May
21
(2008)
Twitter’s been flakier than usual this week, and supposedly the twitgineers are busy fixing database borkage and scaling stuff up and twiddling bits and furiously adjusting the machine that goes PING!
And yeah, they’ve had investors temporarily filling bank accounts to pay for the lavish web 2.0 drug binge parties development of a more robust and scalable nanoblogging platform.
But… Where is the money really coming from? It’s not advertising. It’s not subscription fees. The only other reasonably viable option is that they’re building it up to hope to sell it to some web 2.0 behemoth. And I can’t see why Yacrosoft! would pay $millions for it. Or anyone else, for that matter.
So, where will the money come from to pay for the server farms, pool tables, and cocaine parties growing workforce?
Twitter’s been a pretty stellar example of the power of community momentum. Even though the software is technically and demonstrably inferior to its competitors. The Twitter community stays put because nobody wants to be the first rat to jump ship, in case it doesn’t sink after all. Twitter works JUST well enough, and JUST often enough to keep us all coming back. “maybe it’s working now… how about… NOW! hmmm… now? or… now? YES!” The power of intermittent reinforcement in action. And none of the alternatives are dramatically better - they all suffer the same lack of clear business model that reeks of profound inability to scale sustainably.
A viable business model doesn’t look like this:
So where do we go when Twitter collapses?
I think I’ll have to fire up my Amiga and light up the old BBS server…
I’m militant against the abuse of the term business model. Companies have business plans not models
Way back, I remembrer Ev saying that one source of income might be partnering with the mobile networks on getting a cut of rev. on SMS send to/thru twitter, but maybe that was just to offset the cost of sending the SMS messages into the mobile networks — it sounded like a very real, very significant cost.
What usually happens to bubbles?
@lloyd point taken. so… what’s their business PLAN then?
People are NOT going to pay for it. They’ll rail against advertising. Unless they sell the content to Google or similar to help teach their search engines by mining the data, I’m not sure how anyone could “monetize” (another word I hate) the service.
@AJ been there. done that…
Looks like the network effect rears its ugly head once again. That’s the problem with services that build value from number of participants: it’s hard to be successful, but when you are, you have a lot of inertia (I’m looking at you, Microsoft Windows).
George Siemens posted recently about how early tech adopters are investing their time and energy, hoping to get a return when the technology catches on a network effects start to snowball. The key, though, as AJ points out, is that this trying to predict what people are going to fancy is a pretty unstable business. With several high-profile departures from Twitter, we’ll see if this snowball melts as fast as it grew.
the whole point of Twitter is that it’s not about the high profile people - it’s about the rest of us waaaaay down the long tail. I don’t follow any of the high profilers. I avoid scooby like the plague. Twitter might be better off without them. But the inertia problem persists…
And, oh yeah:
@Lloyd: Why the hatred of “business model?” According to Wikipedia, In this and and other sources, it seems to me that model is general idea of what the business does and how they make money; from that perspective I reckon D’Arcy used the term correctly.
I’m not particularly knowledgeable in the realm of business, though, so feel free to steer me to better sources if I’m mistaken.
I always figured a business plan would fit within one or more business models, but have never written either so also figured I was missing something
I agree that it’s about numbers, not about celebrities. If the A list bloggers leave, it’ll just help the bandwidth and it won’t bother me at all. All I need to think about is what service my peers use. And if they get split across multiple sites (and although I don’t really want to think about this, they will soon unless Twitter shapes up), what aggregator am I going to use to preserve my sanity? FriendFeed or something better?
T-shirts, that’s it. They’re going to sell loads of Twitter T-shirts.
You’re right though - at the moment, what’s Twitter? It’s my network. If you guys all jumped to FriendFeed I’d leave to.
That ‘is it working?’ scene resonated with me - I was watching the European Cup Final on Wednesday (http://nogoodreason.typepad.co.uk/no_good_reason/2008/05/twitter-meltdown.html) and I like twittering while a game is on. But it was down, up for two seconds, down, up for a minute, down. It became a game in itself, like shooting through moving windows.