Comment by milesf
9 years ago
So to recap, Twitter exploded onto the scene in 2007, the "fail whale" appeared a lot, developers made all sorts of wonderful programs hooked into Twitter, the fail whale disappeared, Twitter started to destroy the app ecosystem, App.net launched to great fanfare in response to Twitter's knuckleheaded anti-developer stance, Britney Spears and Justin Bieber arrived and knocked all the nerds out of the top spots on Twitterholic, Donald Trump came and bludgeoned everyone with his bombastic prose, and now App.net is shutting down.
And after all this, Twitter still does not have a viable business model.
> And after all this, Twitter still does not have a viable business model.
...more pertinently, App.net didn't have one either - and they had an open API, charged real money and did all the things HNers' idealized version of Twitter would.
Right - it seemed at the time it might become e an idealized version of Twitter. My hope was that by having to pay money to get in, it would keep out the shills and noise. I was a paid member for several years but it became clear that none of the people I followed moved so it became a ghost town.
> My hope was that by having to pay money to get in, it would keep out the shills and noise.
Interesting. I'd expect something entirely opposite - with one platform, pay-for-entrance, shills / marketers can just write the entry costs off as a small marketing expense. OTOH I can easily imagine a lot of smart people with interesting things to say shying away from spending money on such a platform.
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Maybe because the reason people use twitter isn't because it is useful but rather because
Either:
It is cool. So we must use it.
Or:
Everyone else is using it so we must use it too.
Seriously:
140 characters? Feature?
Everyone can read everything? Feature?
The two biggest technical "features" of twitter can be arrived at by dumbing down either google+ or facebook 98%.
I consider "everyone can read everything" one of the most important parts of Twitter.
I wouldn't use Twitter if it was limited to people I already know, for instance.
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I have no idea why anyone even likes Twitter. Beyond broadcasting, there is nothing of value on it. Every tweet has absolutely inane replies. You can at least find some half-decent commentary in Facebook post comments, but Twitter is just insane babble
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You're forgetting that by the time app.net came up twitter was already "the" platform for this sort of stuff. App.net didn't improve on the model in any way. No awesome features, no additional value. It tried to compete with a service that's already used by millions with terrible branding (starting with the name) and a pricing model that's good for SaaS companies (because they work with business that use the solution to make money) with consumers (who don't).
Having a business model is nice. Having the right business model is essential. Twitter has a business model now, and while it isn't ideal it's in line with their type of product/company and if you scroll through some of the other comments this model isn't all that bad.
Twitter can improve it, but that's a story for a different thread.
Twitter finances (TTM):
revenue: $2.52B gross profit: $1.49B
It's only losing money because of stock grants.
> It's only losing money because of stock grants.
That's like saying "We're only losing money because we have to pay our staff"
They do pay their staff. Unfortunately the stock compensation was based on the … highly optimistic … story they told around the IPO about growing to be as large as Google or Facebook. Why spend prudently when you're about to be stupid-rich?
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Okay, but don't these stock grants substitute for salary? It's not like Twitter could just stop granting stock with no ill effects.
They pay pretty competitive salaries as well. The stock grants will eventually roll off as people's plans vest and are replaced with smaller ones(new employees have been getting smaller ones for a while already)
NYT story on the matter: https://www.nytimes.com/2016/09/27/business/dealbook/twitter...
TL;DR -- Twitter paid out about $680M in grants
Which is a lesson in how VC can easily destroy a viable, profitable business with a "money-chasing-money" strategy.
How do you figure that?
1) VCs own hardly any shared of Twitter[1]
2) Stock grants are used as compensation for people working at Twitter, NOT something that benefits investors (except in the sense people are working at the company the investors invested in I guess).
It's easy to blame VCs for everything, but I don't see how this makes any sense at all in this case.
[1] http://www.recode.net/2016/8/11/12417064/twitter-stock-owner...
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Twitter IPO'd over 3 years ago.
With the type and amount of attention Twitter maintains it has multiple, very viable business models. Notably advertising, data sales & company tools.
Also App.net charged money for use.
Did it? I remember registering lots of accounts just when it launched because I had a column in tweetdeck with a search that was something like "app.net/invite-code/" (all invite codes URLs started with the same pattern) so every time someone posted an invite URL I got a notification and I could register a new account ;^}
It was $50 per account when it first opened, you must have got in when they stopped charging (it was already dying out by this point) but used an invite system.
It was freemium. A free account with follow and storage limits and a premium at $36/year.
Yeah it's pretty ridiculous. Also, Twitter still has an anti-developer stance. For the shutting down of App.net despite Twitter's unchanged politics to make sense, I think it's because the Twitter model as a whole is dying (which obviously includes App.net and similar microblogging services). I hear Instagram and Snapchat is all the rage now. Ain't nobody got time to actually read text these days in the days of strongly social networkified attention spans.
I think we would all be better served if the blockchain could be replicated and tweaked to become a new public publishing platform that is the equivalent of Twitter today. Access to the blockchain would then become a function of clients who follow the established spec/protocol, analogous to browsers and the web today. There are a couple of startups that are already pursuing the idea, but I think that this could only become realistic if Twitter were to die.
Let's take all of Twitter's scaling problems and put them on a protocol design that's way more difficult to scale and optimized for entirely different access patterns and bandwidth requirements?
This seems like a entirely inappropriate application for blockchains. There are other more suitable P2P constructs we could create using similar ideas (which predated bitcoin) instead of jumping on a bandwagon.
Twitter has no issue making money: They made over a billion last year. Their problem is in growing: They have about the same users they had 2 years ago.
Maybe Twitter is fully grown. There will be some churn, but it's basically as big as it's going to get. With the current user base, they can generate billions of dollars in revenue.
The problem, then, seems to be with management and the board not understanding or maybe not accepting reality as it is. If they can figure out how to run Twitter with hundreds of people rather than thousands, they will have a great business.
I imagine they have fewer users than years ago -- I doubt they've been careful to remove _non-human-eye_ users from their MAU.
app.net never had the audience. Network effect is a real b##ch to overcome.