Archive for the ‘Twitteriffic!’ Category

Twitteriffic! Why I am Bullish on Twitter (and Why it Shouldn’t Focus on Making Money)

April 14, 2009

Today, and the New York Times published features about Twitter. Not to be outdone, Kara Swisher published an interview with Twitter co-founders Biz Stone and Evan Williams on AllThingsD. All of these stories show how Twitter is becoming a platform that companies are building their businesses on.

This is the main reason I am so bullish on Twitter’s future. Silicon Valley home runs are all about platform plays. Whenever a company helps other companies make money, that’s when you have a potentially large winner on your hands. Think Microsoft (software developers), Amazon (online merchants) and Google (small to medium size publishers and other marketers).

As Twitter develops its platform, the next step for the company is to find standard monetization formats, and help automate the commercialization of the service, much like Google did with AdWords and AdSense and Amazon has done with its merchants program.

But unlike many folks who have been pressing Twitter to announce a business model, I don’t believe there’s an urgent need for Twitter to focus on making money. As a two-year-old company, Twitter SHOULD concentrate on product development and growth and core innovation. It’s too early to be maximizing for profit. The platform is still in its early stages of development and there are so many more users to sign up and the company has raised a war chest of capital to finance that growth. This bird just got its wings and is learning to fly.

Facebook, on the other hand, which is five years old, is in the typical stage of a startup where it should be shifting from growth to profit. Even so, it makes sense for Twitter to start thinking about business models since it takes a year or two to develop and roll out a monetization program. And that’s exactly what the company is doing now.

I will have more to say about the recent reports about Google and Twitter but first I wanted to get this thought off my chest. So keep doing what you’re doing, Twitter. It’s worked out pretty well so far. And I think it should get even better.