Twitter as Utility – the reason Twitter can’t identify the killer business model

twitter-bird

“Twitter : One-to-many real time broadcast”

from Mary Meeker, Web 2.0 presentation, November 16, 2010

Twitter has evolved into an efficient online broadcast media that it was destined to be. In fact, Twitter has become a broadcast platform akin to any communication media – i.e. radio or TV. It’s a utility. It’s the reason why Twitter struggles with creating a business model.

Typical utilities charge for usage or bandwidth. Electricity is metered, TV air time is brokered. Twitter doesn’t have a business model in place that creates a simple to explain recurring revenue model They have tried advertising models, even pulled a Daily Deal model called @earlybird because its users apparently thought copying Groupon wasn’t in the innovative spirit of Twitter, but realized the social media doesn’t tolerate 140-character ads. I’m sure they have deconstructed every pay-per-use models like API usage fees or user subscriptions. It’s hard to even name an independent Twitter app that has a business model beyond the freemium model. If one evolved that made consistent money, Twitter would have copied it (for now they copy the functionality of other non-revenue models like Seesmic).

The business beneficiaries of Twitter are simply the brands (and everybody is essentially a brand on Twitter) who use Twitter as the most efficient means of reaching and communicating with a mass audience of even millions. No other social network does this as efficiently because they are either closed (Facebook) or too niche focused (Yelp). Twitter remains enigmatic among social networks.

About Pat Kitano

Patrick Kitano works with brands in developing hyperlocal engagement solutions and is administrator of the Breaking News Network, a national hyperlocal network devoted to community service. He is the author of The Local Network on Street Fight, and is reachable via Twitter @pkitano and email pkitano@gmail.com.