In a world where everything is being jammed into 140 characters or less, shorter is better. That goes double (or is it half?) for lengthy URLs. So-called URL shortening services are increasingly becoming indispensable to anyone who uses Twitter. It is the only practical way to share links on the service.
Today, one of these URL shortening services, bit.ly, raised $2 million, sparking the question: How much are these things actually worth? Nobody really knows.
But here is some fun math. Assuming bit.ly sold 20 percent of its shares to its new investors (the O’Reilly Alpha Tech Fund, Mitch Kapor, and Howard Lindzon), that would imply an $8 million pre-money valuation ($10 million post-money). Its market share of shortened links, as calculated by Tweetmeme, is only 13 percent. The biggest URL shortner out there is actually TinyURL, which commands a 75 percent share. So by that metric, if bit.ly is worth $8 million, TinyURL should be worth at least $46 million (8/13 X 75 = 46.15). Yes, I am making up these numbers, just like the investors do.
But wait. Bit.ly seems to be shooting up like a rocket, while TinyURL may have plateaued. Why is bit.ly growing so much faster? One big reason is because it creates even shorter URLs than TinyURL does by about five characters (http://bit.ly/ versus http://tinyurl.com/). Don’t laugh. Every character counts. Bit.ly also offers better analytics and tracking tools on the backend.
Don’t get too caught up in the site traffic growth figures either, though. Traffic to http://bit.ly/ and http://tinyurl.com/ cannot be trusted as reliable proxies for usage because heavy users don’t go to the corresponding websites. They use desktop clients or browser based tools instead which incorporate one service or the other. For instance, TweetDeck (a popular Twitter client) uses bit.ly as its default shortener. The bit.ly service itself is a spin-off from Betaworks, which is also an investor in Tweetdeck (and in Twitter). See how it works?
How any URL shortener is supposed to make money is still unclear. The links themselves act as pass-throughs to the original sites. TinyURL has slapped some Google ads on its site and bit.ly doesn’t even bother. The data each service is collecting might be valuable and could be packaged in various ways to brand marketers or other corporate buyers . . . perhaps. Or more likely, these things become features of other services.
Already Digg is working on its own URL-shortening toolbar wrapped into its service, and Stumbleupon is working on su.pr, which is even shorter than bit.ly!
Seriously, how short do you need them to be? It’s not like anyone actually types the URLs – or do they?
Twitter only grants you 140 characters per message. Because of this, the shorter your url links are the better. TinyUrl.com is simply way too many characters to be dedicating towards a url when you’re constrained to a small number of characters per message.
Exactly. Stay tuned for http://vad.is. It will revolutionize the scene.
Sad twitter cant give link field feature to updates. That would have made for great SEO compared to these tiny redirects.
@sad twit: IMO, Twitter concentrates on the platform – they have to reduce the network issues – but complaining isn’t the best idea given that most of the time Twitter is handling a load that a P3 with 500MHz and 512MB RAM would be just right, and in peak hours/events, it can shoot up to Dual Core scale loads.
I figure that “the cloud” specializes in scaling for just that reason – we’re going to see a lot more mobile computing in the future, with Twitter-like behavior – sporadic bursts of high netowrk activity – it is like having to handle getting dugg/slashdotted every other day, and you have no money to pay for that load for a year, and it wont happen that frequently either.
I meant they http links should have text [link], so that it is actually 4 letters lost out of 140. And this being direct link help seo as well as mouse hover visibility link target – only twitter can do it – and it saves time of creating tiny urls.
Does anyone think 140 characters will always be the limit?
If not, it would’nt be micro-blogging. I hope they stick with the 140 characters.
Brevity trumps verbosity!
Unless you have to name 258 dead jet passengers
Publish a legal disclaimer
Explain why you were an idiot in the last twitter
By there own snippets shall the great clueless masses proclaim their morose insulation from the requirements of knowledge
*See also OMG MY BFF JILL
But nowadays tinyurl is becoming old fashioned..
http://www.smartbloggerz.com
I built my own system a while back to use internally, it’s called buzvia.com and works really well with all the stats I need to manage my properties. I looked at tinyurl and it was good but can always be improved upon.
Jon
http://buzvia.com – Where’s Your Traffic Going?
While it may be useful for twitter, most other social sites are banning these services. I know for example http://www.anonboard.com bans them because they can be used to mask a malicious URL and trick users into clicking it.
agree.
I use a script to change short url as their real value cause i hate clicking on a link I dont know.
