Twitter Breaks Up with DataSift

The “Firehose” is the moniker given to the stream of half a billion tweets that go out daily on the Twitter platform. Access to the Firehose is extremely tightknit – with reports of only a handful of companies granted access to the real-time data. And on Friday, April 10, Twitter severed ties with DataSift, one of its longest formed business relationships, and announced a plan to bring all data-licensing in-house.

The Breakup

The move away from DataSift began last May when Twitter purchased Gnip, a third-party social data miner. Previously Gnip was one of the three data companies granted access to the Firehose (DataSift and NTT Data being the other two) and the largest competitor of DataSift.

Specializing in what they refer to as “Human Data,” the company scans online conversations of consumers and sells it to businesses. Brands who use Gnip are able to see what is being said about their products and services across multiple social platforms in real-time. And since Twitter acquired Gnip and cut-out DataSift, all third-party data licensing will now be purchased directly from Twitter.

“The acquisition of Gnip was the first step toward developing more direct relationships with data customers,” wrote Zach Hofer-Shall, Head of Twitter Ecosystem, in a blog post on Friday. “The next step in working directly with data customers is to transition everyone receiving raw data for commercial use from other data resellers to a direct relationship with Twitter.

In short, Twitter is cutting out the middleman and firmly regaining control of the 400 million daily data opportunities sent out across the platform.

The Reaction

Unsurprisingly, DataSift did not take the news quietly. Nick Halstead, founder and CEO of DataSift wasted no time on expressing his criticism of the decision.

“Twitter demonstrated that it doesn’t understand the basic rules of this market: social networks make money from engagement and advertising. Revenue from data should be a secondary concern to distribution and it should occur only in a privacy-safe way. Better understanding of their audiences means more engagement and more ad spend from brands. More noise = less ad spend.”

But DataSift wont have to dwell on the breakup for long – as the company landed a partnership with the data-monolith Facebook last month.

One lesson all marketers can take away from this announcement is that the potential for data aggregation is a massive revenue opportunity not to be overlooked.