Twitter data leak suggests flaws in company model

03/13/2012 | Gawker · Inc. online (free registration)

Leaked data show that Twitter operated at a loss during 2010 and the first quarter of 2011, and earned about a fifth as much during 2010 as it had predicted. That shows the perils inherent in Twitter's strategy of amassing users before figuring out how to monetize them, as opposed to Facebook's profit-focused business model, writes Erik Sherman. "A difference in philosophy helps explain why Facebook has become not only dominant in its market but also positioned for future success with revenue and profit, even though it's only a couple of years older than Twitter," Sherman writes.

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Gawker · Inc. online (free registration)

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