Tuesday, June 21, 2011

My Theory on how Twitter Makes Money

A lot of Cape Town People asked me recently "How does Twitter make Money" This is an open question. Twitter is ranked 9 in Alexa and yet there is no indication of any source of income on the site. Social Networks make their money from Cost per Clicks Campaigns (CCP) and direct Advertising. Yet the value of Twitter is more than 250 million dollar. (R1750M)The question raises...how does Twitter Make Money?

Twitter identify 50 staff, say at $150k each, plus say $5m per year server costs, so I'd guess they need about $12.5m per anum to run.

One thought that crossed my mind is that they are selling a share of a future sale price to venture capitalists, and living off that money. (This is speculation and not fact) It is also very suspicious that such a large site ranked 9th in the world do not run any ads, and can easily do so and generate Billions of US$ Could it be a government conspiracy or security measure to keep an eye on what's going on in the world. With a "one word search" say Bomb you can get all the info on the Bomb Twits and also it is available in all languages.

Twitter is also a social madness instead of being a social network. Imagine standing in an room filled with strangers and say your line. Then the next person says his/hers. This is way to Random so no topic can really be followed. People rush to the office or homes to see their twits...It's a social drug...

To come back to the topic on how Twitter can possibly make money.

Another theory that comes to mind is Hidden Ads

Try to search in Twitter for Microsoft. Your People search will be:(Example: Windows launches Office 10) Surely Millions of People will check it out and even Follow. That can lead to sales for Microsoft and Revenue for Twitter.
This can be one of Twitters secret tactics on hidden ads.

When Major Event Happens around the world, people post it to Twitter.
So Twitter gets the info much earlier than Google does, because Twitter is real time info whereas Google needs to crawl the news websites, etc. So currently, Twitter and Google have entered into a partnership to share data seamlessly. So Twitter MUST get revenue from Google...??

No comments:

Post a Comment