Welcome to the internet Jonny Tokyo
LOL@Foobar. Well said.
Jonny Tokyo is Google’s best friend
this is ridiculous are you serious .. if you have wordpress you can associate any address with the short version like techcrunch.com/?p=123 ….. I mean $8 millions for in house solution c’mon …. lool give me the money if you don’t know where to invest it….
*One* keystroke is the “gold standard”. There are many ways to get this done – keyboard shortcuts, client, server, agent, lots. bit.ly and tinyurl are agents, and their toolbars are clients, Twitter is a server.
Because a hidden compressed url is like a box of chocolates… you never know what you’re gonna get… I created a SAFE alternative called VisibleURL.com that I believe resolves the problem of an internet minefield.
Ummmm is this actually happening?
Who said the bubble was over? Psssh.
The champagne store said they’re out. Try soda.
That guy squatting single letter domain names is so ready to cash in.
If anyone wants to beat it by having an even shorter URL by two characters I could sell you u.bb domain name…
What the dickens does u.bb mean unless I AM a BB?
I’m not going to use a dot anything that suggests it leads to porn, spam or bot-ulism.
Mystery meat.
http://ow.ly also offers analytics and is one less character than bit.ly.
That’s adorable. ow.ly also goes perfectly with twitter. Thanks for the tip
I’m also surprised that http://tr.im wasn’t on the list. That’s been a favorite of mine for a while. They do nice stats too.
same here, i use trim very regularly
can we go one shorter? I have no idea and like the tr.im {seesmic_video:{”url_thumbnail”:{”value”:”http://t.seesmic.com/thumbnail/8oVxvWMI5H_th1.jpg”}”title”:{”value”:”can we go one shorter? I have no idea and like the tr.im ”}”videoUri”:{”value”:”http://www.seesmic.com/video/HRbzCidnFG”}}}
Ow.ly is complete shit. It opens the page up in an iFrame. The guys doing hootsuite are trying to cash in on the traffic by creating short urls that are extremely annoying.
We are using http://tweetube.com. Not that short but best analytics for everything.
8mln$? 46mln$? I guess you anticipated the news by 1 day, should be online tomorrow.
song.ly will be the ultimate smash-hit as soon as they start selling music
You’ve got to be shaving my face…
What the hell do these guys need investment dollars for?
I wouldn’t trust my hands to a straight razor even on my own face. Also does not much for me neither.
Do you really think traffic is the right metric for potential value creation here? TinyURL is just a dump passthrough, while bit.ly is creating analytics and APIs around their service, tracking clickthroughs, making it available, etc. That’s worth a lot more than just the eyeballs.
Charlie – I think you’ve hit it on the head. Bit.ly is really useful for tracking conversion rates and other analytics around links within tweets. Plus the real-time clickthrough tracking graphs are a blast to watch.
I love how, up to this point, everyone has made money except Twitter. I know bitly just raised some capital just as Twitter has done but 2 million? I think that’s insane. Isn’t this a recession?
Bit.ly certainly has a lot more features and a much more attractive website to boot. Although the name isn’t as memorable as TinyURL. Will be interesting to see how any money is made with these sites.
Very poor investment from betaworks. Dare I say the entire bitly site (including every feature it has – analytics, click tracking, etc..) could be coded in a scalable way in about a week or less.
As for the traffic, its easy to do that when a existing property is driving the traffic to it.
yeah, i noticed this. it might be more beneficial for large sites to pre-make their own shortened urls
with a smaller namespace, they’ll have accordingly shorter url’s. and if they use nonstandard characters like tinyarro.ws or some other sites whose characters i can’t decipher, they will collapse the market for sites like this.
It’s a big assumption that the investors only took 20%. It’s no longer 2004. But I guess you’re guaranteed the valuation is at least $2M which is pretty crazy anyway.
Why would you dump millions into a commodity service? URL shortening wasn’t even novel when there was only one player in the field.
No revenue + no barriers to entry = perfect investment opportunity!
this particular investment really makes me wonder what people are thinking.
You and me both! Perhaps their only exit strategy is to sell to Twitter?
I don’t know how you can monetize the service without killing the user experience.
Why would twitter by a redirect service? It could be coded in no time. All you need to do is spend a few grand on a short domain. Hell spend $20k and buy a real nice one.
And no way you are wondering Michael because, say, Om beat you to the story?
Om’s been kickin butt lately.
when michael say its a bad investment you know it is. how tough is it to build a short url service?
