Twitter wants to be more than just the town square to Facebook's town.
But can it?
When Facebook went public in May 2012, it had 845 million monthly active users. Twitter (about a year younger than Facebook was at IPO time) has a bit less than a quarter the number of users: 215 million. Roughly half of Facebook's users visited the social network via mobile device. With Twitter it's 75 percent. The valuations are also dramatically different. Twitter will have approximately 13 percent of the annual revenue Facebook had when it went public. Facebook was touted as a $100 billion entity, and has grown past that market cap recently, and Twitter will be closer to $10 billion.
The data obviously shows that the two services operate on different scales. And it suggests that they appeal to users for different reasons.
Facebook is like a pulsing digital city, a vast community of virtual high-rise apartments and huts housing one in seven people on the planet. More than a billion Facebookers are curating and managing their online identities within the network, sharing trillions of pictures, links, likes, chats, and moments in their lives.
Twitter is more like a town square, where people, who might also live in Facebook, congregate to share the latest news, commentary, and gossip in real-time, shaped and condensed by the 140-character tweet limit. Both companies are on a mission to democratize communication. Twitter describes its mission as follows:
Twitter is a global platform for public self-expression and conversation in real time. By developing a fundamentally new way for people to create, distribute, and discover content, we have democratized content creation and distribution, enabling any voice to echo around the world instantly and unfiltered.
Facebook similarly casts itself as transforming public expression, content discovery, and sharing:
Our mission is to make the world more open and connected. People use Facebook to stay connected with their friends and family, to discover what is going on in the world around them, and to share and express what matters to them to the people they care about...We believe that we are at the forefront of enabling faster, easier, and richer communication between people and that Facebook has become an integral part of many of our users' daily lives.
Both Twitter and Facebook are defined by their news feeds and content "cards" that contain text, pictures, and videos. Whereas Facebook can be verbose and leisurely, Twitter is terse and more in the now. Whereas Facebook has status updates and likes, Twitter has tweets and retweets. The two social networks and messaging platforms aspire to the same goal and are gradually heading in each other's direction.
Twitter is building out more of a social graph with its Discovery feature, which algorithmically surfaces tweets from the people you follow and those they follow. Facebook has copied Twitter's hashtag convention and both have companion products for producing short videos: Twitter's Vine and Facebook's Instagram. They are chasing the same mobile ad revenues.
Twitter is defined by the tweet and differentiates itself from Facebook as more of a real-time medium.
Our platform allows users to browse through Tweets quickly and explore content more deeply through links, photos, media, and other applications that can be attached to each Tweet. As a result, when events happen in the world, whether planned, like sporting events and television shows, or unplanned, like natural disasters and political revolutions, the digital experience of those events happens in real time on Twitter. People can communicate with each other during these events as they occur, creating powerful shared experiences."
Facebook is more general purpose, requires an authentic identity and fancies itself as more of a social fabric for the entire Internet.
As a news source, Twitter is like CNN, TMZ, and ESPN rolled into one and curated by 100 million daily active users attempting to draft clever tweets. When big news breaks around world events, entertainment, and sports, Twitter is where the digital news junkies head. It's also a second screen for the major news outlets and events. For example,to deliver Promoted Tweets that include near-instant video replays, postgame highlights, analysis, news, and fantasy football advice.
But according to Pew Center research, only about 18 percent of U.S. adults on the Internet use Twitter, compared with nearly 70 percent for Facebook. The good news is that 30 percent of Internet users ages 18 to 29 currently use Twitter.
Twitter's executives understand that getting to Facebook scale is a stretch. In the last 12 months, ending June 30, 2013, Twitter has grown its base of users about 30 percent. The elder Facebook has grown its user base 24 percent since May 2012. Much of Twitter's growth has come internationally, with only 23 percent of the average monthly active users located in the U.S. for the three months ending June 30. And those U.S. users accounted for 75 percent of Twitter's advertising revenue during that period.
Twitter's biggest risk is that it won't continue to grow at a relatively rapid pace. In its S-1 filing, Twitter talks about the significant opportunity to expand its user base, especially in new and emerging markets. China presents a problem for both Facebook and Twitter as the incumbent social networks now have deep roots. On the product development front, Twitter says that it will "build and acquire new technologies to develop and improve our products and services and make our platform more valuable and accessible to people around the world."
With $1 billion in new working capital from the IPO, smart executives, and continued focus on giving more people reasons to join the Twitter revolution, the company will continue to grow. But it will remain more of a cable channel than a mainstream broadcast network until it figures out how to move beyond the town square and into the high-rises.