Twitter Loses Significant Local Audience in Cutting Off LinkedIn

Last week, Twitter shut off API access to LinkedIn, the second-largest social network and the most influential network for businesses. While most people view LinkedIn as a place to find jobs and to connect with useful partners and colleagues, there is also a thriving LinkedIn local community. Thousands of groups exist that are focused on different specific technology, business and social niches, defined by geography. In the purely hyperlocal sense of the word, LinkedIn is not like a Patch.com or a Foursquare. But, like Facebook, it is one of the primary filters though which people view social graph data. And social graph data, by definition, is local to some degree.

Twitter framed this move, and a tandem warning to third-party developers to build experiences more like what Twitter does in its own UI, as the company trying to ensure that all users get the same wonderful Twitter experience. That’s understandable and, to some degree, justified. HootSuite, for example, does not feel like Twitter and its focusing on the enterprise market for Twitter management tools. But in my opinion, Twitter needs to tread very carefully in this arena.

As the company ramps sales in advertising, it needs to continue growing its user base and continue growing awareness. The best way to do this is to ensure that Twitter feeds can be consumed easily, in any platform. Unfortunately, making Twitter consumable everywhere in every format almost ensures that some of these formats may not conform tightly with Twitter’s own goal for its UI. And the entire ecosystem for social depends heavily on fluid usage of APIs and the free flow of data.

This is particularly important for hyperlocal, where obtaining critical mass of information flow and social graph engagement is harder because it is atomized and spread far more thinly over a wider geographic area. And its even more important on mobile, where hyperlocal is even more hyper and local with the importance of ad relevance drilling down to a zipcode and a block rather than a relatively wider area.  As Twitter tries to ramp its mobile strategy, I would think they might be better served by maximizes the ways that people can consume Tweets on a mobile device.

Lastly, a point to consider – B2B marketing on mobile is quite early. But LinkedIn is probably the best venue for this arena in the SMB sector. And certainly LinkedIn will build out a mobile play that incorporates ads as its mobile user base continues to grow. This could actually be a very natural advertising partnership for the two companies.

So to summarize my thoughts here: walled gardens, in general, are bad in industries where network effects are essential. With the exception of Facebook, no single social network has the critical mass to grow into a huge company. Twitter is growing nicely towards $1 billion in ads but I think it risks leaving plenty of growth on the table by starting to push partners away. I empathize with their desire to control the user experience. It’s a valid concern. Unfortunately, its something that a hardware company like Apple can do a lot more easily than a platform company which relies on distribution and interaction than on a specific UI for success.

Alex Salkever is an executive at a cloud computing company and a former technology editor of BusinessWeek.com. The views expressed in his column are his own and not those of his employer. His Personal Fight column appears every Wednesday on Street Fight.