Social media comes of age, profitability

2009 was year that saw social networks, apples, droids, geo-based apps and cloud become hot industry keywords, with Twitter finally clocking profit.
Written by Kevin Kwang, Contributor

It may be all of only 140 characters, but microblogging site Twitter took off to greater heights last year, alongside another social network bigwig Facebook.

The past 12 months also saw smartphones soaking in the limelight as the segment bucked an overall handset market slide to register a 27 percent increase in worldwide shipment.

Here's a look at five keywords that defined the tech industry in 2009.

Love it or hate it, the real-time phenomenon known simply as Twitter is here to stay, particularly after the microblogging site has demonstrated such significant global reach and influence.

The Iranian presidential election held in June is a case in point of how Twitter can be used to rally the masses for a cause. When incumbent President Mahmoud Ahmadinejad was proclaimed the winner on Jun. 12, Iranian supporters for opposing candidate Mir-Hossein Mosavi took to the streets--and Twitter--to voice their discontent.

Twitter users changed their profile backgrounds and avatars to green--Mosavi's party colors--in protest of suspected fraud and manipulation of the polling results. A CNN report noted that the post-election street protests eventually came to be known as the "Twitter Revolution".

More significantly, it showed the world how real-time news updates by civilian journalists can and have trumped traditional media outlets with the speed of information disseminated to a wide audience. According to a Mashable blog post, "CNN's complete lack of coverage early in the Iranian election crisis spurred a vicious backlash from Twitter users".

As for the business itself, 2009 saw the microblogging site finally achieve profitability. Since its creation three years ago, the startup has focused more on adding to its subscriber base rather than generating revenue.

But after inking US$25 million worth of deals with search giants Google and Microsoft in October 2009, the social media company now has the funds to further expand its business. Twitter's Internet search deals will make tweets published on the site searchable on the other two companies' search platforms, according to a Bloomberg Businessweek report. This imbues a real-time element to search results. However, not to be outdone, Yahoo announced its own real-time search plans days later.

Another social-networking site also made waves last year. In fact, some may argue that it made more of an impact than Twitter did. That site is Facebook.

According to a Mashable blog post, Facebook grew from 150 million users in January to about 350 million users by end of last year--no small feat considering Twitter garnered a 2009 forecast of 18 million U.S. users by market research firm eMarketer.

Furthermore, Facebook is among the most searched for word in 2009, according to a research done by Google. In the search giant's annual Zeitgeist report that looks into queries typed in by users over the world, the term "Facebook" was listed as second in the "Fastest rising (Global)" category; fellow social media site "Twitter" came in at fourth.

There was a similar trend in the Zeitgeist breakdown for Singapore. Facebook topped the "Most Popular Searches of 2009" segment, while "Facebook log-in" came in at seventh. In comparison, Twitter came in at only seventh in the "Fastest Rising Searches of 2009" category.

Recently, the social-networking site also stated its intentions to become a digital identity repository, or what Facebook's vice president for products, Chris Cox, termed an "identity medium" for transactions between individuals and businesses inhabiting the Web.

Already, its universal login product, Facebook Connect, has linked up with more than 80,000 third-party sites such as Yahoo, Foursquare and Gowalla to provide data portability over the Internet. To date, more than 60 million users have signed up to use the service.

This move is expected to gain more traction in 2010, as Facebook starts to open up its valuable user database to advertisers. The Yahoo-Facebook Connect deal could be seen as a precursor of things to come as the search engine operator intends to tap the former's user data to place more relevant ads on its own Web site.

It was a year of apples and droids, too. In other words, smartphones.

While the mobile handset market sales fell six percent year-on-year from 305 million to 286 million units in the second quarter of 2009, according to research firm Gartner's figures, global smartphone sales bucked the trend. This increased by 27 percent from 32 million to 41 million units in the same time frame.

The mobile handset that captured the imagination of consumers for most of 2009 was Apple's iPhone as it continued to build on its increasing popularity with the updated iPhone 3GS introduced in June.

More than just a phone, the iPhone is a multimedia platform that allows users to do anything. Activities can range from buying gifts online to paying bills, and from catching up with friends through social-networking sites to playing online games through applications downloaded from its App Store.

This had the industry buzzing as software developers, trying to ride out a year when venture funds were drying up, sought to write a "killer app" that would be downloaded widely to bring in the money.

Later in the year, smartphones running Google's open source operating system, Android, started to gain much market traction as U.S. wireless operators such as Verizon and Sprint Nextel collaborated with device manufacturers like Motorola and HTC to launch Android phones.

Besides giving consumers an alternative choice, the Android Market proved a welcomed addition for software developers struggling to get their applications approved by Apple, whose opaque approval process was widely criticized last year.

Furthermore, the market is anticipating the imminent launch of Google's own Android OS-based smartphone, the "Nexus One", to further shake up the smartphone industry.

Cloud computing
Most industry insiders are predicting 2010 to be the breakthrough year for cloud computing.

But the technology was already heavily looked into by enterprises in 2009, as businesses sought to cut operational costs and increase productivity by maximizing their IT resources during the recession and ensuing recovery period.

A survey conducted last June by AppLabs showed that 50 percent of 104 Global 2000 companies were already using or are planning to deploy cloud computing services into their IT infrastructure in the next 12 months.

According to research firm Gartner's definition, cloud computing services are defined as "service-based, scalable and elastic, shared, metered by use, and delivered using Internet technologies".

However, many CIOs and small and midsize businesses (SMBs) are still waiting for cloud service providers to improve on their security and compliance and to establish a common standard in the industry before they jump on the bandwagon.

Geo-based applications
Everyone, from Apple and Google to young startups such as Foursquare, Gowalla and Brightkite, is looking to tap on the now ubiquitous global positioning system (GPS) to serve up geolocation-based service applications this year.

Google, for one, launched its Google Latitude service last February to allow mobile phone users to keep in touch with their friends and loved ones, wherever they may be based.

However, speculation became rife that Apple was trying to enter the geolocation market, too, after it bought over maps application programming interface (API) company, Placebase, in July. The Cupertino company also blocked Google's application to be made available as a native iPhone app on its Apple App Store. Instead, it requested that the search giant run this as a Web application so as not to confuse phone users with the existing Google Maps app, fueling suspicion that Apple was developing similar software.

Meanwhile, mobile startups such as Gowalla, Foursquare and Brightkite are emerging as geolocation-based service software developers touted to become the next Twitter or Facebook phenomenon. In fact, founder and CEO of Mashable, Peter Cashmore, had earlier predicted that Foursquare would be 2010's social media "poster boy".

Twitter, though, has been making strong inroads to ensure it continues to dominate the social media scene and trump the startups. To that end, the microblogging site in December bought over Mixer Labs, the company which created the GeoAPI location service for developers building applications atop Twitter.

Utilizing this new capability to include geolocation information to its users' tweets, Twitter might be well poised to retain market share and possibly beat back these new upstarts in the social media sphere.

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