Only Dead Fish: Making Money From Social (2) Image courtesy I've lost count of the number of people who have told me that the problem with social is that you can't make any money out of it. Yet content owners and producers the world over continue to wrestle with what Scott Karp calls 'the 10% problem' - the problem that if you apply old school media principles to digital content you find that revenue per user is typically a fraction of the revenue per offline viewer, reader, or listener. Content owners aren't short of challenges: information wants to be free, content is ubiquitous, attention is the new scarcity. The old destination model said build it and they will come. Our content is good so people will come to us to consume it, and whilst they're here we'll throw a load of advertising at them. In this scenario advertising revenue is often a factor of scale - the more users I have, the more ad impressions I can serve and charge for, and audiences are homogenous - a user is a user, a reader is a reader, a viewer a viewer.
Twitter VC Laughs at the Idea that Twitter Has No Business Model - ReadWriteWeb. Todd Dagres, founder of Spark Capital and one of the VCs that poured an additional $35 million into Twitter recently, finds it amusing when people talk about Twitter’s lack of a business model. “We think it’s kind of funny,” Dagres recently told Innovation Economy. “We know how we’re going to do it, and we’re very confident about how we’re going to do it, and it’s not necessarily in our interest to tell people how we’re going to do it.” Dagres, who claims that Sparks and Union Square Ventures are the two biggest shareholders in Twitter, said that there is a business model – it just hasn’t been implemented yet. But he did provide one clue. Twitter To Start Charging Companies For Having An Account?
Twitter May Have Found Its Business Model - ReadWriteWeb. Twitter…what is it good for? It turns out this little service is good for a whole lot of things, despite the loud objections of people who’ve never really tried it. Even among true believers, though, it’s been hard to figure out how this much loved company is going to afford to stay alive. How will Twitter make money? A number of people noticed a new change made to Twitter today that could show just how it’s going to happen. Of course this is just speculation, but we believe it’s a pretty good guess that this could be what goes down. Selling Friends Professional hustler turned CEO Jason Calacanis spelled it out on Twitter tonight. Who says you can’t buy friends?
In order for this to work, Twitter is going to have to make these recommendations a lot more prominent in the user experience and it’s going to have to increase the quality of the non-paid recommendations. A Logical Opportunity Outside reports indicate that many Twitter users struggle to find friends on the service.