How is Twitter going to make money?
How is Twitter going to monetize the service?
Can anyone explain to me how Twitter wants to make money? Do they have a business model? Right now Twitter mania is growing like crazy, the site is inaccessible from time to time and the number of users is just skyrocketing. And all this hosting and traffic bandwidth cost money. I think that some of the latest manias on internet resemble stock exchange markets in the final stage of a bull market. After a climax comes the crisis and the value of stocks is dropping down rapidly.
Isn’t twitter a bubble? That will burst and make all the blind investors realize they got nothing? Apart from really amazing career of Jack Dorsey, the founder of Twitter who keeps on rejecting higher and higher offers for the service, no one else is the winner here (from inverstors’ not users’ standpoint). This guy rejected the initial offer to sell the rights for 1 million dollars and now the bigest players of the market like Apple, Google and Microsoft are offering up to 700 millions for it! How are these guys going to monetize it? How are they going to make money online? These numbers are so high that it takes hell of the strategy to have the expenses covered.
I know Twitter is rejecting the idea of showing ads on their website. I know that they plan on introducing some paid features lateer this fall. But it all at this moment is only hypotetical. It reminds me of a Facebook mania back in 2007 when it was the number one portal in media. According to some absolutely horrendous estimates it was worth 15 billion dollars! You don’t believe it? What about Microsoft buying 1.6% of shares for 240 million dollars? Do the math… But after a year these same industry guys were saying that Facebook is worth only 5-7 billion dollars. A bit less, isn’t it?
So the Twitter’s case reminds of Facebook’s case. Everybody is going crazy about its value, but no-one knows how to get money from service. Let’s wait and see what happens, shall we?
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