Impact of Twitter outages grows as stock traders go social
Now that tweets are running through Bloomberg financial terminals, Twitter has a greater responsibility to maintain uptime.
Twitter suffered its largest outage in some time Monday following an error in a "routine change" to the microblogging site.
In a statement, the company said the site was not available from 1:08 p.m. to 1:33 p.m. PT. A mere 25 minutes. For the 200 million Twitter users, that was a while, at least since the days of the regular "fail whale."
But now that Bloomberg terminals -- the computers that Wall Street analysts, financial types, and traders use -- have tweets flowing through them, there's a greater onus of responsibility for Twitter to maintain uptime.
A single tweet can ding the stock markets. We saw that earlier this year when a tweet purportedly from theclaiming there had been an explosion at the White House.
It wasn't true. It was a result of a hacked Twitter account by the Syrian Electronic Army, allegedly, and the account was quickly suspended.
What happened after was almost unprecedented. The stock market dipped, albeit momentarily, but it was still enough to wipe around $136 billion off the slate in just a couple of minutes. That was the result of a single tweet.
The fact is that despite this air of skepticism around Twitter, even now -- despite driving change during the Arab Spring, being a driving change in protests against censorship and law changes, and helping spread the word on breaking news events -- the microblogging site does have a significant impact on the world.
Not least the stock market. And when Twitter goes down, the world may carry on but its voice becomes significantly quieter. The argument is: "If analysts et al survived without Twitter, they can survive a few minutes during an outage."
Yes and no.
Bloomberg terminals feed stock and share information, but also real-time news information so that electronic traders can make decisions in a heartbeat. All for the hefty price of $24,000 per machine. One of the reasons for the sudden plunge in the Dow earlier this year following the fake AP tweet was due to automatic trading systems. They "saw" something and reacted.
"No human being believed the story," said Conifer Securities director of equity trading Rick Fier to Bloomberg in April.
And that's exactly why we need humans at terminals: to weed out the potentially misleading, erroneous, or plain false messages from the wires.
But the wires are now including Twitter. In fact, in many cases, Twitter is breaking news far faster than the news agencies. There have been reports that newswire staff have been told not to break news on Twitter, allowing them to get newswires to investors first.
Which, considering how much a company pays for a Bloomberg terminal, that's fair enough.
The tweets don't just include newswires republished on Twitter minutes after the fact. They also pull in other updates from "corporations, executives, government officials, economists, commentators, media outlets, and other voices that can influence the financial markets," the financial powerhouse said in a press release.
It's more to complement the news wire reports with a range of commentary that can help influence the financial markets. You don't just want to know the news -- you often want to know the after-effects, follow-up news, and general reaction. Sometimes that can sway the way a stock can go.
So when Twitter is down, Wall Street is working with one eye closed. Far from blind, it makes the job more difficult.
Twitter has as much of a responsibility to the people on the ground in rapidly politically-changing countries, to activists, reporters and ordinary users as they do with the financial market.
This article originally appeared on ZDNet under the headline "Twitter's outage stakes grow as stock traders lose social factor."