Twitter continues to press forward with improvements to its platform even as the young social-media phenomenon moves toward monetization with advertising opportunities. On Friday, Twitter announced it has acquired a mobile-messaging company called Cloudhopper. Terms of the deal were not disclosed.
Twitter has been working with the startup over the past eight months to become one of the highest-volume SMS programs in the world. As it stands, Twitter said it processes almost one billion SMS tweets every month -- and that number is growing globally as users from the United States, United Kingdom, Australia and Indonesia rely on mobile phones to update their status.
"Twitter was inspired by SMS and we continue to embrace this simple but ubiquitous technology," said Kevin Thau, who works with Twitter's mobile products and partnerships group. "In fact, Twitter's 140-character limit was designed specifically to allow for any tweet to be read in its entirety whether you're using a rudimentary mobile phone or a more sophisticated Internet-enabled device."
The acquisition should come as no surprise to Twitter watchers. Twitter cofounder Biz Stone pointed to SMS as a major growth opportunity for the company during his keynote presentation at the CTIA trade show earlier this year.
"There are over four billion mobile-phone accounts in the world, all essentially Twitter-ready," Stone said. "Compare that to only about two billion PCs. So it creates a huge growth opportunity for us. When a farmer in a rural village in a Third World nation can get information over SMS, it can have a dramatic impact on his life. We've always been excited about Twitter being able to work over this rudimentary network of SMS as well as the high-tech smartphones."
Twitter previously inked deals with SMS partners like Telstra in Australia. The company also works with Bharti Airtel in India, Vodafone in New Zealand, AXIS in Indonesia, O2 in the U.K., and every major player in China. With its own platform, Twitter can advance its SMS cause more quickly.
"Twitter has always been focused on the mobile market. But in recognition of mobile user adoption and the all-but-certain future growth of mobile usage, Twitter is beefing up its SMS 'infrastructure' with this acquisition," confirmed Greg Sterling, principal analyst at Sterling Market Intelligence. "It just makes the company less dependent on somebody else in a critical channel."
What is Cloudhopper?
Thau said the acquisition of Cloudhopper will help the micro-blogging company grow and scale its SMS service. Cloudhopper's messaging infrastructure will let Twitter connect directly to mobile-carrier networks in countries all over the world.
Cloudhopper may be a startup, but it has expertise in mobile messaging. Cloudhopper actually powers some of the largest and most successful mobile-messaging (SMS and MMS) campaigns in North America, Europe and Africa, although the company declined to disclose its clients.
Joe Lauer founded Cloudhopper in late 2008 to provide mobile-messaging technology and expertise to businesses in the wireless space. Lauer was also founder and vice president of Simplewire, one of the first SMS aggregators in North America. Simplewire was acquired by Qpass in 2006 and is now known as OpenMarket, a division of Amdocs.