Monday, March 15, 2010

Has Twitter reached its peak ?

I have written on this blog not so long ago that Twitter was working on some business plan. I was saying that it was actually a good sign that Twitter was starting to envision how they would make money out of their audience.

Now I have read this very interesting article. Indeed, it seems that since September 2009 Twitter accounts growth was flattening. Twitter and its use was starting to mature.

These results might seem some kind of disappointing, as they are far from the expectation, and moreover far from Facebook’s figures.

I believe actually that Twitter is a little bit late, and that they should have started to work on building revenues before this maturation. Indeed, Youtube was making revenues way before they reached their best scores. Twitter should have been able to generate revenues and still increase its number of accounts.

Now this may explain why Twitter is multiplying the projects on how to make money with Twitter. Its main issue is that it has already allowed some competitors to get into its own advertising market, either Google, which owns a powerful Tweet search engine, Seesmic which enable people to tweet from a computer or a mobile phone, among others.

Twitter's growth seems to have lost its momentum, according to a new study.
Growth in the micro-blogging service's number of users peaked at nearly 20% last April, but had dropped down to 0.15% in December 2009, says a study by Barracuda Networks.
Recent web analytics had already suggested that Twitter had reached its peak, as recorded a traffic high in July 2009 and has never reached that level since. According to Compete, Twitter reached 23.5 million users in August 2009 and stayed put. However, as Twitter client applications have grown and have become a bigger percentage of Twitter's user base, the numbers didn't necessarily reflect the actual situation of the micro-blogging service. By using the growth in Twitter users, instead of the site's traffic, the Barracuda study now puts things into perspective.
Strong growth in user numbers of 21.17% in April dropped to 10.95% in July and to 0.82% in September, and has ever been under 1% since – 0.58% in October, 0.34 in November and finally 0.15 in December. The accounts deleted by month also was growing, from 3.36% in April to 12.03% in October from which they peaked off to 8.48% and 8.14% percent in November and December.
To get these figures, Barracuda analysed more than 19 million Twitter accounts for frequency and content of tweets, user-to-user interactions, and each account's overall activity level. "We have been monitoring Twitter for more than one and a half years and keep track of the public timeline, and any new account of the public timeline," says lead researcher Nidhi Shah.
The concentrated growth of users reached its peak in April 2009, according to Barracuda
Barracuda's chief research officer, Paul Judge, explains the stagnation of Twitter with the end of "The Red Carpet Era". Twitter shows "a very concentrated growth spurt during the early part of 2009 – a period that we define as the 'Twitter Red Carpet Era'. Twitter users came online to follow their favorite celebrities. The most famous people have already joined Twitter, so I don't think they'll see another growth spurt like that," says Judge. From November 2008 to April 2009, several big celebrities, including Ashton Kutcher, Oprah Winfrey and John Mayer, joined Twitter.
In comparison, the number of Facebook users has been rising continously. According to Facebook, today 50% of the 400 million active users log on to Facebook in any given day, with more than 35 million users updating their status and more than 60 million status updates posted each day.
Another Twitter study published by US web analytics company RJMetrics last month seems to confirm Barracuda's report. It says that Twitter has 75 million users, an estimation that Barracuda roughly agrees upon, with a large percentage of accounts being inactive.
Another study by RJ Metrics says Twitter is still gaining new users, but has lost 20% of its growth since July
According to RJMetrics' data, about 80% of all Twitter users have tweeted fewer than 10 times, about 40% of accounts have never sent a single tweet, and 25% of accounts have no followers.
RJMetrics concludes that "the past six months have shown steady decline in the number of new account registrations", but the number of new users a month is currently at about 6.2 million. Their report doesn't say anything on the number of deleted accounts.
Twitter, which has not yet commented on the reports, recently announced that it had hit 50 million tweets a day. According to Barracuda's report, users are becoming more active on Twitter, with the most active users being those with about 1,000 followers.

According to internal documents leaked to TechCrunch, the company's forecast that it would go "from 25 million users at the end of 2009 to 1 billion in 2013".