Twitter Is Going The Way Of Twitch And That’s (Probably) A Good Thing

When the going gets tough, the tough start live streaming games.

For all of the products that were supposed to drive user growth and revenue that Twitter’s launched in the past few years (I’m looking at you Moments), it wasn’t until Thursday that one emerged that could actually push its ticker symbol vertically. And while the uptick isn’t unexpected, given the company’s rocky… well, lifetime, it wasn’t a sure things that when all was said and done the NFL would have come through for them.

But the reviews are in and they have been overwhelmingly positive. You can only imagine Jack’s sigh of relief as $TWTR showed signs of a future where it’ll flirt with the $20 mark on Friday (it was down on Monday but for reasons unrelated to current performance).

And so, it seems Twitter may have learned an important lesson, one forged by an earlier and equally floundering startup predecessor: Twitch.

It’s hardly a sure thing that this will all pan out for the little blue bird, but hear me out. What Twitter needs realize coming out of this deal is a fundamental truth of internet commentary: users rarely create meaningful content. This means that Twitter, for revenue purposes, needs to consistently give them something to watch and engage with. It has to give them something definitive, perhaps something professionally produced.

No one quite proved that this theory is a path to profitability (or acquisition) better than Twitch. If you want the full story, check out the awesome Gimlet podcast Startup (Season 1), but the short of it is this: Twitch started as Justin.tv, a site dedicated to the 24/7 live-streaming for individuals with no real focus or format. It was a free-for-all of user generated content that led nowhere–especially when it came to revenue growth–despite drawing a sizable initial following. It wasn’t until the company stumbled upon competitive gaming that it realized how it could get users hooked: give users a lane, a focus, and at that one focused on a product that ensured quality.

There’s a common misconception that if you put a whole bunch of people in the same place on the internet, they’ll interact. Often, that seems like the case. But communities don’t actually form that way. They don’t simply come together to talk about the things they love in a productive manner. They require a shared experience that they actually care about in order to have a meaningful.

Twitch embodies this by giving users a game to watch and react to in unison. The experiences even look similar.

If you’ve ever been to a conference think about it this way: there’s nothing more painful than the opening cocktail party. It’s a forced conversation without a core to return to. Eventually, it tires you out. But have the same conversation during or after the keynote, and people will be hooked. They’ll have material. Twitter lights up in these moment.

Twitter, like Twitch may have finally learned the key to building an engaged audience: give people something to talk about. Bring passive consumption and active commentary together simultaneously and you’ll provide a unique value–and a unique venue–that will encourage people to interact and become rooted.

For Twitch, this realization pulled them out of the red–or at least out of stagnation–and led to an Amazon acquisition, turning the founders into millionaires overnight. Twitch still owns the gaming visual space.

Twitter has deals inked with the MLB and NBA; there’s a pattern forming. From there, it’s a question of verticalization. Sports is a big start, one that many publishers could never accomplish, but can it own more spaces? They have partner teams in politics, entertainment and news, but can it make the same deals happen? Or does it stay here? Sticking to sports may be more than lucrative in its own right, but relegates the platform to second-tier niche status. And it will never be ESPN.

Twitter has finally learned how to capitalize on the core of its business–commentary, but their business development acumen seems to be more key to their longterm success than does their product now. They’ll soon outgrow Twitch’s lessons and need to create more hubs for expansion. That’s a business game.

Can they own a space new space? If you want to predict Twitter’s growth, watch for more of these deals.