Archive for July, 2009
Thinking Long-term
I love reading articles that question if Twitter is going to make money. It seems like everyone in the entire world has published a piece like that lately. I’ve even had, oh, 5-10 different people ask me how I thought Twitter would make money (maybe because I’ve always stated I thought it could be huge), though generally it’s asked in either an accusatory or skeptical tone.
Look, there are a lot of barriers to becoming a multi-billion dollar business with a sustainable, high-margin, defensible business that “prints money” (though Twitter seem to think it’ll build one). You can count on a hand or two the Internet companies that have done it. But I always find it humorous when a journalist who has talked to a few commentators, or a random person on the street who has thought about a company for a few minutes announces triumphantly that they don’t know how the product will monetize efficiently.
A few weeks ago, I came upon a BusinessWeek article that talked about a young, hyper-growth Internet company. It read:
But how will [the company] ever make money? There’s the rub. The company’s adamant refusal to use banner or other graphical ads eliminates what is the most lucrative income stream for rival [Internet properties].
It was an article that succinctly conveyed the popular opinion of the company at the time and made a number of cynical assumptions about how the company was ignoring some fairly common ways to make money.
And of course, the article was about Google.
Google. Current Market Cap: $138B
Now I’m not saying Twitter will be as big as Google or even that they’ll become *just* a large business. There are a ton of hurdles for it to get there, not the least of which is not stifling its growth by spending energy putting banner ads on twitter.com when so many of Twitter users don’t even use the website. But think about this:
- (Tens or Hundreds of?) Thousands of businesses are already using Twitter for customer service, PR, and marketing.
- Hundreds of thousands of businesses are wondering how to use Twitter to get their message out more effectively. They’re trying new things and clamoring for better tools.
Now if you can’t think of a way to make money in an environment like that when you’re sitting on top of one of the fastest-growing Internet properties in history, then you’re either not thinking hard enough or… worse.
As a Twitter user, I’m glad they’re, as Jeff Bezos said in video yesterday, “Thinking Long-term.” Now if they’re still not making money a year from now, well… good luck to them
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(As an aside, it’s fitting that the Zappos CEO happens to be one of the best examples of using Twitter effectively in business: http://twitter.com/Zappos)
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