Web 2.0: Twitter co-founder Williams wants to kill suggested users list; praises Facebook’s agility

Twitter co-founder Ev Williams is onstage right now at the Web 2.0 Summit talking with moderator John Battelle. Here’s a transcript of the conversation:

[Update: Now that I’ve finished live-blogging, here are some takeaways: because the company’s rolling out lists, there’s really no need for the Suggested Users List, so Williams wants to kill it. He’s pretty doggedly focused on staying independent, rather than selling like he did with Blogger to Google. He also says there’s room for both Facebook and Twitter in the world and they serve different purposes. And naturally, he’s very coy about the revenue model.]

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John Battelle: Everyone wants to know what your revenue model is going to be. So what is it?

Ev Williams: Here’s how we spend our days. It’s not like we’re looking around in the couch cushion. We wouldn’t raise that much money unless we had something plausible, but we’re spending 97 percent of our efforts just trying to improve the technology and the product. What we have to do is the best, freshest, most relevant information possible. The irresponsible thing would be to take our eye off that when ultimately revenue and the product go hand in hand.

Battelle: So what’s the revenue model? What about if your revenue model were about little text links on the top and on the side of the Twitter.com domain and an export of that same engine out to the third-party developers like Tweetdeck and Brizzly and it was sort of like Tweetsense?

Williams: I like where you’re going.

Battelle: I’m going to check that off as maybe. I swear I’ll get off revenue at some point, maybe 25 minutes from now. Mobile/SMS has been a revenue source. You have a large number of well-known brands that want to work with you. How do I get me some of that Twitter in my marketing? (Disclosure: Federated Media, where I work, and Twitter have worked well together.) At some point, you might need a sales force like Facebook?

Williams: Yes. Not first. I can tell you why we’re optimistic about revenue. I can’t tell you exactly what the model is. It’s pretty obvious to you that advertising is in the mix. The reason why we like the prospects of Twitter. There’s a lot of commercial marketing and brand marketing on Twitter and it works. It’s not a social network. It’s an information network. It tells people what they care about right now in the world. And that’s potentially monetizable. If they can get messages seen on Twitter, that’s a powerful tool for marketing, or for driving traffic and business to food carts in the Mission or to Dell. Or for solving unsold inventory problems. That’s all working today. If that’s working for businesses, I’m not worried about extracting some of that revenue for ourselves.

Battelle: There’s some data that only you have. Is that a business you find interesting?

Williams: If we were to approach that — there’s a class of users that need that. There are so many different types of users doing different things. There are some obvious things that some of them would want, to have broader reach and have it be measurable. If we can do that, we think we can charge for that.

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Battelle: Twitter’s growth has plateaued in data we’ve seen publicly. Is it dying?

Williams: It’s growing in some areas and slowing in others. Where we’re seeing growth is internationally and in mobile. It’s not a very good gauge. Probably our U.S. Twitter.com traffic has slowed temporarily. There are some things we’re launching that will pick that back up.

Battelle: Another problem is that unless a Twitter user is evangelized, they’re confused. They follow John McCain and then Britney Spears. How do you address the “I don’t know what to do with it but I’ve heard about it on the Daily Show” type of user?

Williams: We definitely think about it. It’s low-hanging fruit for us. We’re optimistic about it. We hear all the time, I don’t get Twitter. I didn’t understand it. But I started following this friend. Or I heard that I could figure out that Caltrain was late. What we’ve never been very good at is finding that killer Twitter application for them. We’re focused on that now, kind of for the first time. It’s well-trodden territory. We think we can solve that pretty easily. Lists directly addresses that and a bunch of other stuff. It enables new use cases. It drives discovery. I’m just in the beta. I’ve found many interesting on lists that I didn’t know about before. There’s people who are following too few and people who are following too many. This will become more and more of an problem. Lists addresses both those scenarios.

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Battelle: Let’s talk about Facebook. They apparently gave a revenue model to you that you turned down. Have you ever woken up in the middle of the night in a cold sweat saying you should have taken the check from Facebook?

Williams: Never.

Battelle: So what was it in your mind that told you this time that you were going to go all the way and go for it, that you were going to make this company really big? You took a $1 billion valuation. Is it Twitter? Is it where you are as an entrepreneur? Or both?

Williams: It’s both. I’m not a visionary in terms. I didn’t see that Twitter was going to be the biggest thing ever. I took the job about 1 year ago. That’s around the time I realized this was going to be really big. We had a few conversations with friends in Palo Alto. Ultimately, I didn’t see a reason to sell because it’s not the point. The point is really to see what we can build. We believe very strongly that Twitter in enabling the open exchange of information is a good thing for the world. It’s what I’ve been working on for a decade now (with the 10th anniversary of Blogger). It inspires me and the team. The goal has never been to take a good exit for the founders and investors. I’ve always been inspired by what Tim (O’Reilly) said. Business is a context for doing interesting things. The things we can do with Twitter are endless. And that doesn’t get more interesting if we become part of a bigger company.

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Battelle: Since you haven’t become part of a bigger company, that company has become a lot like you. Facebook has added a lot of features that made it more Twitterific, let’s say. Do you fear them?

