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Twitter's TweetDeck buy a 'defensive' move

Microblogging site's now-confirmed acquisition of TweetDeck is a "defensive move" to gain more control over ecosystem, and highlights its continuous struggle to monetize platform, says analyst.

Twitter's acquisition of TweetDeck is a "defensive move" and underscores the microblogging site's continuous struggle to monetize its platform, according to an analyst.

Eden Zoller, principal analyst at Ovum, said in a Thursday statement that the US$40 million acquisition is an attempt by Twitter to gain more control over its ecosystem. The move, however, highlights a number of concerns about Twitter's strategy, she noted.

Zoller pointed out that growth and innovation in the Twitter ecosystem is increasingly driven by third parties. In fact, the company announced at its developer conference last year that 75 percent of its traffic is driven by third-party applications and partners including TweetDeck, she added.

"The concern for Twitter in this scenario is that the applications that are driving growth are largely outside of its control in terms of direct monetization," she said.

To counter this, Twitter has been developing its own official applications or buying up popular rivals, especially on the mobile front, Zoller added.

Last year, Twitter released proprietary apps for Research In Motion's BlackBerry and Apple's iPhone platforms, much to the ire of developers.

According to Zoller, Twitter is also discouraging developers from creating new Twitter clients, citing consistent user experience as a reason. However, the "unspoken message" is that the microblogging site does not want developers to compete against it, she said.

Twitter, noted Zoller, has been facing an "ongoing struggle" to better monetize its platform, and it hopes to address this by gaining more control of its ecosystem. However, the company needs to be careful about its approach, she warned.

"If Twitter addresses [its monetization plans] in a way that thwarts developers then it will alienate the community that has played a critical role in making Twitter the popular service it is today and building the ecosystem that supports it," said Zoller.

The TweetDeck acquisition was confirmed on Wednesday by Twitter COO Dick Costolo via the company's official blog. In his post, Costolo labeled TweetDeck as "a great example of a third-party developer" which has "created value for the network".

"This acquisition is an important step forward for us," he said. "TweetDeck provides brands, publishers, marketers and others with a powerful platform to track all the real-time conversations they care about. In order to support this important constituency, we will continue to invest in the TweetDeck that users know and love."