Twitter, the Summize buy, and users on the rise
Just a few weeks ago I wrote about Summize, the hot Twitter search service of the moment, noting that “not only does it do a nice, clean job of providing search results, but it offers RSS feeds based on any search query.”
Obviously Twitter thinks highly of Summize as well, as speculation is percolating all over the interwebs that an acquisition is imminent.
I asked the following question on Twitter and FriendFeed last night, and received a bunch of interesting answers: Any gossip floating around on how much Twitter will pay for Summize?
Drew Olanoff’s official guess came in at $1.5 million, while Cains put it more in the $4-$6 million range.
To give the financial discussion some perspective, Twitter’s total funding has been something just over $20 million, while Summize has received $750,000 to date, according to TechCrunch. But more than the money itself, the real interest here is what Twitter will be getting and what it will mean for the future of the company/service.
Some other very interesting reactions on the FriendFeed thread:
* Peter Dawson: Why will twitter buy Summize ? If their replies tab is turn on, and a little bit of thought is given to scalability and arch, then they dont need to buy any other 3rd party add on. @ 4-6M, twitter can easily hire a bunch of coders to do the same thing and maybe even better.. it does not make sense from a technology buyout. However, Summize can be sold to some org that wants to track/trend chatter ITs the Ideal market research too built onto twitter !!
* Edwin Khodabakchian: I am not sure exactly how much twitter is going to pay for summize but to me the acquisition makes a lot of sense because I think that buzz analytics might be a great way for twitter to monetize it service and search is a core component of that. This is also a good way of bringing in engineering talent with zero integration risk. Seems like a good move to me.
* Jim Stewart: Twitter really needs Summize or something like it. Context sensitive ads. I bet they wish they had built it from scratch. Google really isn’t that far behind though (site:twitter.com searches) . It’s bot is maybe slightly slower in picking up Twitter posts that summize. The benefit Summize has over Google is that it has a Twitter like interface and a captured market…. mmm good topic for a show. They’ll probably both need revenue before Google buys them.
Meanwhile, Om Malik makes what looks to me to be the best case overall for Twitter wanting to gobble up Summize now. It boils down to Twitter’s eventual need to find a sustainable business model. The power of Summize search – including the ability to generate geotargetted results based on keywords and location within the “Twitter stream” – has the potential to serve contextually relevant advertising (see: Google AdSense). Malik writes:
In other words, Summize has come-up with a clever way of peering through Twitter’s vast data stream and finding out what’s hot, where and how. The results are essentially keywords – topic, person or location based – and thus can be used to show contextual advertising next to the pages that show these results. Summize, has thereby developed an ability to monetize conversations without being intrusive.
The timing of this deal is especially interesting because Twitter is in the precarious position of being widely criticized (and at times by yours truly) for not being able to keep its service stable over the last few months. With frustrations running high, some prominent bloggers are moving conversations over to FriendFeed, while others have been motivated to check out new start up/upstarts such as identi.ca and Plurk.
However, Mashable points out that Twitter’s demise has been greatly exaggerated, with Alexa, Google Trends, and Quantcast numbers all showing full and onward upper movement. Mark ‘Rizzn’ Hopkins notes, “Twitter doesn’t have much to fear, other than losing a certain type of user – the vocal, visible community leader. Twitter has a large enough ecosystem that these folks can leave to a site like FriendFeed and not have a measurable impact on the base as a whole. ”
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