One Word why Twitter is Not Monetizing - Valuation
July 15, 2009 – 12:01 pm
Twitter has over 20 million US monthly visitors and has raised over $55 million in funding. Their revenue to date is approximately $0. With so much traffic, why is Twitter not monetizing their pages. It would be easy to do, Ron Conway gives 10 ways to monetize real time data:
10. Lead generation
9. Coupons
8. Analytics
7. CRM
6. Payments
5. Commerce
4. User authentication
3. Syndication of new ads
2. Content advertising and advertising context and display
1. Acquiring followers
Twitter’s valuation seems to continue to climb as they reach more users. Are they worth $150 million, $250 million, $1.7 Billion? If so, why is Twitter not monetizing their traffic? The possible answer, it would dramatically decrease their inflated valuations.
I believe Twitter is not waiting for the perfect monetization solution. They are waiting for the perfect acquisition partner. If they begin to serve ads, and the revenue is no where near projections, the valuation they are receiving today could drop dramatically. This “could” be a $5 billion market, but what if real time services can’t generate high enough RPMs (Revenue Per Thousand Page Views) to support such high valuations. Time will tell, but we may see a YouTube type acquisition of Twitter before we see any true innovative monetization strategies.
One Response to “One Word why Twitter is Not Monetizing - Valuation”
Brilliant assessment. The dream is probably worth more than the reality. It feels like 1999 all over again.
By Ellen Thompson on Jul 28, 2009