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This is the same faulty logic that's killed hundreds of web startups during both the web booms. Massive user base does not autotmatically translate into profit
by TomOfTTB 18y ago
This is the same faulty logic that's killed hundreds of web startups during both the web booms.
Massive user base does not autotmatically translate into profit. In fact, what a massive user base does do is to create so much cost in running the service that it's hard to find a way to make a profit.
Twitter's already $55 million dollars down which shows just how much it costs to run the service. So even if every one of Snoop Dogg's 25,000 followers were willing to pay a dollar (unlikely) and Twitter got all the profit from it the money wouldn't make a dent in the cost of running such a massive operation.
- siong1987 18y agoDo you have any example that web startups which had massive user base died during the web boom? But, I don't think that I have to show any startup example which had a lot of money but died during the web boom, right?
- whacked_new 18y agoLycos maybe? Excite? Go.com? (hit or miss)
- patio11 18y agoTwitter has one thing going against it that is virtually unique: costs are super-scalar to the number of users, whereas in almost any other content-based website they are logarithmic. The reason is SMS charges. Every user who signs up for SMS costs Twitter real cash money to service at the margin, and their cost increases as the size of that person's personal network increases. If Joe SmartPhone signs up to follow me on Twitter, every one of my status updates starts costing them money, too, despite the fact that I only use their web interface. There is literally no other web service I use that costs my provider a per-use fee, except my brokerage account -- and they, quite sensibly, pass that per-use fee and then some straight to me.