Twitter business model to present at OMMA Social
Today is the big day when I and three other hand-picked contestants present our Twitter business plan ideas at OMMA Social. As a refresher, here's mine: Twitter should offer a premium version for biz use, similar to Yammer. Create private networks. Charge based on # of users.
I've given this idea more thought, obviously, and fleshed out additional details. (If you recall, Cathy wanted these in 140 characters or less.) This is what I've come up with.
TWITTER BUSINESS MODEL
Twitter should offer a premium version of the platform similar to Yammer, but with a twist -- Twitter sells the service as an OEM solution. They license part of the application for use by third-parties like Tweetdeck and Twhirl as well as enterprise users. These third-parties resell the service to businesses and organizations based on either a per-user fee (per "seat" license), message volume or combination of both.
The essential ingredient is the ability to create private groups (an intranet) in which members can message others individually or the group as a whole. There would also be the ability to create sub-groups within groups (Departments, project teams, etc).
Why this model?
A premium services model offers several unique advantages to others, advertising and usage fee models in particular.
Advertising
An ad-based model is fraught with problems. First of all, it's, well, advertising. We all know ads have not bode well in social media. Click-through rates are low, CPM rates are declining and ads are interruptive. Our love affair with them ended long ago.
Usage fees
Charging users a fee is an equally bad idea. Twitter has been around for almost three years and has always been free. While hard-core users like me would be willing to pay a fee, I think a lot of people would be pissed off and defect to apps like Plurk. Certainly, it would dissuade casual users from becoming more active and will slow the growth/adoption of the application.
Why offer it as OEM?
The problem with Twitter creating something they offer directly to consumers is that no one uses Twitter's interface. (Not anyone who's been using the service for any length of time.)
Keep in mind, part of the problem faced by services such as Yammer is that they run independently of Twitter. Another profile/login is required and another interface is necessary.
The genius an OEM solution provides is that the premium functionality is built right into the client interface. Tweetdeck, for example, would be perfect for such an integration.
The other part of the "secret sauce" is that the wealth is shared (President Obama would approve.) Twitter wins by providing an OEM solution, service providers win by being able to monetize their offerings, and users win because they don't have to deal with ads or pesky usage fees.
So, that's what I came up with during the several hours on the plane from New Orleans to San Francisco. I'm sure there are other things relative to this model I"ve not considered. If so, please feel free to offer your suggestions. But, do so before 4:00 pm pacific time, because that's when the panel ensues.
