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Yes, you read it right. If you don’t live in US, Canada or India, no more SMS updates for you! We know it’s horrible but true, as apparently it costs $1000 per user per year to Twitter for SMS costs. Instead of monetizing Twitter and providing better services to its users, we are seeing the demise of a quality feature.
The reason why US, Canada and India will continue to get updates is because Twitter has good relations with the cellular operators in those countries and it doesn’t cost them anything to provide SMS services to those users. This makes one wonder, where the funding went? There certainly hasn’t been any new feature or improvement in Twitter over the past time ( except if you call the reduced downtimes an improvement ). A lot of other services also used Twitter’s API to send text alerts to Twitter, so RememberTheMilk doesn’t look that attractive suddenly.
There have been mixed reactions from around the Blogosphere. MG Siegler of Venture Beat doesn’t seem to be moved by this
Look, SMS is great in that it connects so many people around the world. But the fees associated with it are an absolute joke. It’s a very small amount of data yet carriers seem to think it’s okay to charge an arm and a leg for it. In the United States, AT&T switched its policy with the iPhone 3G to no longer include any text messages in its plans for the device. Now, if you want to send messages it’s $5 for 200 of them. That is ridiculous when you already paying for “unlimited” data.
Don Reisinger of Mashable has pointed out that Twitter needs a business model ASAP.
And while I can understand where it’s coming from, isn’t this the perfect time for Twitter to wake up and establish a real business model? So far, the site has added users and paid millions to keep it running with nothing to show for it but some venture funding. And considering it barely escaped ruin after numerous downtimes over the past few months, now is the best time for the service to pull its head out of the sand and create a business model.
I agree with Don. Even after the last round of funding, this is what Twitter is giving to its users? Surely the downtimes were upscaling issues which shouldn’t have been there in the first place, but meanwhile they were fixed, was there no one in the Twitter team even thinking of a business model? Twitter is a golden egg waiting to be monetized. The lack of any experimentation at all for advertisement seems to clearly show this fact that they just don’t care. We’ve been watching Facebook making pushes towards monetizing it’s huge network as well as Google working on Youtube even thought it thinks it wont work. Twitter could have started experimenting with text ads to begin with and its placement. But so far, there hasn’t been even a hint of monetizing efforts from Twitter.
As Don said, the clock is ticking on Twitter. They have to start making money to keep their investors happy as well as provide better services to its users instead of providing feature cuts and downtimes. It’s about time to think about a business model, do you hear us Twitter?
The real question is: Who are the venture cap firms that are dumping cash into a company with no business model? I don’t understand that in the slightest.
There’s so much potential for monetization: location-awareness displaying local ads, ads related to “what you are doing right now” and similar interests. Those are two things Twitter can really leverage.
That being said, any of the venture cap firms who have invested in Twitter and are looking to get some rate of return on their investment want to hire me to put the pressure on Twitter?
How these companies get millions for non profitable business models is beyond me. I have profitable businesses and I don’t have people banging on my door to throw millions at me, I don’t get it, maybe I need to start associating with VCs I guess.