Is Twitter Too Small?

Is Twitter Too Small?

Advertisers go where the users are, and right now within social networks that's Facebook . With Twitter preparing to go public, investors should remember that Twitter is significantly smaller than Facebook, which could present some challenges for the company to grab ad dollars from Facebook. Twitter's user base is about a fifth of Facebook's, and it generates less than a tenth of the revenue.

LinkedIn's registered user base is slightly larger than Twitter's, but the professional networking site has a different monetization strategy and so competes less directly. LinkedIn is growing its marketing segment, but its bread and butter continues to be recruiting. Twitter, Facebook, and LinkedIn all rely on network effects to drive their businesses, and Facebook is the clear leader within the bunch.

In this segment of Tech Teardown, Erin Kennedy discusses Twitter's size with Jamal Carnette and Evan Niu, CFA.

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Erin Kennedy owns shares of Apple. Evan Niu, CFA, owns shares of Apple and LinkedIn. Jamal Carnette owns shares of Apple and Facebook. The Motley Fool recommends and owns shares of, Apple, Facebook, Google, and LinkedIn. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.

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Originally published