Twitter valued at eleven billion dollars

2012 was the year that even God decided that Twitter was the hottest social media network. At least, God’s PR man, the Pope, signed up. 2013 is shaping up to be the year that Twitter finds out how much the network is actually worth.

Last year, the Facebook share issue had Wall Street and Silicon Valley agog, but the initial hype was swiftly overtaken by the harsh fiscal realities as the share price slumped. Initial valuations of the 140-character network seem similarly overexcited.

The figure being bandied about in Forbes magazine is $11 billion, which is a considerable leap from the August 2011 figure of $8 billion. Surely Pope Benedict’s Twitter feed can’t have made that much of a difference?

The papers seized on the new valuation, despite the company and tech analysts offering cautionary words. After the damp squib of Facebook going public, it seems there is still an appetite for the story of a tech company going from humble start-up to global giant.

The problem is that Twitter still hasn’t figured out how to make substantial amounts of revenue from its astoundingly popular network. While Facebook managed to rake in impressive advertising revenues in the lead-up to its shares issue, Twitter can’t even offer that enticement.

In a sign that it is getting serious about monetising the network, Twitter has hired a new chief financial officer, chief operating officer, and a design vice-president. It is experimenting with sponsored posts and other advertising streams, but there is no obvious golden ticket to improving revenue streams.

In the UK, Twitter users are already coming under tougher legal scrutiny, and the network’s days as a free-for-all community are already over. 2013 may be the crunch year that will decide whether Twitter muscles its way into the digital media mainstream or is sidelined as another enjoyable but fleeting media phenomenon.

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