

A Possible Solution to Twitter's Revenue and Spam Problems - shashashasha
http://blog.zachwaugh.com/post/29060660376/possible-solution-to-twitters-spam-revenue-problems

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Sodaware
Here's a stupid idea: let people buy "badges" that appear next to their name.
Kind of like "verified", but to show support for their favourite
celebrity/band/whatever. There are some pretty intense fanbases on Twitter.

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politician
That's a better idea than turning Twitter into Quora.

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grimlck
What that shows is how hard twitter's revenue problem really is.

To justify a $10 billion valuation on the public markets (not the bubble of
SV), they'd need to pull in $500 million of earnings. (Google's P/E is 19,
let's assume something similar).

$500 million is EARNINGS - e.g.: revenue minus expenses.

So, $14 million is just a drop in the bucket, they need to do something far
more ambitious than this plan to justify their valuation

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kaisdavis
Does Twitter have a revenue problem or are people angry that they weren't
consulted on how Twitter is making revenue?

I dislike ads in my stream and bad developer relations too. But the fact is
they're making revenue. That's cool.

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alanh
The blowback is that they keep clamping down on their API in a misguided
attempt to keep Tweets exclusively on Twitter’s properties so that more people
can be shown more ads.

No one has a problem with Twitter showing ads, but reducing access to our own
tweets and behaving less like a neutral platform are moves that irk a lot of
us.

Thoughts from late 2010: <http://alanhogan.com/twitter-betrayal>

And of course the whole app.net saga was somewhat motivated by these moves.

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PaulHoule
i think not misguided.

they pay very large bills to make their platform work and people who use the
API to make alternative clients are benefiting from this without paying.

No wonder Twitter is cutting them off.

Overall it is a dangerous choice to build a system based on a free API.

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alanh
It’s not just alternative clients. It’s LinkedIn, Instagram, various value-add
specific tools… stay tuned, it’s only getting worse.

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mayneack
What about the pseudo-anonymous accounts that would suffer from having a real,
subpoenable, credit card attached to them?

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spaghetti
Here's an idea that's only partially a joke: segment the user-base by yearly
membership fees. Have the free tier, $10/year, $100/year and $1000/year. All
tiers are 100% quarantined from each other.

There's upsides for Twitter: when 90% of my friends get the $100 plan there's
a huge incentive for me to do the same. When all of my friends keep the free
plan then there's no incentive for a loser like me to pollute the higher
Twitter echelons.

Might be some tricky cases where I follow a celebrity who has the $1000 plan.

I know these ideas sound ridiculous. However considering the mainstream nature
of these services and peoples' insatiable appetite for competition and one-
upping each other it could work out. The prices for each tier would probably
need some iteration to get closer to some global maximum.

Also I wonder if this could work for Facebook?

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pavel_lishin
On the other hand, if 90% of my friends sign up for the $1000/year plan, and I
cannot afford that, they just lost a user.

Would the people willing to pay a high amount make up for the loss of the
lower-tier levels? (Keep in mind that this is the kind of decision that you
cannot ctrl-z out of.)

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spaghetti
Good question. I wonder what a good strategy would be for figuring out the
near optimal pricing plan? The strategy would need to start off w/o painting
yourself into a corner. In other words the initial pricing can't constrain
future pricing adjustments by much. Also you'd want a strategy that allows for
frequent adjustment down the road. Something like the Google "search
algorithm" frequent tweaking.

Perhaps an increasing sequence of additional tiers could work? Start with just
free. Then free or $10. Then free or $10 or $25 and so on. This avoids users
feeling like they've been punished for being an early-adopter. Also users who
aren't happy with their current tier can simply upgrade.

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jastr
This is similar to a strategy to prevent email spam. Sender pays the Receiver
5 cents for each email they send, unless the Receiver has the sender in their
address book.

The Receiver can also after reading a message from a new email, choose to
waive the 5 cents.

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martinshen
Although this is cool. I doubt there will be traction as 15m revenue is no
where close to their neccesary targets. As app.net is doing. Twitter needs to
gen at least $5 to $10 per active user per year

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jonathanjaeger
$14 million/year is of little consequence to Twitter in the big scheme of
things.

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Robby2012
I don't think it's good idea, if celebs have premium accounts that means that
nobody can mention him/her? that's kinda stupid

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jbigelow76
Celebs wouldn't need premium accounts, they already have verified accounts.
Except in the most superficial of cases Twitter is a one way communication
tool for celebs, they talk we listen, it's a different tool for them than for
us the unwashed masses. Celebs that don't have PR flacks manage their Twitter
accounts probably have mention blindness the way we have banner blindness.

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Robby2012
didn't know that, thanks for the info!

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noelsequeira
This is an intriguing idea, but I see two fundamental problems:

1) Isolation through cliques can be a bit of a double-edged sword. While the
prospect of being able to battle spam (and a wave of unsolicited mentions) is
probably immensely appealing to the 1%, altering the fundamental contract on
which the protocol is based is almost always a bad idea.

2) Even if this accounts for a non-trivial fraction of overall revenue, they
aren't going to stop pursuing advertising dollars. Which means that they still
need to own the stream. And that the third party client massacre will,
therefore, continue unabated.

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alanh
> _free users cannot @-mention paid users_

Whoa, not cool.

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mikerastiello
This should be an option that could be turned off if the premium user wishes..

It should also be set that if the premium user is following the free user the
mention would go through normally.

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manuelflara
I dont't know if it's a stupid idea or how much they could make with it, but
I've always thought it was an obvious business model to charge people who
reach a certain level of followers (say 1.000). They're clearly benefiting
from having a Twitter audience. And of course, charge more as the number of
followers goes up. If you dont upgrade, no more people can follow you.

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diego
The problem is that Twitter needs those users. A user with a ton of followers
is a hit: Twitter shows those followers to people who sign up and don't know
what to do. This is not the only hole in this idea btw.

By the way, I'm sure this thread will be filled with suggested business models
by people who have thought about it for five minutes, without knowing any of
Twitter's metrics. There are really good reasons why Twitter gave up and went
with ads.

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manuelflara
The thing is, nowadays, do you think any celebrity that frequently uses
Twitter would stop because they have to pay $1,000/year (or way more)? They
know it's a huge promotion channel for them. It may have been a bad idea in
the beginning, but now Twitter's huge.

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diego
Just run the numbers. For one, there are approximately 3M people with 1k
followers or more. If they charged an average of $5/month, many (most) would
simply not pay. A significant number of those people are international. Many
of them did not even try to get followers. Even if all of them paid,
$200m/year does not come close to justifying Twitter's valuation.

Trust me on this, Twitter doesn't want to mess with the head of the
distribution. The backlash would be terrible, and it would destabilize their
ecosystem.

