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Fundamentals

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PREFACE
In stunning news we just learned that Twitter has beaten out Amazon, Verizon, Facebook, Google, Yahoo!, Apple and a host of other companies to stream the NFL's nationally broadcast Thursday night football games. The implications are substantial. But the news goes much further.


DETAILS
Twitter will pay $10 million for the rights to stream 10 of next fall's 16 Thursday night games — the same 10 games CBS and NBC will broadcast.

We know that last year Yahoo! paid $20 million for a single game, and all parties agreed it was a "success." While Wall Street has focused on Twitter's 320 million average users (MAUs), the company has time and again pointed to its additional 500 million MAUs that are not logged in. The NFL games will be made available to this non-logged audience as well. Here's a snippet from r/e code:


But that's not the real news. Twitter is making strides to come out from under the underdog label and it's trying to be the next technology giant. Here we go:

REAL NEWS
Twitter's play here is to engage the logged out user base and turn those people into active users. The company already announced a plan to monetize the non-logged in user base into $1.3 billion -- that's straight from COO and Head of Revenue, Adam Bain.

The inertia behind this NFL deal started well before today.

CML Pro wrote just a week ago on March 30th, 2016: "Twitter's Secret Weapon is Finally Attacking Facebook and Google." In that article we discuss, at length, the remarkable growth that Periscope is showing, having doubled the number of broadcasts within three-months of being added directly into the Twitter stream.



Now, make no mistake, this NFL announcement was a win for Twitter -- not a gift or a de-facto landing. Twitter simply beat the tech giants and that includes Apple's silent attempts. Here's another snippet from re/code:


But there's so much more going on that points to one simple fact: Twitter is winning, it doesn't look like it's going to stop and now Facebook and Google know it.

@jack @adambain $TWTR

gif library
new timeline (engagement +)
private messages (engagement +)
periscope (engagement +)
NFL

You're winning.

— Ophir Gottlieb (@OphirGottlieb) April 5, 2016

ONLINE VIDEO
Online video consumption is exploding. In fact, both Facebook and Snapchat have separately noted that they now receive over 8 billion video views a day.

Twitter has thrust itself into the fray with Periscope. But this goes back even further.

STARTING LINE
First, CML Pro research revealed evidence that there is a substantial turnaround occurring at Twitter, one that addresses some of the critical concerns surrounding the stock.

We've gone to the company, then did dome digging through Twitter statements in earnings calls and publications. Here's what we found and published in our CML Pro research dossier


Going back yet further:

SVOD
This all started with streaming video on demand (SVOD). The SVOD market is set to rise to $27 billion. Here's the image from Statista:


This is where Netflix (NFLX) and Amazon (AMZN) Prime come in. Netflix has over 90% penetration in the United States for homes that have access to SVOD while Amazon has about 40%.

Now, SVOD isn't really what Twitter and Facebook are after -- but it was the genesis of an enormous thematic trend and lead to the new battlefield: Streaming Online Video.

ONLINE VIDEO
Both online video and online video advertising are booming themes just now gaining tremendous momentum. These are the most popular video streaming sites.



And here is the revenue growth that's being generated:



While our first image showed the dominance of Google and Facebook -- there's a quiet shift happening at Twitter's Periscope, and the rattle may soon turn into a cacophony of growth. Today's NFL news is the continuation, not the start, of that growth.

TWITTER
Everyone has been waiting for Twitter to show growth -- anywhere. We hear staggering numbers from Facebook, Google and Snapchat and we wait -- and wait.

Now it's happening in the fierce battlefield that is online video: Since Periscope's launch last March, more than 110 years of live video has been watched via Twitter's live streaming video app everyday.

But, since the app was enabled within Twitter users' timelines, it has reached more than 200 million live broadcasts. That's more than double the number of broadcasts Twitter announced just three months ago -- when it launched Periscope live video streams directly within user timelines.

MORE
Twitter revealed that the number of direct messages grew over 60% in 2015, but even better, the number of Tweets shared privately has grown by 200% in just the second half of last year.

"Now — in just a few taps — you can share unique Twitter content from your timeline right into your private conversation."

Engagement is happening -- and that's simply pure terror to any other company because Twitter's position as the real-time communiques hub of the world is starting to set in stone.

SPEAKING OF REVENUE
Here is Twitter's incredible all-time revenue (TTM) chart via Capital Market Labs (CML Pro):



And the growth -- it's enormous relative to peers. Here is a chart that compares Twitter's revenue (TTM) growth over the last year with other technology companies of similar market caps:



Twitter is growing faster than all but one other technology company in this peer group.

RECONCILING THE NUMBERS
As of August 12th, Periscope reported that it received 40 years of video watched a day on mobile, alone. This was the growth chart as of August 12th:



We now know that the number is 110 years. Periscope has essentially tripled its users since August and it has doubled its broadcasts since January. If we were all waiting for a part of Twitter to show that parabolic growth -- friends this it and you better believe Facebook and Google are watching.

There's a reason Google is cozying up to Twitter and it goes way further than search results. Google has found a weapon in Twitter that can compete with Facebook and the Apple TV. We discuss those details in CML Pro, but Facebook may now be finding a legitimate competitor from a Twitter / Google team.

SEEING THE FUTURE
While Google, Facebook, Amazon and soon Apple, with its new social network patent filing, will battle for MAUs, they lack the advantage that Twitter has. There is one king of real-time communiques and it's Twitter, by a lot.

Now, to really understand why Twitter will finally be a winner, and then to go further, to find yet again the the 'next Amazon' or the 'next Apple,' we have to get ahead of the curve. This is what CML Pro does. Our research sits side-by-side with Goldman Sachs, Morgan Stanley and the rest on professional terminals, but we are the anti-institution and break the information advantage the top .1% have.

Each company in our 'Top Picks' is the single winner in an exploding thematic shift like artificial intelligence, Internet of Things, drones, biotech and more. In fact, here are just two of the trends that will radically affect the future that we are ahead of:



The Internet of Things (IoT) market will be measured in trillions of dollars as of next year. CML Pro has named the top two companies that will benefit. Then there's cyber security:



Market correction or not, recession or not, the growth in this area is a near certainty, even if projections come down, this is happening. CML Pro has named the single best cyber security stock to benefit from this theme.

These are just two of the themes we have identified and this is just one of the fantastic reports CML Pro members get along with all the visual tools, the precious few thematic top picks for 2016, research dossiers and alerts. For a limited time we are offering CML Pro at a 90% discount for $10/mo. with a lifetime guaranteed rate. Join Us: Get the most advanced premium research delivered to your inbox along with access to visual tools and data that until now has only been made available to the top 1%.

Thanks for reading, friends.

The author and the author’s household hold shares in Twitter as of this writing.

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