Twitter’s Doom
Twitter Inc’s decision to go public brings back the memories of Facebook Inc’s initial public offering (IPO) approximately a year and a half ago and raises the question of why Twitter would decide to do such thing. Twitter’s stock rating was issued “buy” from a brokerage firm before Twitter got public; this raised the hype and speculation that Twitter could almost double its stock price within a year. “Twitter’s planned IPO is one of the most anticipated since Facebook Inc’s” yet one must remember, that at the time, Facebook’s IPO was one of the most anticipated as well, and their stock price pummelled. Twitter, like Facebook, leveraged the fact that advertising agencies could invest in their social media platforms to generate more awareness. Twitter boasts impressive resources: it acquired online mobile-advertising group MoPub, has advertising alliances with broadcasters, capture global TV market with Amplify, keyword targeting, search capability, e-commerce, and mobile apps.
Although Twitter has similarities to Facebook, Twitter differs in the fact that it has steady streams of advertising and mobile usage by consumers. At the time Facebook launched their IPO, they were relatively premature in establishing the business-side of things; Facebook let themselves be influenced by the public hype. Twitter also has comparative advantages: Facebook positioned themselves first as the social-media platform to go public and Twitter can fortunately learn from the mistakes made by Facebook. Twitter also offers more value than Facebook due to their 140 character limit and spam filtration: unlike Facebook, Twitter has little-to-none spam accounts. Twitter isn’t the first social-media platform, but it positions itself in the mind of the public as the most personalized and user-friendly social-platform. Furthermore, it is of interest to note that Twitter has never made a profit, rather it remains in debt and that it is expected that Twitter to not gain profit from their IPO.
Read about Twitter’s Slowing Growth and Twitter’s IPO Demise.
Twitter gets ‘buy’ rating even before listing. Chandni Doulatramani. October 7, 2013.
http://www.theglobeandmail.com/report-on-business/international-business/us-business/twitter-gets-buy-rating-even-before-listing/article14722911/