Friday, November 26, 2010
BOB GARFIELD: I know one guy who would appreciate it. He is Twitter cofounder Evan Williams, who recently stepped down from the CEO post to resume a role in programming and product development. Evan, welcome to OTM.
EVAN WILLIAMS: My pleasure, thanks for having me. I'm a fan.
BOB GARFIELD: So, you know, I have friends who are real social media experts who insist that I tweet regularly. And [LAUGHS] I know we as a show tweet regularly because our development people tell us you gotta tweet! And we do have a lot of followers and we do try to foster a conversation. Tell me again what we're getting’ out of it.
EVAN WILLIAMS: [LAUGHS] Well, it depends. Everybody gets different things out of it. A common myth is to use Twitter you have to tweet and, in fact, for most people it’s just about tapping into these information sources. But for someone like yourself, it’s a way to keep your listeners and fans connected in between shows. You being in media and having the platform already, it’s probably less obvious that this is a real profound thing, but for other types of people and businesses it is actually a communication channel that they've never had before.
BOB GARFIELD: Now Evan, it will surprise you not at all that we tweeted to our followers that you would be on the show and, and solicited them for suggestions for questions. Here’s my favorite, quote, “Ask them why does Twitter’s infrastructure feel about as stable as a drunken idiot being fingerprinted on Cops?”
EVAN WILLIAMS: [LAUGHS]
BOB GARFIELD: Can you tell me what is involved in harnessing the bandwidth and the server capacity and the peaks and load, and so on, that keeps Twitter afloat, except when it isn't?
EVAN WILLIAMS: It’s obviously extremely complicated. We have 100 people and thousands of servers and other equipment dedicated to running Twitter and keeping the tweets flowing. Sometimes that breaks down. You know, it’s a, a high priority for us to keep it going but it’s never been done before, so we're still working out the kinks.
BOB GARFIELD: Complex and expensive, I gather, and yet virtually no revenue. To date you've been paying the bills with venture capital. But you have roughed out a business model. Tell me where the money’s going to come from, how the advertising will look. What’s going to pay for this killer app of all killer apps?
EVAN WILLIAMS: First, I'll tell you how we think about revenue and why we've taken a while to develop that part of the business. It’s simply because we think the long-term value of Twitter is going to be in building the largest, most valuable network possible. And so, all of our time over the last couple of years has gone into building the best technology and product we can. Earlier this year, we just started building the revenue-generating portions of the network, which is an advertising platform, and we wanted to do that in the way that was very organic to Twitter and didn't seem foreign or in any way clash with how people were using the product. And so, we have what we call promoted tweets and promoted trends. Basically we give companies the ability to give visibility to a topic, and when people click on it they see a tweet from that advertiser.
BOB GARFIELD: You mentioned your determination not to change the organic experience, but how do you make sure that the charm and the utility of Twitter doesn't become contaminated by pay-to-play because there isn't enough segregation between promoted and organic results?
EVAN WILLIAMS: Well, first of all, we only have one promoted tweet in any set of search results, and it’s clearly marked as promoted. But we also measure the engagement on the promoted tweet, and if people aren't either replying or re-tweeting or clicking on a link, we take that as a signal that it’s not very interesting, and then we'll stop showing it. For example, the other day The Washington Post bought a promoted tweet. They actually bought the trend “election,” which a lot of people were searching on, and that got about a nine percent engagement rate for people who saw it, which, to us that’s orders of magnitude higher than most advertising on the Web, and –
BOB GARFIELD: In fact, let me put that in perspective. The click-through rate on a display ad across the Internet is substantially less than one percent. And they're clicking through the links that take you to The Washington Post website, right?
EVAN WILLIAMS: They're engaging in some way on Twitter or going to the website, and it’s because that was relevant information for what they were searching for from a trusted source.
BOB GARFIELD: In a recent interview with my colleague Abby Klaassen of Ad Age, your successor, Dick Costolo, said that revenue growth is likely to be roughly equivalent to the growth curves of Google and Facebook. But, Evan, ad revenue isn't an entitlement. I mean, it has to make sense for marketers. Why are you so confident that just because Twitter is world-changing that there’s money to be made?
EVAN WILLIAMS: The nature of Twitter as an information network is extremely valuable for anyone who wants to get a message heard by lots of people, and obviously that’s what advertisers pay for. In many ways it’s more natural than other mediums on the Web because people are opting in to information, oftentimes commercial information. Dell Computer is one of the first big businesses to use Twitter and has reported selling millions of dollars’ worth of goods over Twitter. If that commercial value exists, then there’s no doubt that we can make that work better, both for businesses and for users, and our company can profit from that at the same time.
BOB GARFIELD: Twitter is an astonishing utility right this second. Do you have any sense that it isn't quite what it eventually will be, that there’s just one more element or one fewer that’s going to make the difference?
EVAN WILLIAMS: With 100 million tweets flowing through the system on a daily basis, there’s something for everyone, but the real challenge is finding the most valuable stuff for you. That may be an alert from a business about something you want to buy, it may be something from a friend, it may be something in the news, and finding that and doing that in real time is incredibly hard but that is where the real value’s going to come from. We really want to make Twitter the source of information that you check several times a day on your mobile phone. I think right now Twitter does that in the best cases, but we have a long way to go to make that really valuable.
BOB GARFIELD: All right. Evan, thank you so much.
EVAN WILLIAMS: Thank you.
BOB GARFIELD: Evan Williams is the cofounder and former CEO of Twitter.com.