Twitter started on mobile, and that’s where the service is going. In the S-1 form that the company filed today for its public offering, Twitter called mobile the “primary driver of our business.” It said that 75 percent of its 218.3 million+ monthly active users are accessing the site from mobile devices — or 161.25 million users. And mobile accounts for 65 percent of all its ad revenues. In all, the word “mobile” comes up 130 times in the 160+ page document.
From the intro to the filing:
Mobile has become the primary driver of our business. Our mobile products are critical to the value we create for our users, and they enable our users to create, distribute and discover content in the moment and on-the-go. The 140 character constraint of a Tweet emanates from our origins as an SMS-based messaging system, and we leverage this simplicity to develop products that seamlessly bridge our user experience across all devices. In the three months ended June 30, 2013, 75% of our average MAUs accessed Twitter from a mobile device, including mobile phones and tablets, and over 65% of our advertising revenue was generated from mobile devices. We expect that the proportion of active users on, and advertising revenue generated from, mobile devices, will continue to grow in the near term.
If you recall, when Facebook filed its S-1 before going public, the company had no revenues in mobile and made a big point of spelling that out, with 425 million of its 845 million monthly active users accessing the service from mobile devices (those are from the initial S-1, which got revised up several times before the company finally listed).
Twitter is in a significantly different position. Not only does the company have a majority of its users accessing from mobile devices, but it already makes a majority of its ad revenues from these platforms. (The main ad unit currently on Android and iOS, Promoted Products, was introduced in February 2012.)
While there have been a lot of changes to the basic desktop product over the last couple of years, in 2013 you could argue that the biggest product moves that Twitter made have been in mobile, from the launch of the Vine video app (to follow through on the photo filters that it launched near the end of 2012) through to its experiments with Twitter Music (also a mobile app), and its acquisition of MoPub (a specialist in mobile ad-tech).
Twitter pretty much says it all about mobile and its ambitions to push the envelope in that area, in a bit of very typical S-1 jargon: “If new or enhanced products or services fail to engage users and advertisers, we may fail to attract or retain users or to generate sufficient revenue or operating profit to justify our investments, and our business and operating results could be adversely affected.”
With 130 mentions of mobile in the S-1, here are a few of the interesting points that jumped out at me during a first reading:
— The big threat in mobile for Twitter is in Asia. Specifically, it pinpoints the rise of multiple local messaging apps. “Increased competition from local websites, mobile applications and services that provide real-time communications, such as Sina Weibo in China, LINE in Japan and Kakao in South Korea, which have expanded and may continue to expand their geographic footprint,” it writes.
— Mobile can be misleading. “Our metrics are also affected by mobile applications that automatically contact our servers for regular updates with no user action involved, and this activity can cause our system to count the user associated with such a device as an active user on the day such contact occurs.”
— Mobile growth. The 75 percent MAU number is from the end of June 2013; a year before that it was 66 percent.
— Mobile and user engagement. Twitter makes its clearest statements in the filing about why it makes new products for mobile. “Our most engaged users are generally those who access Twitter via our mobile applications,” it notes. “In the three months ended June 30, 2013, a substantial majority of timeline views were on mobile devices, and the increase in timeline views was driven by mobile user engagement…we plan to continue to develop and improve our mobile applications to further drive user adoption.”
