The other day Twitter joined the ranks of companies that have gone before it in the tech sector and went public.
Yes, the company that introduced the world to #hashtags and retweeting has gone mainstream with an initial public offering (IPO) on the stock market.
Through the years tech companies have entered the stock market with a bang with some weathering the storm and becoming actual players in the market and others faltering and falling by the wayside.
It is of course too early to tell which one of those categories will best describe Twitter when all is said and done but history has definitely not always been kind to internet based companies.
With social media rather young in the grand scheme of things it is hard to put a price on how much owning a piece of the next great thing.
For every tech sector home run like Amazon and PayPal there are the forgotten fads such as MySpace and pets.com.
But while the world waits to see what fate ultimately befalls Twitter investors scooped up all of the shares that they could and the founders of Twitter became billionaires on paper overnight based on the value of their stock.
This of course is not too shabby for a company that has never turned a profit and sees the world in 140 character installments.
A few months back we here at Triple B joined the world of Twitter (@TripleBBrand) because a) we often find ourselves talking in 140 character sentences during the day and we wanted to share them and b) #everyoneelsewasdoingit.
During our time on Twitter we have followed a few news sources and learned a few things but for the most part Twitter has not really grabbed and held our attention the way we thought it would. #muchtodoaboutnothing.
The world of Twitter has also brought the need for rampant in game updates by journalists. While this is meant to tease their stories I would much rather wait for a fully formed story than to be bombarded by in game updates such as “Sources tell us @Ferguson just ate a burger on the sideline, says he is ready to reenter game #Spartanfansrejoice.”
So the news of Twitter going public has us wondering if that means that Twitter will suddenly change in some way to make it more exciting or offer new features to rock our 140 character worlds.
Ironically, I can be far more verbose in the world of SMS messaging on my phone with 160 characters to play with in my messages as opposed to the 140 Twitter allows. #Twittergotschooledbyalexandergrahambell
The business model for Twitter appears to be making money through advertising on “sponsored tweets” while allowing users to continue to tweet their hearts out for free 140 characters at a time.
While that plan may seem fine and good to some, the advertising major in me just does not see that as a sustainable business plan and feels that users will be asked to pay for the privilege of tweeting at some point.
It is like the old saying of the drug dealer giving away his product at first to get the audience hooked before jacking up the price once they are addicted. And there are certainly Twitter junkies out there from all the hashtagging I have seen in my short time in the Twitterverse.
I am of course not calling the fine folks at Twitter drug dealers but I fail to see how they can ever turn a profit by continuing to give their product away for free.
This is a debate that has been in the newspaper industry for years and is also why more and more mainstream newspapers are starting to charge for premium content on their websites since giving it away for free online was hurting their printed versions.
And while I do not claim to be an expert on investing what I do know about it is now that they are a publicly traded company most investors are all about the profit first and altruistic values second.
So the profits will need to roll in or investors will sell and those billions of on paper wealth will dry up. #heretodaygonetomorrow.
Now if you’ll excuse me, I feel the need, the need to tweet.
Copyright 2013 R. Anderson