Transcripts For MSNBCW The Cycle 20131107 : vimarsana.com

0 content like that they have on the service, the more valuable it will be for users and the more ads it will be able to show and more revenue down the line. all right, julia. great to see you. thanks so much. for more on twitter in 140 characters or less is business insider josh barrow. i m joking about the 140 characters. that s only for ari. i m up for a challenge. we know you are. but seriously, we need you to fill more time. twitter s ipo has seen a huge price hike. some might call that doing business in the open market. others are a bit more skeptical, including yourself. this is what you tweeted when an ipo is drastically mispriced like this, why don t the investment bankers involved in the pricing all get fired? josh, what s going on here? well, so the twitter ipo is priced at $26 a share, which is the price the insiders who got early access to the shares paid. all of the sudden today it s trading around $45 a share. that means the insiders at twitter who sold about 10% of the company got $1.8 billion for something the stock market is now saying is worth more than $3 billion. that s $1 billion that the people who own twitter just lost. these ipos are supposed to be set up so that the price pops a little bit on the day that the stock is introduced. you need to give the insider buyers who are taking all this time to learn about a new company to give them an incentive to do that. you want the price to go up 10% or 15. . you don t want it to go up 73%. when this happens, everybody gets overjoyed. they re like, wow, this ipo was great. when facebook had its ipo and the stock struggled to hold the price at which it was offered, people talk about that like it was a disaster. actually, the facebook insiders got as much value as they possibly could. even taking a step backward from that, if you re not on twitter and not investing, this is still one of those really interesting days in american life because i think what s good about our capital markets is that you can get access to early then it s expected to have twice as many sales next year as it has this year. it s pretty clear that within two or three years they ll be making money. the question is just how much money. but it is a good thing there are investors who are playing the long game here. in 2006 when twitter started, it wasn t at all clear how they could be profitable, but people thought this was a good idea that customers would want, then you d be able to figure out a revenue model for it and they have. let s dig into why and how twitter is going to be profitable because a lot of people, especially twitter users, are like, how does this thing make money? it s not like google where there s ads all over the place. advertising, of course, will be the main reason why they re going to be super profitable. some of the major tech folks are saying twitter is the most interesting company in advertising right now because of their recent acquisition of mo-pub, which is the world s largest mobile ad exchange. it s going to put them on the front end of two major trends. a major guy at twitter spoke about this. the rapid shift toward consumers using mobile and the industry shift toward programmatic buying so that the major trends in the ad world are going in twitter s direction. yeah, i mean, the main way twitter makes money is through promoted tweets. that s where when you load up your main page, you see a tweet some company paid to have put there. if you re tweeting about the iphone, they give you promoted tweets, either for competitors of the iphone, like from samsung and microsoft. because the ads can be properly targeted towards users interested in them, the advertisers are willing to pay more for that and the users may find that to be a valuable part of the experience. they re being shown ads for things they might want to buy. twitter also makes money by allowing companies to pay to have trends created. you can see on, you know, what s trending on twitter today. people are talking about miley cyrus or whatever. if you pay about $200,000, you can have your company s topic put in there and it s clearly marked as being something that s sponsored. they also make suggestions to you that are promoted. followers over there with me. it is somewhat sticky. as you well know, josh, there s lots of people that we don t want to interact with who are on twitter. you can block them. toure is not one of those. josh barro, thank you for keeping it tight and precise in honor of twitter. ari wasn t so capable of doing that. up next, the elephant in the room. time magazine s words, not ours. the cycle rolls on for thursday, november 7th. and after last night s cmas, i m feeling a little country. how about you? nope. i started part-time, now i m a manager.n. my employer matches my charitable giving. really. i get bonuses even working part-time. where i work, over 400 people are promoted every day. healthcare starting under $40 a month. i got education benefits. i work at walmart. i m a pharmacist. sales associate. i manage produce. i work in logistics. there s more to walmart than you think. vo: opportunity. that s the real walmart. was a truly amazing day.ey, without angie s list, i don t know if we could have found all the services we needed for our riley. from contractors and doctors to dog sitters and landscapers. you can find it all on angie s list. join today. at any minute. .you could be a victim of fraud. most people don t even know it. fraud could mean lower credit scores. .and higher interest rates when you apply for a credit card. it s a problem waiting to happen. check your credit score, check your credit report, at experian.com. america s number one provider of online credit reports and scores. don t take chances. go to experian.com.