I would argue that a primary reason is because Twitter has a massive development community that has made Twitter more accessible than other platforms. My concern is that by (a) cutting off a major portion of this community, and, more importantly (b) by creating fear about the stability of the platform, that the developer community will target other, less risky platforms such as Facebook for future growth, and that Twitter will lose momentum and become the next MySpace.

History has shown that consumers, if given a choice between a restrictive platform or open platform, regardless of underlying business rationale, will gravitate to the open platform. Consider AOL and their self-contained online portal versus ISPs providing open internet access.  Or, perhaps you recall DivX, which let you watch a movie for cheaper than a DVD, but only let you watch it a limited number of times. Twitter, by forcing consumers to use their products and restricting development in the space of an open economy where competitor platforms still allow for unrestricted alternative solutions, is creating a situation that might well mark the beginning of their downfall, even as they make these choices under the guise of growing their business.  It will be interesting to see how things unfold from here.