Twitter Shuts Down Another Payment Effort

As Twitter has grown and morphed into much more than a social text-messaging board, it's been hoped that it could play a crucial role in online payments. This is especially true given that Jack Dorsey founded both Twitter and Square. It seems that Twitter does indeed want to innovate in payments, but only when Twitter is the entity doing the innovating. For the second time in a week, Twitter had forced a digital payment experiment to halt. Tuesday's (April 16) action was to silence Flattr, a Swedish startup that offered users the ability to pay content producers for their efforts, a so-called online tipjar.

A few days earlier, it was Ribbon that was forced to halt its in-stream payment efforts.

Flattr CEO Linus Olsson said Twitter said the payment efforts were violating Twitter's API terms. He quoted Twitter as telling him, "Your advertisements cannot resemble or reasonably be confused by users as a Tweet. For example, ads cannot have Tweet actions like follow, retweet, favorite, and reply. And you cannot sell or receive compensation for Tweet actions or the placement of Tweet actions on your Service."

Olsson made a reasonable argument: "This is a quite logical clause as it would stop companies to sell e.g. retweets and followers. It's an understandable rule to keep the Twitter network clean but in this case the rule is strangely stomping out innovation on their platform. However, the term Twitter call to is a term about advertisment that states that we can not be compensated. One can argue that we can not get money based on this clause. Even though we think that is not obvious. So we suggested to forgo our 10 percent, to not be compensated as a service. This would mean that the flattr donation (would) go from supporter to creator in it's entirety. That did not help."

Olsson argued that Twitter is not being reasonable. "The idea of not letting people use their favorites in the way they want is in no way is mentioned in the API terms. We feel that Twitter is reading things into their terms that are not there," he said.

The fact that Twitter has shut down two payment efforts on its service in just a few days suggests that it has its own ideas as to how to let people make pay money. Most critically, though, Twitter has its own ideas about how it wants to make money through other people paying money.

For more:

-See TheNextWeb story about Flattr
-See TheNextWeb story about Ribbon
-See Olsson's blog post
-See Twitter's terms of use

Related stories:

Hy-Vee Using Twitter To Do An End Run Around Apathetic Associates
New Theory About Visa's Investment In Square: Visa Really Is After Twitter
Starbucks-Square Deal Says More About Square Than Starbucks
New Square CRM Features To Create Loyalty, But Mainly To Square
The Square Mobile Conundrum: Data Goes In, But It Doesn't Come Out
 

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