4 ms·

Two words: revenue stream. Where Facebook succeeded and Twitter failed was 1) building and growing a massive, highly engaged subscriber base, and then b) monet

by zzalpha 10y ago

Two words: revenue stream. Where Facebook succeeded and Twitter failed was 1) building and growing a massive, highly engaged subscriber base, and then b) monetizing them. The reality is, Twitter's DAU growth YoY has flat lined at around 300M while Facebook is nearly four times that and growing steadily. Meanwhile, Twitter user engagement is somewhere around 3 minutes a day. Facebook? 10 times that. The result: Twitter's ARPU is around $6. Facebook? Over double that, just north of $13 (both US numbers). So while the media may love to mention them, my view is this is just a reality for the product. It's niche to begin with, and its focused on very small, bite-sized content that doesn't encourage prolonged engagement.

_pmf_ 10y ago
> Where Facebook succeeded and Twitter failed was 1) building and growing a massive, highly engaged subscriber base, and then b) monetizing them. Twitter only failed at b); its user base should be enough to generate a nice profit.
chetanahuja 10y ago
Wait... Twitter has about 1/10 the engagement of FB but lags in revenue per user by only a factor of 2? I might be going crazy but it sure sounds like you're making an argument for specialness of twitter here.
- venomsnake 10y ago
  Depends. If I spend 1 hour on FB - showing me 2 min of ads is easier. If I spend 6 minutes on twitter - with one minute of ads I am not only heavily monetized, but probably you are pushing my ad tolerance limits. FB could easily double their ad content and still be usable. Is that true for twitter?
  - bad_user 10y ago
    Do you actually spend 1 hour per day on FB? And lets not include FB's messenger, since that doesn't count. Seriously, what do you do for 1 hour per day? And don't get me wrong, because I've seen some folks spending a lot of time on FB, I've got at least one family relative doing it, but those are the losers that are IMHO only worth targeting by soda and beer companies.
    - venomsnake 10y ago
      Messenger counts because I prefer to do my chatting on desktop on their website (preference to use keyboard sized for humans not chipmunks). Also you have to somehow fill the time between 9 and 5.
- andruby 10y ago
  Maybe.. I'm in a different mindset when using Twitter than FB. I use Twitter somewhat professionally, to discover new tools, learn things, follow people that are relevant to my work. I use FB purely for my private personal life. When I see Twitter ads for SaaS offerings or software tools, I actually read them. On FB, I'm very good at completely ignoring the ads.
  - bad_user 10y ago
    That's precisely my experience. I've actually read Twitter ads because, what do you know, those ads are better targeted. For all the data that Facebook is said to collect, they actually don't have much on me besides friends I barely know, pictures of my child, some political rants and jokes liked. Twitter on the other hand has a list of people with which I share interests and they can do targeting based on that list. Which is exactly what they are doing and for me it worked. I'm actually amazed that they aren't doing better on paper.
Lxr 10y ago
So if I pay $13 a year to use Facebook they'll no longer need to collect my data for advertising?
- mtmail 10y ago
  I doubt it. You're paying cable television and still see ads. They'll always be companies willing to give Twitter money to be able to advertise to them.
  - jmngomes 10y ago
    But how much would cable cost if the individual channels didn't rely on advertising for profit?
- dragonwriter 10y ago
  If setting up and maintaining both as supported and fee-based infrastructure had no costs to Facebook and didn't hurt their advertising revenue per ad-supported user, sure, that would be the case. In the real world, first, setting up and maintaining such a system would have substantial initial and operating costs (and possibly engagement costs, as it would complicate the UX), and, as opt-outs feom advertising would tend to be weighted toward the wealthier, more valuable (to advertisers), users, it would drop per advertising revenue per remaining advertising-supported user. So the buyout cost would have to be substantially more to break even.
- sjg007 10y ago
  They'll never do this.. it is way more profitable to keep your value opaque. The average user might be worth $13 but not you!

by zzalpha 10y ago

_pmf_ 10y ago

> Where Facebook succeeded and Twitter failed was 1) building and growing a massive, highly engaged subscriber base, and then b) monetizing them. Twitter only failed at b); its user base should be enough to generate a nice profit.

chetanahuja 10y ago

Wait... Twitter has about 1/10 the engagement of FB but lags in revenue per user by only a factor of 2? I might be going crazy but it sure sounds like you're making an argument for specialness of twitter here.

venomsnake 10y ago
Depends. If I spend 1 hour on FB - showing me 2 min of ads is easier. If I spend 6 minutes on twitter - with one minute of ads I am not only heavily monetized, but probably you are pushing my ad tolerance limits. FB could easily double their ad content and still be usable. Is that true for twitter?
- bad_user 10y ago
  Do you actually spend 1 hour per day on FB? And lets not include FB's messenger, since that doesn't count. Seriously, what do you do for 1 hour per day? And don't get me wrong, because I've seen some folks spending a lot of time on FB, I've got at least one family relative doing it, but those are the losers that are IMHO only worth targeting by soda and beer companies.
  - venomsnake 10y ago
    Messenger counts because I prefer to do my chatting on desktop on their website (preference to use keyboard sized for humans not chipmunks). Also you have to somehow fill the time between 9 and 5.
andruby 10y ago
Maybe.. I'm in a different mindset when using Twitter than FB. I use Twitter somewhat professionally, to discover new tools, learn things, follow people that are relevant to my work. I use FB purely for my private personal life. When I see Twitter ads for SaaS offerings or software tools, I actually read them. On FB, I'm very good at completely ignoring the ads.
- bad_user 10y ago
  That's precisely my experience. I've actually read Twitter ads because, what do you know, those ads are better targeted. For all the data that Facebook is said to collect, they actually don't have much on me besides friends I barely know, pictures of my child, some political rants and jokes liked. Twitter on the other hand has a list of people with which I share interests and they can do targeting based on that list. Which is exactly what they are doing and for me it worked. I'm actually amazed that they aren't doing better on paper.

Lxr 10y ago

So if I pay $13 a year to use Facebook they'll no longer need to collect my data for advertising?

mtmail 10y ago
I doubt it. You're paying cable television and still see ads. They'll always be companies willing to give Twitter money to be able to advertise to them.
- jmngomes 10y ago
  But how much would cable cost if the individual channels didn't rely on advertising for profit?
dragonwriter 10y ago
If setting up and maintaining both as supported and fee-based infrastructure had no costs to Facebook and didn't hurt their advertising revenue per ad-supported user, sure, that would be the case. In the real world, first, setting up and maintaining such a system would have substantial initial and operating costs (and possibly engagement costs, as it would complicate the UX), and, as opt-outs feom advertising would tend to be weighted toward the wealthier, more valuable (to advertisers), users, it would drop per advertising revenue per remaining advertising-supported user. So the buyout cost would have to be substantially more to break even.
sjg007 10y ago
They'll never do this.. it is way more profitable to keep your value opaque. The average user might be worth $13 but not you!