Twitter, in a post on its blog, has acknowledged that it’s been having problems. It attributes some (not all) of them to so-called “popular” users that it says overloaded the system when they sent updates in too quick a succession. In other words, it was a tactical acknowledgment by the company of problems that have already been widely reported.
Of course Twitter’s most popular user is Robert Scoble, and as far as numerous successive posts have argued, he is the real source of the problem (prompting some not-unexpected foot-stomping on Scoble’s part).
I wrote about Twitter’s problem in a post last weekend and how they should charge for people like Scoble, Michael Arrington and myself for using their system so aggressively. Our use of Twitter benefits our businesses. Links to Scoble’s posts can drive traffic to his site or his videos, which in turn drives attention to his work and his employer. Same holds true for Michael and for me. On a more philosophical basis, it allows us to stay in touch with our readers, who in turn keep us in business.
Nevertheless, since common sense and paid services are apparently not part of this brave new Web 2.0 world, my idea didn’t play well. What was I thinking? Instead there’s this belief that Twitter, the ultimate tool of our collective narcissism, should be so lucky to have super users, that they are what make it popular with everybody else. I don’t subscribe to that point of view, but hey that’s just me.
For Twitter, the challenge of keeping the service going while at the same time fixing it to scale up is immense. Thankfully they have the money and what looks like the will to fix the problems. Will they? We shall see!
Update: The debate about Twitter rages on. Scoble met with Twitter team and talked about the various issues in a video interview. I got an email from Even Williams who is one of the founders of Twitter and this is what he had to stay:
We like the idea of charging for commercial use. That’s something we’ve been talking about for a long time (you can probably find my quoted saying that from a year ago). We’re just not there yet.
Given all different opinions, and other issues that have emerged, I have to reiterate that by charging the super users, I am suggesting that costs will bring in a sense of responsibility to the entire ecosystem. When there is no tax involved, there is no cost to having thousands of followers, or sending hundreds of messages. When asked to pay, heavier users will use the system responsibly.
I’m not sure that money is really their problem. Don’t they have something like $15 million in the bank?
An example based on 3 well-known journalists does not mean the bulk of the popular users now or in the years to come would be using Twitter for profit, like you do. Some people just have a lot of friends. Still I believe they would accept your voluntary donations 🙂
I’ve never really understood the whole “free” business model. All it ends up promoting are crappy services. I’d question anyone who wouldn’t want to front $10 for a service they use and like, and I’d question the business itself if nobody was willing to pay. I think those are metrics everyone should use. If a service isn’t worth paying for, is it really that useful?
@Duane Storey: Hmmm…. yes, well, Google is ostensibly “free” to the end user, yet millions of people can’t live without it. The advertising model has worked extremely well in their case. Same for YouTube, sort of. Twitter could certainly follow in their footsteps; in fact I’m betting that’s what will happen.
I wonder why Google didn’t buy Twitter. Could it be because their technology sucked?
Robert Scoble, and the super-tweeters for whom he’s set an example, such as Michael Arrington and Jason Calacanis, believe they should be allowed to run their businesses off of a free service. They pay for their blog hosting and bandwidth, they pay for their mobile phone bill, they pay for their travel expenses, but when it comes to Twitter, they think they should get a free ride. Scoble will keep proclaiming this, and Dave Winer will rationalize it, and people like Calacanis and Arrington will pocket millions of dollars while Twitter’s investors subsidize Mahalo’s and TechCrunch’s online marketing. These people should be paying not $5 a month, but hundreds of dollars a month given the real value they derive from the service.
Om,
On this I have to disagree with you. I don’t think other high Twittercount people like Kevin Rose and Leo Laporte should pay. Using myself as an example, I joined Twitter because of Leo’s comments on his “Netcasts.” He brought me to the service which increased its value to investors. If anything, Twitter owes Leo money.
If Twitter can’t resolve its infrastructure scaling problem, I’m sure there will be a dozen start-up eager to replace them.
