Are Twitter and Facebook slow on monetization for fear of advertising?


The funny thing is that with all their growth, Twitter and Facebook haven’t made a damn dime yet — despite all the hemming and hawing about their influence, most recently in the Iranian post-election dramatics.

With their incredible traffic, there was a time when advertising would seem like a natural choice. Even though they are considered among the most powerful Web products, they seem to be missing monetization possibilities, if not outright ignoring them.  Twitter is trying “innovative” revenue streams like, maybe, TV shows.

Could it be part of the fear that advertising prices could be in trouble?

Because, of course, Facebook should be any marketer’s dream, as the most dramatic example of the power the Web has for data collection.

Recently, Facebook was valued at $10 billion, setting Twitter at $1.7 billion, but, without any real method of making money installed, the Wall Street Journal has questioned the valuation of the company to be, as Business Week reported, more than twice the market cap of the New York Times.

But, it seems it won’t be advertising, or at least that won’t be a primary strategy — something with which I certainly agree. So as they toy with new monetizations, I figure one of two things will happen, an enormous Web 2.0 bubble will burst or these two social networks will help lead us into a post-advertising focused world.

Am I missing anything? Does that make sense? Which is it going to be — will a $10 billion Facebook valuation seem laughable years from now or will this be a point in history where traditional display advertising will only be a secondary revenue stream?

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