Monday, April 18, 2011

Twitter Worth $10 Billion Dollars?

There are rumors floating around the online business world that Twitter is worth $10 billion dollars. That's because, apparently, Google may have offered that huge sum of money to buy the "microblogging" social media site. That's crazy, but here's what seems even crazy: the owners of Twitter turned the offer down!

If these huge valuation rumors are true, it comes as surprise to many, considering the fact that the vast majority of Internet users don't use Twitter and many don't even really know/understand what it is. In fact, it's estimated that Twitter really only has a relatively small number active users, probably less than 20 million worldwide.

Some experts believe that Google's interest in acquiring Twitter has to do with wanting to improve it's own "crowdsourcing" capabilities. Google has not yet had much luck with its own social networking initiatives and needs to figure out how to compete with Facebook on that front. Buying Twitter would be a very good start.

Many experts believe that much of online search is headed in the direction of social recommendation functionality. In the future, many people may tap into their social connections on sites like Facebook and Twitter for product recommendations before they even begin searching on computer algorithm-driven engines like Google. Buying Twitter may be a defensive move on Google's part, keeping it out of the hands of competitors like Microsoft and allowing Google to instantly tap into the huge spike in social networking growth.

We think: Twitter is a cool little messaging service that is kind of useful and can be fun to use for about 20 minutes a day. But unless it becomes a major communication/marketing platform we doubt it's worth $10 billion!

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