Saturday, February 25, 2012

Why Twitter is Ridiculous & Will Never Turn a Profit

Tweet, tweet, tweet. Twitter has done a great job in one aspect. It has somehow convinced tens of millions of people around the world to create an account. All the big companies to small and in between, have also jumped on the band wagon. But the real question is why?

Twitter does provide some value like being able to tweet the happenings in Syria; the government has done everything possible to surpress accurate third party reports on the government massacres currently taking place.

Other than that, the best thing it does is allow celebrities to send asinine comments to their fans Charlie Sheen style. Recent example & real tweet from Charlie: "Georgia aquarium whale shark wishes Denise happy Bday!" I don't even know what to think about that tweet. But, apparently the almost 7 million peeps following Charlie's Twitter account feel that it's worth reading snippets of Charlie's mind on a daily basis.

In my opinion, Twitter is nothing more than a form of email to all the people that want to know moment to moment happenings and unfunny comments of people they want to be.

When I think about Twitter I also think that it is a type of email to everyone. As we all know, the days of having to pay for email were gone over 15 years ago. This leads to the main point of the blog. How will Twitter every profit $0.01 when their product is free and in my opinion rather petty and useless?

Advertising will make Twitter money right? Pandora banked on advertising too and they have just posted their first quarter of making $0.00 per share versus losing money. Moreover, Pandora has other products besides advertising such as the Pandora One premium service, and they collect royalties from every song they sell. And, Pandora actually provides a bad-ass service, that I use from my computer to the car, to walking around with my dog.

Does Twitter sell anything? Not right now at least. Yet, despite the fact that Twitter seemingly has no revenue let alone profits, Saudi Prince Walid bin Talal worth a paltry $22 billion USD invested $300 million in Twitter just two months ago. Now I'm sure the Prince has a bit more information on where Twitter is headed and how they eventually hope to turn a profit. It still amazes me that a web 2.0 company that has been around for 5 years, has no revenues, is losing money hand over fist, and seemingly only communicates the random and mostly idiotic thoughts of celebrities just received $300 million from what people hail as one of the smartest businessman in the world.

Will the gamble pay off? While I wouldn't bet against the Prince and his incredible track record, I am betting against Twitter. If Twitter can't manage to turn a profit or at least boast growing revenues, at some point mounting losses catch up with every business.

My take...Twitter is useless. What's yours?

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