Communication is Still VERY Big Business
February 28, 2011
Elizabeth Supica, VP
While reading this morning’s headlines about investment banking firm JP Morgan’s desire to sink $450 million dollars into Twitter, a surprising thought occurred to me.
My thought was this: the idea of “monetizing” man’s inherent need and desire to communicate with one another is a relatively new concept. Think about it for a minute – the notion that a multi-billion dollar business can be created based on people sharing information, dates back less than 200 years. A drop in the bucket when you consider the length of time humans have roamed the earth.
Man has always felt compelled to find new and better ways to communicate with one another. In the early days it was drums, conch shells, and smoke signals. Those methods, although limited in distance and scope, worked relatively well for thousands of years. Thankfully, man’s desire for new and better technologies brought about the demise of these crude forms of communication.
Samuel Morse ( and subsequently Western Union) may have been the first to monetize communication services with his invention of the telegraph in the early 19th century. By 1856, The Western Union Telegraph Company was in full swing earning money from those dots and dashes traveling over wires from city to city.
Eventually Western Union specialized in sending messages via the written word (i.e. telegrams), a practice that lasted until just recently when company finally figured out that the demand for telegrams was virtually nonexistent.
at&t was the first billion dollar business created from communications services, mainly from long-distance communications early on. The at&t monopoly was eventually dismantled in the 1980s, but at&t still earns billions from virtually every facet of the modern-day communications industry.
Fast forward to 2011 and the Internet age, where billion dollar companies are seemingly created overnight. The entire social media industry is a product of only the last few years and is based entirely on – you guessed it – the need for us to communicate with one another.
Earlier I mentioned today’s news and the fact that investment bank JP Morgan is scheduled to acquire a 10% “minority” stake in Twitter to the tune of $450 million. That would put the value of Twitter at a whopping $4.5 billion! It is hard to believe how far we have come in 200 years.
I think Samuel Morse would be proud. Little did he know that his short message service built on dots and dashes would eventually come full circle to become short, 140 character “tweets”. To quote the old song sung by Louis Armstrong…”what a wonderful world.”