Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
"Twitter is over capacity. Too many tweets! Please wait a moment and try again."
I can't tell you how many times I've seen that message in the last couple of weeks. At high-volume Twittering times like lunch hour and the morning rush, the microblogging service simply can't keep up -- and throws its hands up in defeat.
The problem is obvious: Twitter kicked in the nitrous oxide a couple of months ago and has quintupled in popularity since late December, according to statistics from Google (Nasdaq: GOOG ) . Twitter isn't really making money yet, and its popularity has brought its server farm to its knees. Hardware is expensive. So is internet bandwidth, when you're dealing with millions of hyperconnected users.
I can think of a few ways Twitter can remedy this problem and return to the silky-smooth instant-broadcasting performance to which its users have grown addicted:
- Shovel more hardware into Twitter's data centers, which are managed by an American subsidiary of Japanese telecom giant Nippon Telegraph & Telephone (NYSE: NTT ) . This takes time, and NTT may not have the extra rackspace available immediately. And besides, how would Twitter pay for the new machines? Nope, scratch this idea.
- Move into a massive-scale hosting service like Amazon.com's (Nasdaq: AMZN ) Elastic Computing Cloud. Amazon has the hardware muscle and ultraconnectivity that Twitter needs, and EC2 can also be cheaper than having your own hardware. Sun Microsystems (Nasdaq: JAVA ) will open a similar service later this year, and other giants will probably follow, but that doesn't really help today. This one is plausible, but may require lots of reprogramming before Twitter's software will fit this new environment.
- Let some deep-pocketed sugar daddy with lots of Internet-facing infrastructure of its own step in and buy Twitter. Under the wing of Google, Facebook, or Amazon, Twitter could get back on its feet quickly, and go back to growing as fast as it might like. Lacking funds won't be a problem anymore.
Of all these options, Google buying Twitter makes the most sense to me. Google clearly has the traffic-handling muscle to handle anything Twitter's users might throw at it, and it's an established leader in distributing complex computing loads across a very flexible infrastructure.
Twitter runs on venture capital right now, having raised at least $55 million from firms like Benchmark Capital and Institutional Venture Partners. Those stakeholders would clearly want a large return on their investment, and Twitter might sell for as much as $1 billion.
Google is on the short list of potential buyers who could afford that kind of splurging on an exciting but revenueless business today. And that attitude is in Big G's genes, too. Microsoft (Nasdaq: MSFT ) would want a profitable business plan on the table first, and Apple (Nasdaq: AAPL ) doesn't buy much of anything. Cisco Systems (Nasdaq: CSCO ) is both rich enough and curious enough to do it, but seems more interested in high-bandwidth video services than lower-volume text applications.
Just buy Twitter already, Google. The little birdie needs your help.