Twitter IPO is about innovation, advertising, Big Data and growth

Twitter's IPO is about a number of issues:

• Innovation. The service should not grow old with its user base. There has been some innovation recently (DM among non-followers, previews). It could use innovation to compete with Facebook, Instagram (via Vine), WhatsApp. The trouble is that Twitter by nature is a simple service, and hence innovation is more or less ruled out. Same as Netflix. (However, Netflix has passed a point of no return where it is quickly becoming too large to be overtaken by any competitor.)
• Advertising. So far, we have seen few formats (3), but when Google acquired YouTube, markets were equally skeptic over options to expand advertising on YouTube. Further, Twitter acquired MoPub.
• Big Data. Twitter sits on a ton of data. Apparently, tweets about TV shows make Twitter especially interesting to TV advertisers.
• Growth. Can Twitter accelerate?

Teleworking (and Web 2.0 and P2P) wil drive FTTH

Here at Communications Breakdown, a Fibre Ring member blog (see right), we are strong believers in the benefits of true broadband, i.e. FTTH.

Time for a reality check, though. Below are 5 issues that may be relevant for broadband, through the laws of demand & supply.

But make no mistake: they do not reduce the urgency to build FTTH (they may necessitate a long-term view and perhaps new business models). The lesson here is, I believe, that Web 2.0 may be hyped (from a broadband point of view) and that there are other important drivers (teleworking, telemedicine, etc.), apart from P2P file sharing, that still do not get the attention they deserve.

1. Demand
As Carlota Perez put it: the recent past is not a very good indicator for the future. In other words, high growth will not continue perpetually.
As the internet moved on from providing data and voice to being an alternative channel for video, traffic surged. Growth may continue into the foreseeable future, but there is no fourth 'packet type', after the familiar 'voice, video, data' troika.
Check out this discussion: 'The bandwidth explosion myth'.

2. Competition
Don't count the incumbents out just yet. Cablecos are known to launch aggressive campaigns in Dutch towns that are trying to build munifiber. The same is happening in Provo, Utah.

3. Innovation
Who actually uses all those apps? As a blogger, I try many of them, but I am reminded of this post on Dean's blog.
At the same conference where Carlota Perez spoke, the EC advisor Jean-Claude Burgelman came up with a range of Web 2.0 apps (YouTube, MySpace, Orkut, Flickr, del.icio.us, LinkedIn), but none was really new. It could have been a 2005 presentation.
The new Google knol project doesn't seem to innovate relative to a site like Squidoo.
TechCrunch already has a 'dead pool'.

4. Advertising
Ads are practically the sole business model (except for aiming for a Google takeover). In itself, that's OK (free radio and TV have the same). Ultimately however, this will prove to be a very cyclical source of income. Hence, in due course a huge shake-out is unavoidable. Remember how hard it was for Yahoo! back in 2000 and 2001 to diversify away from ads (display ads made up some 80%)? That will be even more so now, since newer generations have grown up to expect everything on the internet to come for free.

5. UGC v. the expert
Content increasingly comes for free. This forces content providers to aim for a share of different sources of income (devices, access, software, bundles, etc.). If everybody wants a piece of the pie, and there is no pricing power, everybody's slice will shrink.