Why Twitter just bought a social media talent agency

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Social media star is an actual job title now, with so-called influencers raking in tens of thousands a month to craft tweets, Vines, and other content for paying brands. Twitter sees this activity and has decided it wants a cut: The company just bought Niche, a talent agency and analytics firm that connects some 6,000 top content creators with advertisers.

Now Twitter and its 6-second video-looping service Vine, where some of social media’s biggest stars were born, control the connection between creators and brands that want to make ads that don’t seem like ads. That means the company presumably gets a cut when popular Viners signed to Niche make clips for brands.

Vine doesn’t insert ads into your feed, but that doesn’t mean there’s no advertising on the app. The platform’s most popular users have signed on with Niche or other social media talent agencies (yes, those are a thing now) to connect with companies who will pay for content. A prime example is HP, which hired Viners to create clips using the company’s x360 Pavilion hybrid PC. Not only did the clips rack up millions of loops on Vine, but HP then strung the Vines together to create a TV commercial, getting even more bang for its buck.

“As more users and creators use different products as a way to share what’s happening in their world, brands are also looking to partner with those individuals in hopes of generating moments that resonate with the people they are trying to reach,” Twitter product management director Baljeet Singh said in a Wednesday blog post.

Twitter video vs. Vine

Niche and Twitter developed a close relationship shortly after Niche launched in late 2013, and that partnership—and now ownership—gives Twitter an advantage when it comes to attracting advertisers. Now the network can simply point to talent and say, “This person has millions of followers. Want to buy placement?” Vines are also embeddable and viewable within tweets, giving advertisers cross-platform promotional opportunities.

The Niche acquisition also brings Vine stars into the Twitter fold. Twitter has allowed Vine to grow as a stand-alone service with little overlap, and now that the network has its own native video creation tool, it seemed like the two services were starting to duplicate efforts. But Twitter CEO Dick Costolo has said that Vine and Twitter video are complementary services with different purposes—Vine encourages creativity, while Twitter will now enable real-time news to unfold visually. Costolo reiterated the importance of both kinds of video at the Goldman Sachs Technology and Internet Conference this week.

“Content creators want to go into an ecosystem, deliver great experiences to users and tell stories, and then make money from it,” he said.

Twitter is struggling to add new users, but with Niche, at least it can make money off its most popular ones. Costolo said there will be "more to come" on that front.

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