@KEvin and @Juri
I think if you are using for twitter for commercial purposes you have to pay. I am all for forming a basic tier which could be enough for normal people with a reasonable set of friends who want to follow them on the service.
The infrastructure problem is directly correlated to the over use by super users, whether we like it or not. i don’t deny the company has problems and needs to rethink its infrastructure, but if they had taken steps like facebook-limiting-people to 5000 friends, it wouldn’t be facing these problems.
Clearly I am in a minority of one on this one.
Om, you’re not a minority of one, you’re part of the silent majority of tech users who know that there’s no such thing as a free lunch. My respect for you has gone up seeing you not pandering to the freetards unlike other journalists (see TechCrunch’s cocaine-addled anti-copyright screeds). People who truly love the services that web 2.0 brings them need to start championing the idea of paying for them, otherwise we’re all selfishly contributing to the upcoming bust.
I think the key takeaway is that if you love Twitter, you need to unfollow Scoble.
Do yourself and the world a service, unfollow Scoble.
An interesting one this. WOW! so much hype/focus/emotion about twitter.. with everything else going on in the world. But then why has twitter captured so much attention when there are other services like twitter out there? I guess it is a little like the Microsoft of old.. they got there first perhaps, and so have the user base. I actually like twitter for the immediate updating/interaction, and it sure has potential as a backbone service for commercial users..
MAYBE twitter could remain as is for personal users (say upto that 5000 friends limit) and then JUST MAYBE they could provide a commercial separation.. maybe called “TwitterMax” or “TwitterCorp” or “Twitter-FedEx” or something more intelligent! with a really nice “business” API/SDK. Either way, they could certainly provide a VERY useful business platform without the pomp and fluff individuals like. Of course they could certainly also CHARGE for this… and if it was essentially a separate infrastructure, would be a way to scale individually from the personal twitter version…
I’m still not sure about the whole “New Age” Web 2.0 languages though.. like Ruby etc… I cannot really comment as I haven’t used them, but of late those languages seem to be popping up in all the negative ways… I’m sure there are many pro’s and con’s, so I will keep on the fence for a while on that one!
If Twitter had a freemium model from Day 1 they would not be in their current state. For example, if people had to start paying extra to have > 5,000 followers (the same limit as Facebook), there would be a LOT fewer people out their with 10,000, 20,000, 30,000 followers. Why? Because people are cheap and they won’t pay for anything. Now it’s too late to introduce that pricing model so they are stuck with these “problem” (from a performance standpoint) accounts.
I personally think people have, in the rush for VC money, forgotten about solid business all over again.
The reality is that if someone isn’t willing to part with their money for something, it has no value. Advertisers do not want to have their brands around these players – I’ve seen plenty of panels where basically ad networks are called lazy and ineffectual, as well as edited, controlled content is what brands want and they will not invest in anything that endangers their brand. I was at one where they talked about how they fired every media planner who bought from an ad network… and people don’t see enough value to pay for these things themselves, so really, are they actually worth doing as a business?
Almost no one has built a service on huge communities and made it even come close to paying; but there are plenty of instances of folks getting less users but $5-$50 a head for something that provides real value.
Maybe I’m a contrarian, but this whole “get users and figure out the business later” for free services that take a ton of resources and don’t really have that high of a value proposition is B.S.
Om’s idea is the most cogent I’ve heard for monetization once they figure out the technical issues – if there is value, people will pay, or, what most likely will happen, the big guys will whine and go to something else free.
Om, you hit it on the head. It’s the point I’ve been making since we first met at Mesh in Toronto. Too much emphasis on “cool”. I don’t understand why people are afraid to make a buck from their efforts.
In the meantime, for every VC supported Digg, Twitter, etc., there are 1,000 start-ups that are starving because they refuse to charge and become “un-cool”.
That is nothing more than a sign of high-school insecurity. They’d rather go hungry than depart from the pack.
This is life folks. You need money to eat, drink and sleep. Your family needs money, as do your favorite charities.
Monetize or die a well deserved death.
