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Why Apple-Twitter Team-Up Talk Fascinates

Monday, 30 Jul 2012 | 2:24 PM ET

The New York Timesreport that Apple and Twitter have had talks about some sort of financial partnership has generated a ton of buzz.

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Apple

Though there’s no indication a strategic investment is in the works, the two companies work closely together, and any talk of Twitter and Apple deepening their relationship continues to fascinate.

Why? It speaks to two major issues. First, Apple needs a social strategy. Second, Twitter is increasingly powerful as consumers shift from their desktops to mobile devices.

Apple CEO Tim Cook has admitted that Apple needs to be social. That doesn’t mean owning a social network, but it does mean making its gadgets social.

Apple has taken great steps to do this, especially after its Ping social music service fell flat. It continues to deepen its relationship with Twitter, integrating its service into its iPhone, iPad, and even Mac computers. And though attempts to build Facebook into Ping didn’t pan out, just last month Apple announced a deal to weave Facebook into iPhones.

Apple needs Twitter — it has more than 140 million monthly users, with massive traffic and “stickiness.” Consumers are shifting from iPods and laptops — where content was king — to smartphones — where social connectivity matters most. The bottom line: Easy access to Twitter and other social services may become just as important as content like iTunes’ was in driving consumers to devices.

And Apple and Twitter are natural allies as the other Silicon Valley giants make big bets to capture this same mobile audience. Google purchased Motorola Mobility and is building phones. Microsoft has its strategic investment in Facebook, which launched its App Center to rival Apple’s App Store. Even without a financial arrangement, deepening their current ties could be a win-win for Apple and Twitter.

-By CNBC's Julia Boorstin
@JBoorstin

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.