Twitter is going to triple revenue by 2014, but if you look beyond the numbers, you'll see it's nowhere near as well-positioned as LinkedIn
Let's address the basic data first. According to analysts at EMarketer, Twitter is on track to grow revenue from last year's $139.5 million to $540 million two years from now. LinkedIn's ad sales will come in lower, at $405.6 million in 2014, the group says, but that would still amount to 162% growth.
"Ad sales" is the phrase that matters most here. While Twitter is probably stuck with an ad-only strategy for now, LinkedIn has done wonderfully selling premium subscriptions to both corporations and job seekers. In Q3, the "marketing solutions" segment that does business with advertisers accounted for just 28.7% of revenue.
There's genius in how LinkedIn does it. Get users to post data about themselves and then collect the resulting information into new networks and tier pricing according to access level. Want to get a closer look at which fellow alumni work for a favored company? You can -- but you'll have to pay for a premium subscription.
LinkedIn has other uses as well. As an investment analyst, I use the network's built-in tools to follow company hires, departures, and popular links posted by employees. Were legendary investor Philip Fisher still with us, my guess is he'd call it a wonderful source of scuttlebutt.
You could say the same for Twitter, but only if you're willing to commit the extra time and attention required to cut through the noise. Facebook has a similar problem. Google
This is why you see the company charging hundreds monthly for premium access. CEO Jeff Weiner is positioning LinkedIn less as another social offering and more as a premium-data provider cut from the same mold as comScore
Do you agree? Disagree? Either way, it makes sense to study the new era of Web-based computing emerging around us. We can help. The Motley Fool has created a video tutorial entitled "The Two Words Bill Gates Doesn't Want Your to Hear." Watch and you'll not only learn the technology behind cloud computing but also get details of some of the best opportunities available right now. Click here to get started -- the research is 100% free for a limited time.
Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He owned shares of Google at the time of publication. Check out Tim's web home, portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.
The Motley Fool owns shares of Google and LinkedIn. Motley Fool newsletter services have recommended buying shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.