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Twitting Money – Chapter Two

11 May 2009 by Stephen McNamara

About a month ago I blogged about the possibility of Twitter becoming a viable commercial venture for its owners. Back then I surmised that Twitter wanted it to be so, as did its venture capital backers who had pumped millions of dollars into the micro blog site with a view to recouping profit.

But I wasn’t sure. Twitter’s format seemed so limited that I struggled to see the commercial viability. Many companies have a Twitter presence. In fact figures now suggest that the majority of firms now have some sort of Twitter account. But is this just lip service?

Others have their doubts too. In its April edition EN magazine argues that Twitter does not offer the marketer anything new and that phone and email are still stronger communication tools.

Then there is the debate over the future of Twitter itself. New research suggests that after the first month Twitter loses about 60% of its new users. This attrition rate is much higher than for other forms of social media and it worryingly suggests that the rapid blogging site’s user numbers may be widely overstated.

There are many well know companies with Twitter profiles but these are set up as free accounts just as an individual would use the service. The do not represent income for Twitter.

So, as one commentator has stated, is Twitter trying to saddle the commercial horse after it has bolted out of the stable? If companies are happy to use Twitter as a marketing message board for free and with concerns over real user numbers, can Twitter really be effectively commercialised.

Maybe the venture capitalists backing the service also don’t really believe its commercial potential. Maybe they are just hedging their bets on someone like Facebook offering to buy Twitter for big money with its own misguided belief that it can generate revenues from Twitter!

So I remain unconvinced. Just because an online platform proves popular does not necessarily mean it will be commercial success. If anyone, the real winners are likely to be the businesses that use Twitter for free to post links back to their real online commercial tool – their own website.