<story><title>Twitter may receive formal bid, suitors said to include Salesforce and Google</title><url>http://www.cnbc.com/2016/09/23/twitter-may-receive-formal-bid-shortly-suitors-said-to-include-salesforce-and-google.html</url></story><parent_chain><item><author>briholt</author><text>Agreed on poor finances. But Twitter has one thing that no one else has - they are in the center of the zeitgeist. Every political candidate is on Twitter. Every news network discusses Twitter happenings everyday. NFL broadcasts list players&amp;#x27; Twitter handles. Half the commercials on TV advertise hashtags. South Park just did a whole episode about Twitter. The cost to embed your brand in the minds of Americans like that would be far greater than $10B. The question is can some larger company capitalize on that mindshare.</text></item><item><author>imagist</author><text>IMO, Twitter is the poster child for the tech bubble. They have users, which is their only claim to viability, but notably, they have &lt;i&gt;never&lt;/i&gt; made a profit. Currently valued at around $10 billion with 350 million active users, that&amp;#x27;s about $29 per user. You&amp;#x27;d be hard-pressed to find an investor so foolish that they would invest $29 in each of their users and hope to make it back if it were stated in those terms, but people have rushed to invest in a company which only has users, and whose attempts to monetize users through advertising have correlated strongly with loss of users. There can be little argument that Twitter&amp;#x27;s price has become entirely detached from its value.&lt;p&gt;That doesn&amp;#x27;t of course, mean you couldn&amp;#x27;t make money by investing in Twitter. You can make money by investing in overvalued companies as long as you don&amp;#x27;t hold onto your share until it busts. One profitable route would be if Twitter does get bought by a larger company. The market as a whole will lose on Twitter, but local maxima can be more profitable than the whole.&lt;p&gt;But at a personal level, don&amp;#x27;t be naive about this. A lot of people are investing, not just money, but time and energy, in Twitter or startups like Twitter. If you find yourself thinking that Twitter is a company with any real value, you should take a step back and evaluate whether you&amp;#x27;re being wise, or whether you&amp;#x27;ve fallen prey to the unbridled optimism of the tech bubble. Twitter&amp;#x27;s position as poster child for the tech bubble makes it a good litmus test for people&amp;#x27;s understanding of the industry, and I suspect it will correlate very strongly with who loses everything when the tech bubble collapses.</text></item></parent_chain><comment><author>skewart</author><text>This. Also, not only does Twitter have great brand recognition but also individual tweets can have far greater reach than Twitter&amp;#x27;s user numbers might suggest. A lot of non-users see Tweets - embedded in news stories, shared around the internet, or shown on TV. And lots of non-users hear about things that happen on Twitter.&lt;p&gt;That said, while that brand recognition and reach is scarce and hard to reproduce, it&amp;#x27;s not necessarily something anyone would want to pay a lot of money for. How would anyone monetize it? Twitter can&amp;#x27;t really control how many non-users see a tweet.</text></comment>
<story><title>Twitter may receive formal bid, suitors said to include Salesforce and Google</title><url>http://www.cnbc.com/2016/09/23/twitter-may-receive-formal-bid-shortly-suitors-said-to-include-salesforce-and-google.html</url></story><parent_chain><item><author>briholt</author><text>Agreed on poor finances. But Twitter has one thing that no one else has - they are in the center of the zeitgeist. Every political candidate is on Twitter. Every news network discusses Twitter happenings everyday. NFL broadcasts list players&amp;#x27; Twitter handles. Half the commercials on TV advertise hashtags. South Park just did a whole episode about Twitter. The cost to embed your brand in the minds of Americans like that would be far greater than $10B. The question is can some larger company capitalize on that mindshare.</text></item><item><author>imagist</author><text>IMO, Twitter is the poster child for the tech bubble. They have users, which is their only claim to viability, but notably, they have &lt;i&gt;never&lt;/i&gt; made a profit. Currently valued at around $10 billion with 350 million active users, that&amp;#x27;s about $29 per user. You&amp;#x27;d be hard-pressed to find an investor so foolish that they would invest $29 in each of their users and hope to make it back if it were stated in those terms, but people have rushed to invest in a company which only has users, and whose attempts to monetize users through advertising have correlated strongly with loss of users. There can be little argument that Twitter&amp;#x27;s price has become entirely detached from its value.&lt;p&gt;That doesn&amp;#x27;t of course, mean you couldn&amp;#x27;t make money by investing in Twitter. You can make money by investing in overvalued companies as long as you don&amp;#x27;t hold onto your share until it busts. One profitable route would be if Twitter does get bought by a larger company. The market as a whole will lose on Twitter, but local maxima can be more profitable than the whole.&lt;p&gt;But at a personal level, don&amp;#x27;t be naive about this. A lot of people are investing, not just money, but time and energy, in Twitter or startups like Twitter. If you find yourself thinking that Twitter is a company with any real value, you should take a step back and evaluate whether you&amp;#x27;re being wise, or whether you&amp;#x27;ve fallen prey to the unbridled optimism of the tech bubble. Twitter&amp;#x27;s position as poster child for the tech bubble makes it a good litmus test for people&amp;#x27;s understanding of the industry, and I suspect it will correlate very strongly with who loses everything when the tech bubble collapses.</text></item></parent_chain><comment><author>orblivion</author><text>Oddball idea: If all these news outlets, and other organizations, benefit from it, maybe they could finance it. The same way the Linux Foundation is sponsored by large tech companies.</text></comment>