Is Facebook's News Feed Shakeup an Opportunity for Twitter?

By Markets Fool.com

Image source: Twitter via Flickr.

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It's safe to say that a lot of media outlets aren't very happy with Facebook right now, which could crack open a window of opportunity for Twitter.

Facebook's decision to make a News Feed algorithm change that favors posts from your friends and family over those from news publishers has rankled publishers large and small, some of which responded with defiant pieces like this one from The New York Times, one of Facebook's biggest news users.

Publishers have reason to be upset, especially since Facebook spent the last several months courting them to its Instant Articles platform with sweetened offers of revenue sharing and increased reach. They're undoubtedly feeling the sting of a jilted lover.

But this dust-up probably won't lead to much trouble for Facebook. It knows those publications need to keep posting on its site to reach their audiences, and the change is likely an experiment intended to increase user engagement. Facebook's most important job, after all, is to keep users on its sites as long as possible, looking at ads and serving up data.

The more interesting question at this point is whether the jolt sent through media outlets willpresent an opportunity for one of Facebook's competitors to capitalize on.

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If there's one company in the social media/digital advertising space that can use a catalyst about now, it's Twitter. But can it really offer something to these media outlets that they aren't getting through Facebook? And if it can, can it convert that into revenue?

Twitter is not very good at something very important

In ways, Twitter has been a natural fit for news. It is, after all, a real-time platform.

But there's been one big obstacle standing in the way of Twitter's developing deeper relations with media outlets: It historically has delivered very little traffic to their websites.

Indeed, more than four of every five visits made to media sites through web referrals come through two sources: Facebook and Alphabet's Google, which are responsible for 41% and 40% of that traffic, respectively.

Twitter's contribution? Somewhere around 1.5% for the "typical" news site, according to a recent Parse.ly report.

But it is well-positioned in a key growth area, too

One area where Twitter does excel, however, is video. And it's making video -- especially live video -- a priority moving forward.

Some media outlets recently told Digiday that despite the smaller audience that Twitter delivers, they were seeing bigger revenue from the ads on their videos on the platform than they were from videos posted to Facebook.

Twitter has been rolling out new features for videos and video monetization, too, not the least of which was dropping the old six-second limit on videos, thus paving the way for longer ads.

Twitter is also in a strong position when it comes to developing a live-video platform. Its three-year agreement to broadcast NFL games is a critical early step to building out what could be a much larger live video-programming platform -- one it hopes can draw a larger audience to Twitter on a regular basis.

The development of a bigger video platform dovetails with the earnest efforts many news outlets are making in digital video content and live video. What news outlets like The New York Times have been creating for Facebook Live can certainly be done with live video on Twitter's platform.

It's not too late for Twitter to make a move

News publishers are desperate for reliable online distribution, and Facebook had been shaping up to look like just what many media outlets needed -- a near all-in-one digital distribution network. But the News Feed algorithm tweak serves as a stark reminder that a market as dynamic as social media is no place to get comfortable with a singular strategy.

Twitter may not have everything it needs in place just yet to be advertisers' Plan B, and it will have to do more to deliver traffic to proprietary websites. But this News Feed kerfuffle serves as a reminder that with the right set of products and advertising opportunities, Twitter can still get back into the game and become a more important platform in news.

The article Is Facebook's News Feed Shakeup an Opportunity for Twitter? originally appeared on Fool.com.

John-Erik Koslosky owns shares of Facebook and Twitter. The Motley Fool owns shares of and recommends Facebook and Twitter. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.