Whitney Houston and the Power of Twitter

Before the mainstream media informed the world that Whitney Houston had died Sunday in Los Angeles, a relative of a woman who worked for the pop star posted the news on Twitter. About 15 minutes later, another tweet, also from a non-media source, circulated to a small group of friends.

Anyone who thinks that Twitter is just a social website for celebrities looking to self-promote has not been paying attention. Twitter’s ability to distribute news quickly in some instances has actually become part of the story. Case in point is its role in sustaining coverage of the political revolution last year in Egypt, and its tracking of the deadly raid on Osama Bin Laden’s compound in Pakistan.

Corporations have come to recognize the power of the tweet and many are spending more on advertising with the mini-blogging service. Twitter’s advertising revenue is expected to grow more than 80% this year, on top of the triple-digit growth it had last year, when ad revenue hit $139.5 million. The love affair with Twitter continues because corporations can immediately see how engaged Twitter users are by the number of tweets posted on a subject—a feature that likely will bode well for the San Francisco-based company when it decides to become a public company.

Within an hour of Houston’s death, at age 48, social media analytics specialist Topsy Labs reports, there were about 2.5 million tweets and re-tweets about her passing. Those tweets provided an outlet for millions of grief-stricken fans looking for a way to honor Houston, whose otherworldly talent as a singer often contrasted sharply with her assortment of personal struggles.

Turning to Houston’s music—at a steep markup

Naturally, many people sought comfort in Houston’s music, and turned to Apple’s (NASDAQ:AAPL) iTunes store and Amazon’s (NASDAQ:AMZN) website in search of recordings from her catalog. Within minutes her singles and albums were among the top sellers on both services.

But fan grief quickly turned to fan outrage after the price of Houston’s 2007 “Ultimate Collection” album increased 60% at the iTunes Store. Some fans claimed that they were prevented from downloading the album until the listing was recalibrated to reflect the price increase. Tweeters accused Apple and the album’s publisher, Sony Music (NYSE:SNE), of exploiting Houston’s death, although Sony Music was found to be the catalyst of the price increases.

The label reportedly increased the wholesale price because it may have been incorrect. Apple then raised its price because it is based on a fixed percentage markup from the wholesale price, although the company has since restored the album to its previous retail value. Still, both companies suffered black eyes over the incident.

It’s the age of Twitter, after all, and the inhabitants of Twitterland can do a lot to turn a business mistake into a PR headache.

Article printed from InvestorPlace Media, https://investorplace.com/2012/02/whitney-houston-and-the-power-of-twitter-aapl-amzn-sne/.

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