Twitter confirms TweetDeck purchase

After weeks of rumours, Twitter has purchased TweetDeck, the provider of a popular client to help people use the micro-blogging site.

Twitter has confirmed its acquisition of London-based TweetDeck, the third-party client. Photo credit: Pixelbully

The acquisition was announced on Wednesday via the companies' blogs and Twitter feeds. Financial details were not disclosed, but sources close to the deal said Twitter paid $40m (£24.5m) in cash and stock, according to a Financial Times report. That is in line with reports in April, which suggested the deal would be worth around $50m.

London-based TweetDeck's third-party client for Twitter provides extra functionality, allowing users to track tweets in a dashboard of trends and conversations. It is available for desktops and mobile devices based on iOS and Android.

"TweetDeck provides brands, publishers, marketers and others with a powerful platform to track all the real-time conversations they care about," Dick Costolo, Twitter's chief executive, said in a blog post. "TweetDeck is a great example of a third-party developer that designed tools for the incredibly important audience of Twitter power users and, in turn, created value for the network as a whole."

TweetDeck is a great example of a third-party developer that designed tools for the incredibly important audience of Twitter power users and created value for the network as a whole.

– Dick Costolo, Twitter

Costolo confirmed that Twitter will "continue to invest in the TweetDeck we know and love".

Twitter has snapped up other providers of popular third-party tools for its service in the past. In April 2010 it bought Atebits, the company behind Twitter iPhone app Tweetie, and in July 2008 it announced its acquisition of Summize, which offered a search tool for Twitter. Both technologies were absorbed into the general Twitter service.

TweetDeck, which is based at the so-called 'Silicon Roundabout' in Old Street, will remain in London and will keep the same "focus and products", chief executive and founder Iain Dodsworth said in a blog post. He confirmed that the team behind TweetDeck will remain the same, despite "change [being] inevitable". TweetDeck's employees are now working for Twitter, bringing the headcount at the social-media company to 505.

Different user levels

The purchase will help Twitter maintain an active user base by providing two versions of the service for different user levels, according Alys Woodward, software analyst at IDC.

"The challenge for social-networking sites is to keep new features coming to maintain users' interest, while avoiding cluttering up the application to the extent that new users are discouraged," Woodward told ZDNet UK. "Failing to do these can mean users stop visiting, and worse, move elsewhere. The dual interface of web Twitter — including the mobile versions — for basic users and TweetDeck for power users is a good solution."

Woodward said that TweetDeck's success was due to it having "no competition in terms of end-user adoption".

"This [purchase] underlines the fact that for start-ups that manage to do the deal, there is money in social media — but for each one that does, there are plenty that don't," she said.

TweetDeck has been assessing the best way to raise more money for approximately six months, weighing up the options between fundraising and acquisition, Dodsworth said in an interview with AllthingsD on Wednesday. In February, the company was rumoured to be in line to be taken over for £19m by UberMedia, a Californian social-media company that had previously bought third-party Twitter providers Twidroyd and UberTwitter.

In March, Twitter urged third-party developers to stop making client apps for the platform in a bid to harmonise access to the service. It had also previously suspended access to three UberMedia-owned clients for violation of its privacy and content policies, and trademark infringement.

"Twitter has clearly been moving to claim more of the pie around its service in last couple months. This is bad news for Twitter clients like Seesmic and Hootsuite," Jeffrey Mann, a collaboration and social software analyst at Gartner, told ZDNet UK. "Overall, this kind of consolidation is a sign of a maturing market, with more money sloshing around."