Twitter is in a video arms race with rival social network Facebook. The former acquired SnappyTV in June, a cloud-based video creation, distribution and measurement tool used by companies like Fox and ABC News. Meanwhile, Facebook has also invested heavily in video, most recently by acquiring video supply-side platform LiveRail and by introducing Premium Video Ads and new metrics to determine the success of brand campaigns.
"Twitter knows that they need to make moves against big numbers, so they can't do small things," said Mark Josephson, CEO of early Twitter link-sharing platform Bitly. "Digital video is growing incredibly fast and there is a big pool of money where there's not a clear winner yet. So much of what's happening at Facebook and Twitter has been around direct-response, and they've proven that's working well, but branding and larger storytelling is hard to do."
By offering more compelling and formats around "sight, sound and motion," Twitter will have access to more strategic brand conversations while simultaneously increasing its cut on CPM, since video commands higher pricing.
Twitter's revenue for Q2 was $312 million, a 124% increase year over year. The company has routinely tried to defend its user growth and engagement numbers, and this quarter cited 24% growth in monthly active users to 271 million average MAUs. Although this was still down from the 25% growth rate recorded the quarter before, company chief Dick Costolo said he expects two to three times that number to visit Twitter each month without logging in.