Regards,
George
I’m certainly a believer in the freemium model for some cases and charging when appropriate. But, the problem with paid accounts, and especially with a small minority of paid accounts is that you then become possibly too tied to making the minority of paying users happy while neglecting the majority. For a service such as basecamp this is probably not a problem, but for a service like twitter, which is so public, it may skew their priorities. Perhaps just a cap on the number of followers/ees ala facebook would be the better option.
But should the cut-off point between free and pay be the number of followers/followees, the number of updates, or both? Barack Obama has many more followers/followees than Robert Scoble, but since he tweets relatively infrequently, he presumably doesn’t strain the system all that much.
@Om, @David: the problem with capping followers is that it would also slow recruiting new members. Again, using myself as an example, I joined Twitter partly to follow Leo. If followers were capped, then possible I wouldn’t have joined because I couldn’t add Leo to my following list. I think @Ontario may be onto the solution – maybe limit the number of Tweets/day. Of course, the real question is: is it really Scoble and Calacanis that are cuasing the problem, or are they only the tip of the iceberg.
As to the pay vs. free model – I think paid services will be swimming upstream. Paid services will have slower growth and therefore a much lower potential for big VC payouts.
@Michael,
Well, Google basically *is* the advertising model, and YouTube obviously fits under the umbrella. There aren’t a lot of other successful companies I know of that are purely advertising driven (and when I say successful, I’m talking about having a sustainable business model). I always use Flickr as a successful counter model — that is people are more than happy to pay to use the pro service because it adds real value.
The solution is a combination of tweets X followers = twollows. Once you get past a certain number of twollows, you pay. Otherwise, how long can people just use the service for free – and why keep offering the service?
Kevin, I disagree with paid vs. free. Once someone passes a threshold, it is likely in their best interest from either a personal point of view (communication device) or business point (marketing device).
Nothing comes for free. Either Twitter will implement a model or a buyer will. Either way, it is not going to be free forever.
The questions are two here:
1. Should people like Scoble pay for their extensive use of Twitter.
I think no. Power-users like Scoble did and do a lot to promote the service, his use still brings in users.
2. Should businesses pay for their use of Twitter?
That depends on what Twitter wants to be. If they want to be a basic messaging utility, charging businesses could stop adoption of Twitter with businesses, which would strengthen their position as the one and only messaging system.
If Twitter “only” wants to be a group chat, they can charge businesses, but businesses would lose interest in the service anyway.
But: Money isn’t Twitter’s main problem. Scaling is.
Without question, Om is right.
Above the twitter argument, this applies to all the new free web services
If you derive value from the service, you should expect to pay. Maybe you get lucky and some other revenue model is in place, so you don’t have to, but to claim that you should not pay is ridiculous.
We have the folk making their living off the coat tails of Web2.0 crapping on about services that do not have a revenue model. Then, they complain when they can’t get stuff for free.
Come on guys, some logic please even in 2.0 days.
(although charging won’t fix the issues at T…. it isn’t cash they need)
Om, I fully agree people who use a service more than others should pay and there should be limits for free accounts, just like Flickr or other services. The comment was more that this should not be based on what type of usage there is, commercial or non-commercial, profit-oriented or friends and hobby type.
And I don’t think any service should offer free outgoing SMS, like some have. This is something that really has costs involved and if someone wants that, they should pay. It still amazes that Google offers free outgoing calendar reminder SMS’s – they have spent a fortune on me without getting anything back 🙂
I can’t believe how entitled and irate some bloggers are about Twitter (and the angry, damning comments). It’s a free service, for God’s sake. It’s not like users are paying money and getting ripped off. I think too many people have become dependent on it and then throw a fit when it doesn’t work correctly. It’s an Internet accessory, if you’re doing serious business on Twitter, you’re making a terrible misjudgment.
Have we become such egoists that if we can’t tell everyone we know that we’re having a cup of coffee at Starbucks RIGHT NOW it constitutes an emergency worth ranting on a blog about? (awkward sentence but I think you get my point).