Twitter Inc. (NYSE:TWTR) Has Found The Massive Sports Market
This is the seminal moment for Twitter -- the singular advantage it has in a competitive landscape otherwise dominated by Facebook and Google. Twitter finally has a home and it's rather large.
The innovation from Twitter Inc. (NYSE:TWTR) has flipped upside down, going from slower than imaginable to faster than imaginable. The narrative a month ago was disastrous. The narrative today is, well, whatever the opposite of disastrous is. And yet, today, more market moving news from Twitter hit the mainstream media and this time it's not an app, an improvement or a cool technology. Today Twitter stakes a claim to the massive sports market and it has beaten Facebook Inc. (NASDAQ:FB) and Alphabet Inc. (NASDAQ:GOOGL).
Twitter Inc. (NYSE:TWTR) announced its deal with the NFL a few months ago -- it's first to carry live streaming sports. At the time, the world was still in the "doubt all things Twitter" narrative so the reaction to it was relatively muted. We later found out that not only did Twitter win the sports business with a lower bid than rivals at $10 million, but that the firm has already sold about $50 million in ads surrounding the streaming games, making the investment not only a huge traffic driver, but in fact explicitly ROI positive.
That last part made the news today somewhere between expected, obvious and genius.
Recode broke the story first, that Twitter is now speaking with the NBA, MLS (major league soccer) and Turner to acquire rights to yet more live sports streaming.
When Twitter won the rights to stream the NFL games the single most critical element was feedback from the NFL. TWTR beat Facebook over the acquisition of these rights with a lower bid because the NFL felt that Facebook undervalued content rights and has a poor monetization model, according to sources close to the situation (CNBC).
That's right, Twitter was hand-picked over Facebook and the other rival bidders because of its reach. The confirming evidence to this hypothesis comes today. Quietly, Twitter appears to becoming the single and definitive home for live streaming sports. For all those that were looking for a flag in the ground moment for Twitter, this is it. This is the tangible, explicit advantage and it is massive.
Here is what Twitter CFO Anthony Noto said in April:
TWTR THE WILD RIDE
Beyond the world of sports, Twitter's innovation has been massive.
From Twitter Carousel, Twitter Engage and Twitter Insiders, to Twitter's new location feeds, new video access, extended video play times, Twitter owned Periscope's rapid move toward advertising friendly tools, and of course the mothership of them all -- Twitter selling advertisements to 500 million more users that are logged out, in addition to its 310 million monthly average logged in users, the innovation in just the last month as been breathtaking.
WHY THIS MATTERS
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The author is long shares of Twitter and Apple.