SXSW: Is Twitter the next Napster?

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The title of the post was suggested to me by Emily Gordon, the moderator of the panel I served on earlier in SXSW. She and I had just spent some time huddled on the floor with a host of others, watching Umair Haque interview Twitter and Blogger co-founder Evan Williams on a screen, as the crowd had grown too large to contain in the Austin Convention Center's biggest ballroom. Despite the big draw, we both came away more than a little dissatisfied, and not just because we didn't get a chair.

Let's be blunt: Twitter is a really interesting service that is changing a lot about how we communicate; if you wanted to be really grandiose about it, you could say it's changing the world. You could have also said the same about Napster, and as Clay Shirky pointed out in his talk yesterday, that service was instrumental in revealing massive changes that the Internet would bring to our world. It also never really made any money, and ceased to exist in the form that mattered after only two years.

Napster founder Shawn Fanning, a brash teenager who created the service in his spare time, was a good face for the early dot-com bubble, just as Williams, with his hip but stylish clothes and resume of successful and cool companies, is a good face for the current iteration of the Internet as a phenomenon. The interview struck me as getting smugger and smugger as it continued; the overall tone was that the information-sharing Twitter enabled would be an unparalleled human good, with one of the cheif anecdotes offered to that end being how an angry Tweet from Haque got a dispute with his travel agent resolved quickly. (There was also talk of how repressive regimes won't be able to hold against the flow of information exchange forever, with no mention of the fact that, despite the much-heralded Twitter-driven Iranian resistance movement last year, the country remains a religious dictatorship.)

And lurking in the background was money, or at least the lack of it. Twitter has not to my knowledge made much, or any, money. There was some coy talk during the interview of an "ad platform" that actually turned out to be an "at platform," which will allow you to see tweets from your favorite people and brands just by hovering over words on a page on a non-Twitter site (sounds incredibly annoying!), which may or may not be a money-making scheme.

I gave Clay Shirky some crap in my post on his talk, but I do think that his blog post from March 2009, "Newspapers and thinking the unthinkable," really nicely put together the crisis facing the journalistic world today. Newspapers aren't failing because they're bad; in fact, they may be wholly necessary. They're failing because changes in technology have made them unprofitable. We're used to thinking about this dilemma in old media forms. But what about new ones that we come to rely on almost immediately? A compelling-looking technology with smooth pitchmen can get enough venture funding to run without income for a few years -- the dot-com boom proved that. But eventually Twitter will have to pay for its hundreds of employees and ballooning server and bandwidth cots. And maybe that's possible, and maybe it isn't, and maybe it only will be if the service is changed in ways that disappoint its more ardent users.

One of Shirky's jokes during his talks was that college-age kids no longer know what exactly Napster was; he usually tells them it was "BitTorrent that didn't work as well." The secret that Napster revealed has never been put back into the bottle, but Napster itself didn't survive, due to the crushing weight of lawsuits and, yes, the need to make money. All the things that everyone likes about Twitter will no doubt be a part of the way we communicate for years. But when are we going to figure out how Twitter is going to feed itself?

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