Tuesday, September 29, 2009

Is Twitter worth a billion dollars?

"Twitter has reportedly been valued at $1 billion. As reported by the Associated Press (AP), a major investment into the company has boosted its value, despite it not yet earning significant revenue."

This is really in my wheelhouse because this was one of my former jobs - valuing private companies for large investments.

Let's look at Twitter: Loads of users and lots of traffic. No ad revenue and limited data mining (so far, but as Facebook has shown that's where the real money is)

However, I think twitter has been a little less than forthright with their new investors. Over the last month or so, as the company has increased talks with investors about this round of financing, the amount of twitter spam has exploded. Up to 20% of the network is now spam and in my experience up to 75% of new "followers" are spam artists. This is only my opinion, but I find the volume of spam so frustrating that I've abandoned twitter (the blog still feeds to twitter, but I don't use it).

Apparently, I'm not alone. Look at a sampling of recent tweets,

grabcocque: Twitter spam is ruining Twitter. Fix it, you @$!^.

gammawaves: Found 10 new followers, 8 of which sent the same tweets. Blocked them. But all that spam is so tiresome, I might give up twitter 'coz of it.

luthienrising: Went to look at a "trending topic" & found nothing but spam. Completely useless feature now

And this is just a sampling of tweets over a 5 minute period. Maybe Twitter will reassert itself now that it has closed it's round of financing, but the spambots are difficult to corral once they infect the host.

Twitter is often praised as being another shining example of American innovation. Well, a billion dollar company with no revenues that produces nothing....yeah, that pretty much sums up the 21st Century American economy.

Meanwhile, the Germans and Chinese race by us with new wind turbines and solar panels.

Cheers!

1 comment:

Anonymous said...

Your last tow paragraphs pretty sum it up. Wouldn't it be nice if a start up in northern New York that builds wind mills, high efficiency turbines for said wind mills and solar panels is valued at $1 Billion a year from now.....Perhaps I should twitter such wishful thinking.