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I've commented on this in the past so here's the short version (long version here https://news.ycombinator.com/item?id=11077269 https://news.ycombinator.com/ite

by spangry 11y ago

I've commented on this in the past so here's the short version (long version here https://news.ycombinator.com/item?id=11077269 https://news.ycombinator.com/item?id=11077269): As heretical as these sound, I think there are only three ways for Twitter to generate significant profits (and they all carry significant drawbacks): - start charging for API calls above some threshold (i.e. charge for market research) - start charging commercial entities based on number of followers (or volume of tweets) - use adsense (better user data linkability) tl;dr - Twitter creates significant value. But it's difficult for them to capture at least some of that value as profit (unlike Facebook).

troels 11y ago
_use adsense (better user data linkability)_ The problem is that if twitter is stripped down to a protocol/platform, you can't really force ads in there. It's something that can be put in clients. That's what got them in trouble before.
- spangry 11y ago
  Good point. It's a bad example. In hindsight, what I was trying to get at in the third idea was slightly different to the other two. The first two are methods to capture some of the value they generate. But it's a risky proposition IMHO; when capturing value some of it will be destroyed (kind of like how taxation causes dead-weight loss). There's a possibility that the value proposition hits zero or goes negative, at which point Twitter is dead. The third, less risky, option would be to capture data in adjacent markets (probably via start-up acquisition). If they capture adjacent data that, when combined with existing holdings, the value they can offer to the 'money' side of their platform (e.g. advertisers, developers) increases more than linearly. At which point it's safer to 'tax' the money side of their market. Personally, I'd go for advertisers first: unlike developers, advertisers don't increase platform value for the other side of their market (users).

by spangry 11y ago

troels 11y ago

_use adsense (better user data linkability)_ The problem is that if twitter is stripped down to a protocol/platform, you can't really force ads in there. It's something that can be put in clients. That's what got them in trouble before.

spangry 11y ago
Good point. It's a bad example. In hindsight, what I was trying to get at in the third idea was slightly different to the other two. The first two are methods to capture some of the value they generate. But it's a risky proposition IMHO; when capturing value some of it will be destroyed (kind of like how taxation causes dead-weight loss). There's a possibility that the value proposition hits zero or goes negative, at which point Twitter is dead. The third, less risky, option would be to capture data in adjacent markets (probably via start-up acquisition). If they capture adjacent data that, when combined with existing holdings, the value they can offer to the 'money' side of their platform (e.g. advertisers, developers) increases more than linearly. At which point it's safer to 'tax' the money side of their market. Personally, I'd go for advertisers first: unlike developers, advertisers don't increase platform value for the other side of their market (users).