Twitter Is Doing Exactly What Fred Wilson Said

I have been so heads down on the Social Business Edge event (1pr 19, in NYC; being livestreamed at http://www.livestream.com/socialbusinessedge starting at 9:30am) that I hadn’t read the stories about Twitter’s Ev Williams announcing their own URL shortener in in the works.

They have a URL shortener working now, for direct messages, ostensibly as a way to track malicious sites and block them, so this isn’t that new on a technical basis. However, on a business basis it is more of what market watchers all have been guessing at, based on Fred Wilson’s post last week (see Twitter Raising The Infrastructure). He basically stated that URL shorteners were just filling a gap in Twitter’s core functionality.

That suggests that Twitter will try to develop the deep analytics that Bit.ly has built: it is a natural requirement for the media and corporate users of the microblogging service. However, as has been noted by John Borthwick, the CEO of Bit.ly, URL shorteners are not constrained just to the Twittersphere, and even in the Twittersphere on a small proportion of short URLs are generated by the Twitter webpage:

John Borthwick, Bit.ly and Platforms

Twitter.com pretty much stopped using bit.ly to shorten URL’s on Twitter.com in December.    Since last fall the bit.ly team and Twitter have been talking about this transition.    Today Twitter.com represents less than 1% of bit.ly links shortened — when the transition took place in December it was closer to 3-8%, depending on the UX on Twitter.com and the day.   We continue to work with the Twitter team and we are currently figuring out how to get key whitelabel URL’s working on Twitter.com.    The default shortening partnership worked well for a period of time – approximately six months — during a period of hyper growth. Today bit.ly is growing and continues to scale — irrespective of the change in rules last December re: shortening on Twitter.com.

Borthwick goes on to state that start-ups have to be careful about platforms, because although you need to build on them, they are fundamentally unstable and uncontrollable, like tectonic plates. He makes that case that start-ups need to diversify their reliance across multiple platforms. if possible.

John also takes a poke at Fred Wilson’s ‘filling holes’ argument:

Lastly, talk about holes and filling holes in platforms is misleading at best.    Take a list of emerging to mature companies — great companies … Is Groupon a hole in Facebook? Facebook a hole in Google?? Google is a hole in Microsoft???  Microsoft in IBM????  Maybe it’s holes all the way down?    Innovation — building great companies — is about finding, filling and even creating holes.   But entrepreneurs shouldn’t — and most don’t — focus on filling holes in other people’s platforms — they should think about how to build great things — things that in 2010 may be bootstrapped on platforms but great products, products that people love, products that move people to organize their world differently, or to see the world differently.   The slogan “Think different” captured most if not all of what entrepreneurs need.   After 30yrs of personal computing history we have a lot of platform and application history to draw from — Apple understands this very well, so does Google,  same for Microsoft, Amazon, and Ebay.  And yes — once again, the cycle of innovation is turning – great new platforms are emerging and great businesses will be developed on of these new platforms.

Instructive lessons to learn all around. To Twitter, the world may look like a bunch of holes, but Borthwick points out that Bit.ly, at least, is more than a hole to be filled.

[disclosure: I am an advisor to Bit.ly and have a financial interest in the company.]