I imagine its a raise the money while people are offering it kind of thing. With twitter(as with facebook), its been a race to a business model and profitability, you have some money if you want to keep the lights on.
... also a race against time. You can only capture and hold people's attention by doing the same thing for so long. They will need to continuously evolve their product to attract new users and also keep existing ones. Twitter's valuation is based on their unrealized potential, not because they're a cash cow. Without funds to ensure continued, rapid growth, they'll never realize it.
Depends what potential uses you're referring to. If it's context-sensitive advertising, ICQ did have (has?) ads and supposedly could match an ad to a message text or a user's history.
It's still only traditional advertising, the thing about Twitter is it has the ability to make people forget they are bing advertised at. People follow company account on Twitter very willingly and receive a stream of what would be considered advertising from the company right mixed in with everything else they are doing.
The ICQ equivalent would be to have someone like starbucks open up a chat with users and still manage to somehow retain the users.
Fair point - but, this relies on the user actively using Twitter over some time, which seems like the minority. Couldn't companies achieve the same with Facebook pages, which seem to have a larger and more devoted audience?
Yeah, at the moment though Twitter has more potential in this area. They are seen as more of a broadcast platform whereas on Facebook the pages are tacked on to a platform for more personal communication between friends.
Certainly though I see this growing on Facebook to, I don't think there is only room for one game in town here though, so far companies have been happy to work across both platforms. Depends a lot on Twitters future user retention and engagement I guess.
Comments
Below is my tweet in reaction to the news. Hopefully someone can justify this growth capital for me.
I imagine its a raise the money while people are offering it kind of thing. With twitter(as with facebook), its been a race to a business model and profitability, you have some money if you want to keep the lights on.
... also a race against time. You can only capture and hold people's attention by doing the same thing for so long. They will need to continuously evolve their product to attract new users and also keep existing ones. Twitter's valuation is based on their unrealized potential, not because they're a cash cow. Without funds to ensure continued, rapid growth, they'll never realize it.
Seems to me Twitter's shareholders are doing the smart thing - converting transient hype for lasting cash.
Probably some cash out for the founders and very early investors. And some more dev. Maybe a lot more. Nothing to get upset about.
Lots of things compete with twitter (and beat it by miles).
Instant messaging apps - AIM etc do far higher volume of messages. IRC does. Facebook does.
Sure, it's not apples for apples identical, but can you imagine ICQ being valued at this price?
ICQ had low valuation because it was not popular in US. It had 2 reason for discount:
1. Users mostly international: Europe and Russia
2. Israeli-based - for two absolutely identical companies one in SFBA and one in Israel - the Israeli will have ~ 30% discount.
Question is, in the ~13 years since, was ICQ worth its $400m price? Is Twitter really worth x2.5 that?
Does ICQ have potential uses in the multi-billion dollar corporate marketing industry?
Depends what potential uses you're referring to. If it's context-sensitive advertising, ICQ did have (has?) ads and supposedly could match an ad to a message text or a user's history.
It's still only traditional advertising, the thing about Twitter is it has the ability to make people forget they are bing advertised at. People follow company account on Twitter very willingly and receive a stream of what would be considered advertising from the company right mixed in with everything else they are doing.
The ICQ equivalent would be to have someone like starbucks open up a chat with users and still manage to somehow retain the users.
Fair point - but, this relies on the user actively using Twitter over some time, which seems like the minority. Couldn't companies achieve the same with Facebook pages, which seem to have a larger and more devoted audience?
Yeah, at the moment though Twitter has more potential in this area. They are seen as more of a broadcast platform whereas on Facebook the pages are tacked on to a platform for more personal communication between friends.
Certainly though I see this growing on Facebook to, I don't think there is only room for one game in town here though, so far companies have been happy to work across both platforms. Depends a lot on Twitters future user retention and engagement I guess.
"Sure, it's not apples for apples identical"
It's not even apples for oranges, it's apples for penises. Volume is hardly a good metric for valuation.
> "Volume is hardly a good metric for valuation."
Right. Fashion is. This is a 'twitter is fashionable' valuation.