Twitter is the only social media tool that has proven itself in the business arena. While some tools have serviced niche uses for specific industries, Twitter's global appeal to business and the amount of value it adds are unmatched. The irony of this situation is that any attempt to recapture that value necessarily destroys it.
Let's do a little thought experiment. Let's say you run a company that makes broiled widgets. How much would you pay to know whenever a potential buyer anywhere in the world is in the decision-making process to buy a broiled widget? I'd be willing to bet you'd trade your CRM system and pay quite a bit for that qualified lead.
That's real value; and any company who delivers it deserves compensation for that value. Twitter delivers that value. Using any number of tools out there, you can mine the Twitter stream for people tweeting about broiled widgets. If a Twitter user is thinking about broiled widget purchases, chances are they are tweeting about it. In doing so, they are inviting you in to talk about your product.
Twitter derives this tremendous value from three factors:
- Twitter is a disinterested party
- The Twitter population lacks meaningful (in this context) sampling bias
- The Twitter population is large and growing rapidly
Unfortunately, any attempt to recapture Twitter's value destroys these factors that create that value.
The minute Twitter charges anything for Twitter—either directly through subscription fees or indirectly through API access fees—they do three things:
- You reduce the number of people willing to try the service
- You reduce the number of people willing to continue using the service
- You skew the population towards people who find more value in the service
The last impact is one that I think is the least talked about, but the most problematic. Currently, Twitter welcomes everyone—whether you find almost no value in the service or whether you derive great value from the service. The people who find great value in the service derive that great value from the presence of people who find little value in the service. Any kind of charges born by Twitter users will cut out a certain level of people who find limited value in the service. Without the Twitter users who find limited value to tweet their mundane thoughts, the service ceases to provide the same value to those who formerly saw great value in the service.
A lot of smart people—presumably including the investors in Twitter—have been thinking long and hard about this problem. I have seen a number of different business models evolve, including:
- Charging users to use the system
- Charging tools vendors for API access
- Charging for advertising
In the end, the only business model I see being workable is something similar to Google Analytics. Google Analytics is a free service that Google can use to recapture value because it helps its users see the value they are receiving from the Google services like Google AdWords they pay for. I just don't see what that scenario is for Twitter. I hope they find one though; they deserve to realize value from the service and it would be a shame to see it disappear because they someday find they cannot afford to continue paying for operating such a valuable business.