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6 Reasons Why Twitter is the Next Friendster

The Twitter outage yesterday would have caused much uproar on the service had anyone been able to complain about it. Those in the media, frequently heavy users themselves (I include myself: @ErikSherman), poured on about the long incident. But I think that this was another in a list of prompts to ask a question: Will Twitter become the next Friendster? By that I mean will this particular attention magnate go the way of that one-time social network darling and fall into relative obscurity. Sadly, I think the answer is yes for a number of reasons:

  • Twitter has no business model -- I know this particular formulation sounds tired, but it is still relevant. No business can go on indefinitely without a way of making money. Yes, FedEx went years without profit as backers expected the real payday in the long run, and Amazon took its time to shift into the black. But there's a big difference between a FedEx or Amazon and Twitter. The first two were calculated risks that happened to need heavy capitalization in development, hardware, and equipment. With Twitter, there isn't a question of investment subsidizing the company until the business model works and revenue grows sufficiently to offset expense. Instead, the company doesn't even have a business model, or, apparently, any revenue at all. Right now it is nothing more than an experiment. I'm not suggesting that companies and backers shouldn't experiment, but if a venture is to last, it must exist in the real world. That means income.
  • Twitter is flaky -- On one hand, you could say that blaming Twitter for the DoS attack yesterday is unreasonable. On the other hand, customers don't care what caused an outage and they are unreasonable when they can't have what they want. And there have been plenty of times that Twitter has had operational problems all by itself. What other service-based undertaking has a nickname for the graphic that pops up when it isn't working? As it gains more attention and users, there will be more stress on its infrastructure ... and more temptation for hackers.
  • Users are fickle -- The turnover of users at Twitter is massive, with 60 percent of new accounts not being used a month later. Given that some people have multiple accounts and that spammers will use one account and then shift to others, I don't think you can rightly say, as many in the media have concluded, that only 40 percent of new users return a month later. However, even if the figure of returning people is somewhat higher, that still doesn't bode well. There are only so many potential users, and if too many leave after a short exposure, a company ends up hitting a market saturation point pretty quickly, meaning no more growth and, in short order, increasing decline. Think MySpace.
  • The 80/20 rule -- You want people to be engaged with a service. However, according to some studies, only 5 percent of Twitter users generate 75 percent of all messages and apparently almost a quarter of the traffic is created by automated bots (though not necessarily spammers). That's a way of saying that Twitter is dependent on the activity of a small number of users. Should they lose interest, the content that is the only hope of attracting people starts to go away.
  • Users are old -- I'm not knocking my and others' generations, but from what I've seen of online services, there is a youth factor that must come into play. MySpace only got big because teenagers took it up. Facebook only got big because teenagers took it up. And teenagers tend to be more active users, creating content and attracting friends, though they can be put off when older generations follow their lead. Basically, Twitter is overly dependent on a few old farts (myself included) who post on a regular basis. But such people can get distracted by issues that are more important to them. That goes back to the previous point. The service is too dependent on a demographic that can't necessarily promise fealty.
  • Companies are making money off it -- I know this seems completely ridiculous. You'd think that companies making money off a service would be good, because it helps drive engaged use. And that would be true were it not for the other factors. But between over dependence on a minority of posters and no business model to help ensure long term existence, businesses have to take Twitter with a shaker of salt. How can you treat a service as a strategic tool if you don't have confidence that it will be there a year from now?
The pressures on Twitter only increase, with 30 million users today and traffic growing at a scary rate. Unless the company finds a way to gain stability in business model, income, operations, and users, it will be heading to the land of the also rans.
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