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Exactly. This is dotcom bubble logic - we don't need an income stream, we have investors. Amazon ran a loss for a long time, but at every point in time, they

Exactly. This is dotcom bubble logic - we don't need an income stream, we have investors. Amazon ran a loss for a long time, but at every point in time, they were actually selling product and getting money. This Porter guy may say Twitter is wildly successful because they're a business that's not about such peasant concerns as making money, but of Amazon and Twitter, which is more likely to be around in 10 years?

gsmaverick 17y ago
The Amazon comparison is terrible. They were still losing money! Whether they are doing it by giving something away for free or by selling on ridiculously tight margins they are still losing money!
- gloob 17y ago
  The difference is that Amazon had a clear way to make money: make their revenue stream bigger. That doesn't and won't work for Twitter, because Twitter doesn't have a revenue stream to make bigger. Saying they're the same thing is like saying that the U.S. and Afghanistan are the same, because they both had elections. Well, true, but in one place the elections were not rigged, and in the other there's a good chance they were. "They still had an election!" of course, but there are significant practical differences.
- Semiapies 17y ago
  No, your attention to the issue is about a decade out of date. Amazon hasn't been losing money for years; they posted over $200 million profit for 2008. They had a working revenue stream, which meant that when they'd reached a point of sufficient growth, they had a slew of things they could reasonably adjust to achieve profitability. Twitter has no revenue stream. Twitter can't change prices or restrict spending to become profitable - it has no prices! They would have to actually create a business in order to become profitable.
RyanMcGreal 17y ago
They might have a top-secret business plan under which they grow to a certain critical size and then start earning money like crazy through a specific channel that requires critical mass to become viable, in which case more power to them. However, if they don't have a secret revenue ace-in-the-hole and their business plan is merely to get really big and then, you know, like, start thinking about how to make some money somehow...I certainly wouldn't risk my money on that.
- Semiapies 17y ago
  Neither would I.

gsmaverick 17y ago

The Amazon comparison is terrible. They were still losing money! Whether they are doing it by giving something away for free or by selling on ridiculously tight margins they are still losing money!

gloob 17y ago
The difference is that Amazon had a clear way to make money: make their revenue stream bigger. That doesn't and won't work for Twitter, because Twitter doesn't have a revenue stream to make bigger. Saying they're the same thing is like saying that the U.S. and Afghanistan are the same, because they both had elections. Well, true, but in one place the elections were not rigged, and in the other there's a good chance they were. "They still had an election!" of course, but there are significant practical differences.
Semiapies 17y ago
No, your attention to the issue is about a decade out of date. Amazon hasn't been losing money for years; they posted over $200 million profit for 2008. They had a working revenue stream, which meant that when they'd reached a point of sufficient growth, they had a slew of things they could reasonably adjust to achieve profitability. Twitter has no revenue stream. Twitter can't change prices or restrict spending to become profitable - it has no prices! They would have to actually create a business in order to become profitable.

RyanMcGreal 17y ago

They might have a top-secret business plan under which they grow to a certain critical size and then start earning money like crazy through a specific channel that requires critical mass to become viable, in which case more power to them. However, if they don't have a secret revenue ace-in-the-hole and their business plan is merely to get really big and then, you know, like, start thinking about how to make some money somehow...I certainly wouldn't risk my money on that.

Semiapies 17y ago
Neither would I.