Twitter attracts networks, advertisers ahead of IPO
As Twitter prepares for its initial public offering, the company is working hard to insert itself into the TV advertising economy and has forged partnerships with CBS, MTV and the NFL.
The Associated Press
NEW YORK — People don’t just watch TV anymore; they talk about it on Twitter.
From the comfort of couches, they share reactions to touchdowns and nail-biting season finales — and advertisers and networks are taking note.
Examples of Twitter’s influence abound. The recent finale of “Breaking Bad” generated a record 1.24 million tweets.
The conversation peaked at 22,373 tweets per minute, according to analytics firm SocialGuide. People used the hashtag “GoodbyeBreakingBad” nearly 500,000 times.
During this year’s Super Bowl, sports fans generated 24 million tweets about the competition and nearly half of the game’s nationally televised commercials contained hashtags that encouraged viewers to tweet.
Twitter, says Debra Aho Williamson, an analyst at research firm eMarketer, “creates a community, a bond between people that doesn’t really exist without Twitter.”
As Twitter prepares for its initial public offering, the San Francisco-based company is also working hard to insert itself into the TV advertising economy. In recent months, the social-networking company has forged partnerships with television-content owners such as CBS, MTV and the NFL through a program it calls Amplify.
The platform lets content owners beam real-time video clips to Twitter users who may have seen — or could be interested in — their TV programming.
It also allows marketers to communicate with viewers who saw their TV ads, extending commercial pitches to consumers’ smartphones and tablets.
TV tie-ins allow Twitter to diversify its revenue stream beyond the relatively small niche of digital-advertising campaigns, a move that should appeal to potential investors.
On Thursday, Twitter unsealed documents for a Wall Street debut that could take place before Thanksgiving. While the company did not reveal how much money it makes from its TV partnerships, it touted its own “strength as a second screen for television programming.”
Twitter wrote in its S-1 filing with the Securities and Exchange Commission that “45% of television ads shown during the Super Bowl used a hashtag to invite viewers to engage in conversation about those television ads on Twitter.”
Twitter’s public nature makes it an especially attractive platform for tracking live-TV conversations. So much so that Nielsen recently began using Twitter’s data to measure online social activity around TV programming, starting with this fall’s TV season.
Nielsen will release its first “Nielsen Twitter TV Ratings” report on Monday.
The study measures TV-related conversations on the social network.
Nielsen found that in the second quarter of this year, 19 million people wrote 263 million tweets about live TV events, up 38 percent from a year earlier. Some 19 million people tweet about TV shows, a 24 percent increase from last year.
The audience-measurement firm also found that many read tweets about TV shows while they watch them — even if they don’t post anything themselves.
As a result, Nielsen says the Twitter TV audience for an average episode is 50 times larger than the number of people who are tweeting about a show.
Separately, Nielsen found that the “Breaking Bad” finale was by far the most tweeted-about program last week.
Twitter’s projected 2013 revenue is about $582 million, according to research firm eMarketer.
At the moment, the company generates tens of millions of dollars of revenue from all of its TV deals, including those with ESPN, Turner networks, CBS and others, according to Brian Wieser, an analyst with Pivotal Research Group.
That’s not huge. However, says Wieser: “This year, it’s about getting the foot in the door.”
Wedbush Securities analyst Michael Pachter estimates that Twitter gets just a small fraction of its revenue from the TV deals — around 1 percent.
But by next year, the deals could amount to 5 percent, and 15 percent the year after, he says.