More than an acquihire: Cover acquisition is a test of Dick Costolo's product chops

By Sarah Lacy , written on April 7, 2014

From The News Desk

Back in October I wrote about the launch of Cover. Despite the fact I rarely cover product launches, there was something about Cover's contextually-aware launch screen that caught my eye.

Today Cover was acquired by Twitter and, although it's even rarer that I report on lame, who-cares, undisclosed-amount-of-money, will-likely-shutter-the-product acquihires, the deal grabbed my attention.

The reasons I was first excited about Cover, and the reason I'm excited about this acquisition are the same:

1. Timing. The founders are adamantly Android-first. As they explained in an interview last fall, that's crazy enough of a strategy that VCs originally didn't want to back them. And yet, Android is clearly becoming the dominant platform. As co-founder Todd Jackson told me last October: “We’ve seen so much data!” he says. “Path is the most iOS company you can think of and it has more users on Android. I just believe in the numbers.”

2. Talent. The result of being one of the only Android-first sexy apps? Winning at the tech world's zero sum game of developers, at least when it comes to Android. Cover has a killer Android team. Said Jackson back in October:

Android developers are (comparatively) the red-headed step children of the tech world. “Think of a company like Square or Path,” he says. “It must suck to be the Android guy there.” His message to them: Come to a place where Android is all we do. It may not convince someone to give up Square-like-equity, but any edge in hiring is welcome these days.
In a world where mobile is rapidly taking over social, that alone is worth the deal. Facebook has bought a lot with its $20 billion-plus spree of late, but not that.

3. CONTEXT! In a word, what is the one thing Twitter lacks? CONTEXT. I don't look at my Twitter stream in any comprehensive way anymore, because it's become an overwhelming firehose. And yet, I follow all the people on it for good reason. At some point, they'll Tweet something I want to read. But I don't want to read all their Tweets all the time. As Twitter becomes the place where real time conversations happen, context is going to be all the more important.

I'd kill for a smarter Twitter that got context and served up the Tweets I want to see from my friends. You could easily see what I tend to favorite or RT and do this. Or just see who I interact with most. I do enough on Twitter. Why can't this work better?

More important: Twitter needs this functionality to become more of a mainstream product.

Here's what I wrote at the time Cover launched, coincidentally:

What Cover’s founders get is the simple yet powerful use of context. I am constantly rejiggering what’s on my first screen, because different apps matter at different times. Cover knows if you are at home, so it shows you a picture of your baby on your lock screen and pulls up apps like Sonos, Nest, or, say, a baby-tracking app for easy clicking. At work, it may pull up Yammer or your work email. In your car it might pull up Pandora and Waze.
4. A nice little Facebook F-you: The Verge accurately noted in its assessment of the deal today that Twitter could well use the technology to launch a competitor to the failed Facebook Home, though it mused that since Facebook Home failed, maybe not. There's a crucial fact the Verge didn't note: The Cover team came from Facebook, where it gleaned many many lessons from what went wrong with Home. Again, from my previous interview:
Jackson was previously a product manager at Facebook, where he drew a lesson from what Facebook Home did wrong. It was too invasive, he says, taking over your phone and shoving Facebook at you. Cover itself, by contrast, fades into the background as it focuses on bringing your most beloved relevant apps to the forefront.
Point being: Facebook wasn't necessarily wrong with Home. They just can't seem to innovate for shit anymore. How delicious would it be if Twitter did it better? If you think the big blue bird doesn't have that in mind with this deal, you're nuts.

And here's where it will really be fun to watch: The knock on Twitter CEO Dick Costolo has long been that he has better managerial chops than product chops. After all, when he was named CEO, the company felt Jack Dorsey also had to come back as some phantom part-time product visionary, which wasn't sustainable long term. And, more to the point, Twitter hasn't developed much product-wise. In direct opposition to Facebook, that's changed more since the IPO with the roll out of things like better tools and little blue lines for tracking conversations.

That level of product innovation is nothing compared to what can now be done with the help of the Cover team.