Twitter launches own photo-sharing service

Twitter is getting its own photo-sharing service, CEO Dick Costolo announced at the D9 conference today. It will roll out over the next few weeks to all users.

"We need to remove the friction from adding photos to Twitter," Costolo said.

In addition to making photo uploading easier for all users, this move is intended to harmonize content ownership: "Users will own their photos," he said, which may not be the case on other sharing services. Photobucket will host the photos on the back end, but Twitter will own the user interface and provide it to users through its site and apps.

Twitter photos won't compete with Facebook albums, Costolo said. "It's organized around conversations," he said -- what's happening now.

Videos are still hosted by third parties.

Improvements are also coming to Twitters' search engine: Results will become relevant and personalized, so different users may get different results depending on who's in their network. The search engine will also show photos and videos in the results page.

Twitter was originally a text-only messaging service, but that didn't stop users from sharing photos through new services like yFrog, Twitpic, and Instagram. The future of these services is now in doubt. To ensure a more consistent user experience (and control the revenue stream), Twitter is also putting the boot down on third-party clients for the service. It acquired Tweetie and re-released it as the official Twitter client on OS X. More recently, Twitter announced that it had acquired TweetDeck.

Users of Twitter send a billion tweets every six days, Costolo said. There are 13 billion API requests coming in to the company every single day. And, he said, more people use apps to access Twitter now than the company's Web site (250 million unique users a day).

In acquiring Twitter clients (Tweetie, Tweetdeck), Costolo says he means to encourage app developers to "move up the value chain." He points to an app the Red Cross is using, as well as influence-measuring app Klout, as examples of ways to add value to the Twitter ecosystem without confusing users as to what Twitter itself is providing.

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Costolo says that some photo-serving companies, like yFrog, are moving up the value chain already, adding features to the service that Twitter doesn't have.

In talking more generally about Twitter and the "social graph," Costolo said, "We think about the 'interest graph.'" What people are interested in is revealed in what and who they follow, but it's a different way of looking at a network than simply personal connections, especially since many Twitter relationships are asymmetrical: "I follow you but you don't follow me," he said.

"Are you a business?" interviewer Walt Mossberg asked.

"We are a remarkably successful business," Costolo shot back. Eighty percent of advertising customers return, and the "average engagement rate" on Twitter ads is dramatically better than other forms of consumer messaging. By way of example, Costolo said that a Volkwagen-promoted tweet had an average engagement rate of 52 percent. "More people engaged with it than didn't!" he emphasized. (Engagement includes clicking a link and retweeting.) Twitter provides an engagement dashboard to its advertisers; there are about 650 advertisers on Twitter right now.

"The beauty of Twitter is that people are flocking to it because it's shrinking their world." When you're doing that, Costolo said, with the profound economic and social implications, it's critical to get things right -- and not focus on optimizing for near-term revenue. Costolo also claims he's "not focused" on an upcoming Twitter IPO.