Twitter's Bold Bet

 | Dec 12, 2013 | 11:50 AM EST  | Comments
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I recently criticized Twitter (TWTR) for missing the boat on messaging, the hottest trend in mobile today.

In the early days, for some inexplicable reason, Twitter's management team decided to downplay "direct messages" -- private one-to-one messages between connected Twitter users -- in favor of pushing all users to publicly display their tweets.

Into the vacuum left by Twitter stepped a bunch of messaging-only platforms. The biggest today are Tencent's WeChat, WhatsApp, Line, Kakao Talk and Kik. All these platforms have seen incredible growth in the past two years and, in some cases, now dwarf Twitter's user base.

WeChat and WhatsApp are both notably larger than Twitter, with more than 500 million and 375 million users compared with Twitter's 225 million.

In my previous column, I said that Twitter management could have capitalized on this trend if it had only allocated a dozen or so team members to build out direct messaging two years ago. Presumably, they thought this was a niche space that wouldn't grow. Also likely, they felt that they were going to be rewarded by Wall Street and customers for showing growth on public engagement metrics, whichever ones they think are important.

Ah yes, the importance of "focus" is what nearly killed BlackBerry (BBRY) when former CEO Thorsten Heins said it had no time to think about pushing BBM as a cross-platform messaging service and instead needed to focus on new phone models.

Twitter nearly missed the boat too -- until this week. It rolled out a new interface for Twitter mobile, which put direct messaging front and center. Management hasn't said much about it yet, but they obviously believe there's money to be made leveraging direct messaging. Maybe going public suddenly wakes up management teams into trying to make money any which way they can.

But this messaging trend is bigger than just another way to make money. Today, Facebook (FB) rolled out Instagram Direct as its version of Snapchat. Why spend $3 billion when you can just add a new feature? But seriously, Facebook wouldn't be calling attention to this new feature if management didn't know how big messaging is as a trend (and I would argue that Snapchat is just a smaller part of messaging compared to the other names mentioned above).

So, Twitter is going to try to do something here too. It's smart. I don't think it will slow down the momentum of the pure play names, but it's a smart move by Twitter, nonetheless.

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