Watching the news last night and I saw a story on Twitter and its newly released IPO. To the surprise of many the amount of actual money losses is far greater than anybody realized.
Yes, Twitter has a lot of users, but they don't appear to make money, have any chance to make money or have a plan to make money. In fact, so far, according to their filing, they have lost a staggering 419 million. That doesn't seem to be a trend that is changing.
So, I wondered why that is? Is it simply a bad business model and practice? I am sure that is a part of it. But I think it goes deeper.
"It just keeps me up to date with, like, the stuff I enjoy most, so its just like, art, fashion, like..music more importantly."
"It puts your interests out there too. Like...hey, I am eating at X restaurant."
Those are direct quotes from the news item. From college students.
As the news item points out, Twitter has more than 200 million users who tweet more than 500 million tweets a day. But who are these people?
I have never used Twitter. My perception is that most of the content is fluff and is posted and responded to by those who are less than impressive when it comes to their level of education and ability to hold any kind of conversation, light or heavy. In fact, many of these kids are the types who should be studying a lot more and spending a lot less time on Twitter and their life prospects--and they money they have to spend because of that will reflect that. One of the subjects in the news story had 3 separate Twitter accounts. I suspect that is closer to the norm than the exception to the rule.
That is not to say that it is everyone on Twitter who is like that. It isn't. Many intelligent people are there and they have intelligent, poignant, witty and funny things to say. But they are the extreme minority.
Advertisers get this. The people with money, who ads are mainly targeted at, are not there. And wont be, as far as I can tell.
As noted in the news piece, Twitter is wildly popular, but not anywhere near being profitable, nor does it seem on any track to change that.
I have money. My friends have money and we are not there, nor do we have any inclination to do so.
Nor are we ever "like" ly to be.