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Google Search Is Twitter's Plan To Monetize 500 Million Logged Out Users

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Google Search Is Twitter's Plan To Monetize 500 Million Logged Out Users

Twitter Inc (NYSE: TWTR) wants to monetize the millions of individuals who use the social networking platform but don't actually log in. The user base includes people with accounts, but it is primarily made up of those who view tweets but have yet to sign up.

By teaming with Google Inc (NASDAQ: GOOG), Twitter might have finally found a solution.

"Google's already crawling Twitter for tweets, so they're showing up in organic search because Google is being Google," MKM Partners analyst Rob Sanderson told Benzinga. "That's how Google works. This is just opening the data pipes so that it's easy. You're probably going to rank higher, you're probably going to get more traffic via organic search than you're getting now. But they're already getting some."

Related Link: Why The Google-Twitter Deal Is A 'Win-Win' For Both Parties, Wedbush Analyst Says

A Win For Logged Out Users

Sanderson said that he expects the Google/Twitter deal to primarily impact the logged out audience. He said Twitter has talked about these users before and provided a metric: 500 million.

"Seventy-five million of those are coming from search," he said. "Maybe that number goes on. People kind of discount that number anyway because they're not monetizing it. If they think they can monetize the logged out audience over time, this is gonna help them grow that audience."

Twitter's average MAUs (monthly active users) came in at 284 million during the third quarter. That represented a 23 percent increase year-over-year, and 80 percent of the total MAUs came from mobile.

In the Q3 earnings release, Twitter CEO Dick Costolo said that he was confident in his company's ability to "build the largest daily audience in the world." Ironically, Twitter's DAUs (daily active users) were not highlighted in the company's third quarter results.

Facebook Inc (NASDAQ: FB), on the other hand, was happy to report that it had amassed 890 million DAUs in December 2014.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

Latest Ratings for TWTR

DateFirmActionFromTo
May 2020CitigroupMaintainsNeutral
May 2020SunTrust Robinson HumphreyMaintainsEqual-Weight
May 2020B of A SecuritiesReiteratesBuy

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