Williams: I don’t know how Facebook’s feature prioritization works exactly. I suspect that they came to a lot of the same conclusions we did in designing their product. They kind of inventing news feed thingie. We did something similar. They changed it and made it more similar. One thing that I admire about that company is that they’re so agile in reinventing their product. We all spend days thinking about how they’re going to change their product. We’re all too old at Twitter to have started using Facebook. We don’t use it to base our product decisions now. In a global sense, I’m sure the world is big enough for Facebook and Twitter. Fundamentally, they’re good at different things. They’re good at communications between people who know each other. I don’t think they are the death of Twitter.

Battelle: What do you make of Google Wave?

Williams: Everybody thinks about Google if they’re in this industry. If I wasn’t at Twitter, I’d be thinking about how to reinvent e-mail. I don’t know. We didn’t know what Twitter was going to be when we started it. We don’t know what Google Wave will be. From what I’ve seen, there’s already a way to tweet from Wave. So that seems great.

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Battelle: MySpace and AOL have announced that they’re syncing with Twitter. You guys are playing nicely. But so far, it’s a one-way dialogue with Facebook. Is that going to be fixed anytime soon?

Williams: That’s kind on their side. It’s highly possible that people have been talking about that. Not me personally. I don’t even know if that’s the right thing. I don’t think everything syncing with everything else is necessarily the best user experience. Different services provide different experiences. Tweets going into a Facebook status isn’t necessarily what people want.

Battelle: It’s true that the things you tweet aren’t necessarily what you want to send to your friends.

Williams: Every service will find its own use case.

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Battelle: There’s a question of sustainability. Is there a business model — in terms of the third-party developers — they’re holding back in developing apps because they don’t know quite how to participate with Twitter in a revenue model.

Williams: We need to give them more assurances that they can invest in our platform. We can be better about providing some rules and guidelines. We’re working on some terms of service for the API that incorporate a lot of our expectations. I know it doesn’t give people a lot of assurances but the developers are crucial to how we see Twitter developing.

Battelle: Are you concerned about your ability to scale and how do you address that?

Williams: I’m not as concerned as I used to be. But I’m not satisfied about where we are. In the last year, the core problems got fixed. Scalability isn’t an issue for Twitter. Most pieces are horizontally scalable. There’s a few pieces we still have to fix and we have engineering plans for them. Reliability is another issue. We’ll be working on that.

Audience: I know a lot of instances of people and business users who thought they were doing everything according to your rules and they wake up and find their account’s been suspended. It’s so not clear what the rules are. They’re not spammers. How can you expect people to invest time if they don’t know what the rules are?

Williams: That’s unfortunate. It sounds like the suspension was probably due to — we’ve had some bugs or some overactive spam killing scripts that have suspended people. In that case, it’s our fault. In terms of making the rules clearer, we could be better at explaining that.

Audience: Couldn’t you kinda warn people before you kill them?

Williams: Yes, duly noted.

Audience: You mentioned international growth. What are the countries or regions that are popping up?

Williams: The top 5 right now in terms of active users are U.S., U.K., Brazil, Japan and Indonesia. Indonesia has been growing like crazy. In terms of what’s growing fastest, I’m not sure. We’ve just in the last week made major launches in India and Japan, both on the mobile side. We launched a partnership with Airtel to offer free Twitter SMS to their 110 million customers. In Japan, we launched our mobile web client. Mobile web is a very big deal in Japan.

Battelle: One of the big growth stimulants to Twitter has been celebrities. Studios are starting to put in no-Twitter clauses into their contracts because they don’t want them to have direct access. Are you concerned about what? Are you lobbying against these evil Hollywood studios?

Williams: It’s not on my top list of priorities. I was talking to owner of Patriots I asked him about tweeting from the field. He realizes that the fans would love it. But he doesn’t want them releasing information that the other team could use.

Battelle: They could always do headfake tweets.

Williams: Uh, yea. While the studios are doing that, agents are lining up endorsement deals. I’m pretty sure the open exchange of information will prevail in the end.

Audience: I spoke at Digital Hollywood conference to celebrities who would love to do more DMs. They have 10s and 10s of thousands of followers.

Williams: They’re running into a DM daily limit? We try to set up a DM daily limit. If people with legitimate usage are running into that, we’ll look into it.

Audience: As a journalist, it blows me away how Twitter can gather information. How do you envision new toolsets for the media, or what it becomes to help people disburse and track down information?

Williams: I’m glad to hear that you’re seeing that use. It’s something we’ve seen for a long time. We’re putting a ton of effort into search. It’s pretty clear that we’ve just scratched the surface. We have all this real-time data. We have the ability to mine and display that, but we need to be much more intelligent about that. Search is something we’re working on a lot. We have a small but growing search team. Secondly, the tools for the media is a great area for third-party developers. We need to focus on what mass users need.

Tim O’Reilly: For a long time, there was really only one list which was the suggested users lists. It created great distortions. Is it time to retire the Suggested Users List?

Williams: Yes. The SUL is controversial and I understand why. We thought we’d just do the easy thing now. I definitely want to kill it or evolve it. Once we get lists rolled out. We can make things more Twitter-y and democratic.

O’Reilly: Lists were a feature of many third-party clients. You’re starting to bring features from the ecosystem back into Twitter. You’re starting to competing with the best features of the ecosystem.

Williams: This is a classic dilemma of platform companies. The way we approach all these things is to build an API along with the feature. Hopefully that makes it more powerful. Tweetdeck has gotten popular because of similar functionality. It can’t let you follow lists created by other people. With lists, location, retweet and all these features we’re on the verge of launching, we can give people a heads up and all the clients in the ecosystem can be better for it.