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	<title>Velvet Howler &#187; profit</title>
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	<description>So much more than you wanted.</description>
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		<title>&#9733; Twitter&#160;Profitability</title>
		<link>http://velvethowler.com/2009/06/03/twitter-profitability/</link>
		<comments>http://velvethowler.com/2009/06/03/twitter-profitability/#comments</comments>
		<pubDate>Wed, 03 Jun 2009 21:48:58 +0000</pubDate>
		<dc:creator>Bryan</dc:creator>
				<category><![CDATA[entries]]></category>
		<category><![CDATA[profit]]></category>
		<category><![CDATA[Twitter]]></category>
		<category><![CDATA[web 2.0]]></category>

		<guid isPermaLink="false">http://www.velvethowler.com/?p=3547</guid>
		<description><![CDATA[<img src="http://www.velvethowler.com/wp-content/uploads/2009/06/twitter.png" alt="twitter" title="twitter" class="center" />

First off, I want to preface this post by saying that, in the long-term, I don&#8217;t think the Internet can be made &#8220;profitable.&#8221; This is because the medium itself is inherently opposed to profit-making: it can be done, but only at the cost of either a quick death (for example, Napster) or a slow death (MySpace) of whatever kind of service is being offered. I firmly hold to the idea that the Internet is a new, intellectual form of the &#8220;commons&#8221; and while the commons can be deterritorialized and reterritorialized by capital, that model can&#8217;t be sustained for what is essentially free (in that all information ought to be free).

That being said, I like Twitter. Although I had an account for about a year before I really &#8220;got&#8221; it, I now use it more than once every day and have found it mostly useful for interacting with people I know and don&#8217;t know. That&#8217;s also why I&#8217;d like to see Twitter remain independent: thus far, the Twitter team has provided a great service and it would be upsetting if even a fairly humane company like Google were to buy it and turn it into a Google Ads farm. That&#8217;s also why Twitter should probably figure out a way to at least nominally turn a profit.

There are a few ways to do this. One is to take Facebook&#8217;s &#8220;flat tax&#8221; approach: instead of charging anyone, Facebook just inundates you with ads (in your profile, in your sidebar, as&#8230;]]></description>
			<content:encoded><![CDATA[<p><img src="http://www.velvethowler.com/wp-content/uploads/2009/06/twitter.png" alt="twitter" title="twitter" class="center" /></p>

<p>First off, I want to preface this post by saying that, in the long-term, I don&#8217;t think the Internet can be made &#8220;profitable.&#8221; This is because the medium itself is inherently opposed to profit-making: it can be done, but only at the cost of either a quick death (for example, Napster) or a slow death (MySpace) of whatever kind of service is being offered. I firmly hold to the idea that the Internet is a new, intellectual form of the &#8220;commons&#8221; and while the commons can be deterritorialized and reterritorialized by capital, that model can&#8217;t be sustained for what is essentially free (in that all information ought to be free).</p>

<p>That being said, I like Twitter. Although I had an account for about a year before I really &#8220;got&#8221; it, I now use it more than once every day and have found it mostly useful for interacting with people I know and don&#8217;t know. That&#8217;s also why I&#8217;d like to see Twitter remain independent: thus far, the Twitter team has provided a great service and it would be upsetting if even a fairly humane company like Google were to buy it and turn it into a Google Ads farm. That&#8217;s also why Twitter should probably figure out a way to at least nominally turn a profit.</p>

<p>There are a few ways to do this. One is to take Facebook&#8217;s &#8220;flat tax&#8221; approach: instead of charging anyone, Facebook just inundates you with ads (in your profile, in your sidebar, as &#8220;gifts,&#8221; etc.). It&#8217;s pretty annoying and I think it ruins the experience. It&#8217;s also probably one of the reasons why I&#8217;ve stopped using Facebook (other than its poorly designed UI and the idiotic influx of &#8220;quiz&#8221; spam I now see every few minutes).</p>

<p>However, the Twitter team has made it pretty clear that <a href="http://blog.twitter.com/2009/05/does-twitter-hate-advertising.html">they don&#8217;t want to take this approach</a>. Which is why I propose an alternative to the &#8220;flat tax&#8221; (really &#8220;flat ad&#8221;) approach: a progressive system. This would involve two components: (1) on registration, &#8220;public&#8221; (i.e., individual) accounts would be free, while &#8220;private&#8221; (i.e., corporate) accounts would require a one-time fee. This is because the very nature of a corporate account is fundamentally different than a public account: while a public account simply involves posting about day-to-day activity and things you finding to be interesting, corporate accounts would largely, if not implicitly, involve promoting that corporate entity. Hence, they should have to pay a fee to do that. This would also lower the influx of corporate spam.</p>

<p>The second component is the more important one. Currently, <a href="http://twitter.com/bryklaus">my Twitter account</a> has 58 followers and I&#8217;m following 51 people. On the other hand, <a href="http://twitter.com/APlusK">Ashton Kutcher</a> has 2,013,315 followers and is following 165 people. Now, both Ashton Kutcher and me have what I would call &#8220;public&#8221; accounts: certainly his isn&#8217;t &#8220;private&#8221; in the sense that it&#8217;s run on behalf of a company. Yet the difference between 58 followers and roughly two million is pretty big. Here is my suggestion: once a Twitter user has over, say, either 500 or 1,000 followers, they have to pay a monthly fee to maintain this number and the fee increases exponentially as the followers go up by powers of ten. While I can&#8217;t afford to have two million followers under this model, Ashton Kutcher certainly can. Moreover, this means that the top 1% of the Twitter node would cover at least 50% of the costs of operation, depending on how the fees are controlled. The other funds could come from the minimal ads on the right-hand column, as well as corporate accounts.</p>

<p>This model would have a number of benefits: it would help to monetize Twitter, reduce the amount of &#8220;EARN X MANY FRIENDS IN JUST A FEW MINUTES!&#8221; spam/viruses, and be a fair and equitable service without resorting to annoying ads for regular users. One of the problems I can foresee is that some might claim that the number of followers you have is out of your control, but I&#8217;d like to ask: are <em>you</em> ever really going to have more than 1,000 followers? If you think so or already do, clearly you&#8217;re someone who is at least somewhat notable. That level of publicity means that you should be paying for your account anyway.</p>
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