23 Apr 2009 9:58 pm   //   Filed under: Media, Technology

Sorry. Twitter will not save your newspaper.

In a blog post that got a lot of attention today, a media thinker named Umair Haque proposed that The New York Times buy Twitter and use it to bolster its online news products.

It appears Haque put as much thought into this idea as I would if I were a consultant who wrote a blog on the side: Not much. His plan is a recipe for disaster. Here’s why I think so.

Let’s begin with a really important fact. Twitter and NYTimes.com don’t make money and there’s no evidence either one ever will. Just because you have a lot of useful data, a lot of traffic and a lot of customer engagement doesn’t mean you have a business. Twitter has tens of millions of members but no revenue. (The company says the money’s coming, just wait.) Traffic at NYTimes.com is huge—it’s the most popular newspaper site in America and growing. Yet digital business is still a mere sliver of The Times Company’s revenue—and it’s falling. Merging Twitter with The New York Times Company would unite two black holes into which cash vanishes.

(The New York Times Company’s best hope is that print advertising will come back roaring once the economy rights itself. Twitter’s best hope is that some profitable company will buy it for reasons of prestige and keep it running at a small loss. I’m rooting hard for both of those outcomes.)

From what I gather, Haque thinks Twitter’s value is in matching customers with companies, so the two sides can engage in a conversation. My, doesn’t that sound fun for everybody. Like a trip to the Post Office.

But I can’t fault Haque for tossing out a ludicrous idea on a business blog, because at least he made me think. On my commute home today, I kept thinking, What exactly is Twitter?

Of course it’s a virtual community of people. But what is it as a business? It’s a communication service, like a utility. Yet it offers no billable services, no advertising, no merchandise, no events, no product at all. Its software is simple and easily copied. Its database is valuable, but not valuable enough (so far) to command a price.

I kept trying to compare Twitter to some other enterprise. What’s something else that employs a skeleton staff (Twitter workforce: 29), earns no money, has virtually no valuable property, yet is consumed enthusiastically by tens of millions of people? I thought about celebrities, or popular music acts who don’t sell a lot of records, or political campaigns, or nonprofit organizations, or radio shows, or parks, or lighthouses, or drugs, or schools, or foods that doesn’t cost very much. But everything analogy I came up with falls apart. Not even other technology companies have achieved this level of success without a revenue engine behind them. (Even Wikipedia asks for donations.) In my limited scope of knowledge, there has never been a company in history like Twitter. Fascinating!

It’s easy to look at customer habits and conclude that newspapers are the past and Twitter is the future. But you’d be considering only part of the picture. Newspapers may be a dying business, but at least they’re a business.