Another Great Life Stream On Posterous

“August 30, 2009
Why Twitter is underhyped and is probably worth five to 10 billion dollars

OK, this summer I’ve been to a lot of different places. London. New York. Boulder. Seattle. Hollywood. Los Angeles. Indianapolis. San Antonio. In each place it’s become obvious how much Twitter has taken over the world. In every city it seems like every business is drinking the Twitter koolaide.

The experiences I’m having with business owners in every city makes me understand some things:

1. Twitter has taken over the business world and this should be very worrying for other companies like Google, Yelp, Facebook, Microsoft, Yahoo and others.

2. Twitter is underhyped. I’m now convinced that Twitter has locked up a whole raft of businesses and that Twitter is actually worth five to 10 billion dollars.

3. Silicon Valley tech bloggers haven’t yet put together this pattern, other than by watching traffic numbers which continue to zoom up. Why? Because most of them don’t travel very often and don’t actually meet with real businesses like restaurants or like the Fiat/Yamaha racing team I’m hanging out with this weekend. When race fans and companies that serve them are excited about Twitter you know the world has shifted.

4. A new understanding of Twitter by businesses is now here, thanks to a raft of new books like Chris Brogan’s Trust Agents or Shel Israel’s Twitterville.

5. Businesses are seeing real ROI but aren’t sharing that publicly and, really, they don’t have much else that is working to reach the richest and most educated customers.

6. In each city there are a core group of Twitter evangelists that aren’t pushing anything else to their businesses. In Hollywood one of these evangelists, who wants to remain unknown so asked me to keep his name off of the blog, took me to a set where they were shooting Criminal Minds (you can see my interview with the director of photography here) and while there this guy told me why celebrities won’t use anything but Twitter. Other services are too hard for the celebrities to use, particularly from their mobile phones. I’ve been using the new Facebook app on my iPhone, but it has some severe limitations for businesses and celebrities which I’ll go into later. Because these influencers aren’t pushing anything else, nothing else will get adopted.

7. Facebook wants into this market (and so do others) but they aren’t understanding what makes Twitter attractive to businesses.

Anyway, this all leads me to understand that Twitter is way underhyped and is worth more in the marketplace than anyone has estimated yet. Now I totally understand why Ev Williams didn’t take the Facebook deal of about a half billion dollars.

“But, Scoble, I see low engagement scores on Twitter,” I can hear you saying. That might be true, but the businesses are seeing enough value here to continue pushing Twitter to their customers.

“But, Scoble, businesses are mostly spamming their customers on Twitter,” I can also hear you saying. That might be true, but enough businesses are figuring the right way to get customers in the door that word will get around about what works.

“But, Scoble, I thought you hate Twitter,” I can also hear you saying. I don’t hate Twitter, I just hate how they treated early adopters thanks to the Suggested User List and I think they are fundamentally misunderstanding how the market is actually using and engaging with Twitter. But they don’t care about me and the market doesn’t care about me either. Twitter has won and is winning big time with businesses. I don’t see that stopping anytime soon, so @ev and @biz just need to keep these folks happy and they will ride this train into a huge business.

“But, Scoble, I don’t see how Twitter will make money,” I can also hear you saying. Here’s the rub, when you have every business in the world hot and bothered about using your service, which Twitter is heading toward VERY QUICKLY then you’ll be able to make money. How? Charge for business services. I know businesses would pay for better analytics. Better hooks into their lead generation engines. Better team collaboration services like TweetRiver, which is what we use at Rackspace to manage our Twitter accounts. And more features. How much would they pay? Many businesses would pay a hundred a month, maybe even more.

So, why is Facebook screwed so far with businesses?

1. Facebook doesn’t have a way for you to track all mentions of your business. On Twitter if you write “@scobleizer” I will see it and be able to answer it. Facebook doesn’t have anything like that.

2. Facebook has even less permanence than Twitter does and that’s a low bar to crawl under (Tweets are only accessible for a few days on Twitter Search, while on Facebook once they roll off your home page they are nearly impossible to find).

3. Facebook has brand troubles. Most people like Facebook for its private features (my wife can send me and a select group of friends our baby photos, for instance but the newer public features, like fan pages, are misunderstood). If I were Mark Zuckerberg I would split these two usage models into two: one usage model that’s kept behind the privacy walls. Another that I would call “Facebook Public” that would be all the totally public features, including search and APIs.

Anyway, that’s enough free consulting for Mark Zuckerberg (it’s 4 a.m. here in Indianapolis) so let’s just end this by saying that Twitter is winning. Is winning big. Bigger than any of the tech blogs have admitted to yet. My new price for Twitter? $5 billion.

Tell me why I’m wrong.!”  Robert Scoble

Why Twitter is underhyped and is probably worth five to 10 billion dollars — scobleizer’s posterous.

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