Not only do I not understand investing 2 million in a company with no plan for revenues, I don’t even understand what you’d spend it on.
I mean seriously, you have a sharded database with one table and a bunch of front-ends with some custom cache logic in them. But not even many of those, since every hit amounts to a single lookup. And not much bandwidth or storage either, since your replies are just redirects.
Even hiring a team of guys to do analytics on your log data shouldn’t cost 2 million.
I’m a little worried with the twitter rush that there’s going to be a overcrowding of companies providing “analytics” data to marketers. And too much supply = low prices.
Besides that, your risk that twitter introduces its own version and totally undercuts you is just too tremendous.
Mike, remember this date as you’ll have to learn that you were wrong back then on March 30, 2009.
Admittedly, you’re right in regard to most URL shortening services on the market today.
However: Note that things are not carved in stone. Note that things are usually more complex than they look like. Example? Just look at how simple Google’s home page is. I could clone “Google” in 5 minutes for 5 bucks. Not! The same goes for TechCrunch. It’s just a blog, after all. Not!
You’ll see.
This investment is a joke, but I found the meeting notes:
VC Partner 1 : How was Napa this weekend?
VC Partner 2: Oh it was great. Totally relaxing. Hey, should we make some investments today?
P1: Sure. How about this web-URL-thingy?
P2: How does it make money?
P1: Does it matter? We’re making 2% mgmt fees on that big-ass fund.
P2: Yeah, you’re right. Ok, sure, write them a check and cross your fingers!
P1: Cool!
http://tr.im is even shorter and has nice stats.
Glad to see that speculation is back. Long live web 1.0.
I nearly bought http://sl.im a while ago, but for $700 for a “premium” domain (per year; it wasn’t registered at that time, it’s just that the registrar is greedy) I decided it wasn’t worth it, especially given the unclear business model. Wish I had now!
(someone regged it a little while after I decided not to)
Honestly who cares? So it shortens a website it’s not that big a deal
Man, they’re going shorter and shorter… How would they monetize? I still see a big loophole on the security issues, like when people get redirected to other websites.
TechFilipino
How exactly do these services plan to return their investors money?? Office furniture and old computers…when they realise their is no way to monetize this service.
I wish I could write a website where each line of code was valued at around $200,000.
what if someone with an even shorter url come through?
URL shortening is a terrible idea promoted by weekend software architects who fail to understand the underlying security risks, as a response to a silly 140-character limit imposed by Twitter purely as a way to enforce a new style of communication. Twitter messages could easily be limited to 140 characters *plus* one URL of any length, thus maintaining one of the product’s essential design goals without compromising security.
Why URL shortening companies get that kind of valuation is beyond me.
You obviously don’t understand the nature of SMS. 140 characters plus one URL of any length simply doesn’t work. It’s in about 140 characters including URL (total SMS length is generally 160 at max).
There have been experts predicting a short life to SMS (heck, SMS wasn’t actually planned at all, but it’s an extremely successful by-product).
Now it turns out SMS has a longer life than many experts.
While the nature of SMS may limit us to text only up to ~140 chars, that kind of a useless point to make when you use to undermine the usage of the full links, how often do you sms the shortened URL?
My point is, twitter could easily do as Jean-Michel Decombe said and it would be no different for SMS users as they don’t text URL’s anyhow, no matter the length.
Also, I doubt there’s a phone out there made in the past 4 years or so that can not split your message into multiple messages, making the 140 character limit silly, again.
URL shortening services have been around and been used by millions of people LONG before Twitter was even here you douche.
Oh, yah, no kidding? And how does that make them a good idea securitywise, pray tell? I am sorry if you work for a URL shortening company and I offended you so much that you had to resort to juvenile name calling.
So aren’t these redirect url sites … a hackers dream? used to be the url was the only way you knew it was a fraudulent site… or am I missing something here?
Absolutely. Firefox has a URL expander extension though, but it’s no good if you use a twitter client.
I never used bit.ly until I began using tweetdeck. it offers a number of URL shorteners, but bit.ly is default because it comes first in the English Alphabet. With the growth of tweetdeck or other twitter clients, this seems like a plausible reason for the huge growth.
twitter has absolutely no reason to buy any of these services. they can just write their own.. or better yet, do absolutely nothing, there’s no reason to even create your own url shortening service – it ain’t cutting from your business, or giving you more revenue
tiny-fb.com, like all the above mentioned but makes it easier for a user to make a custom vanity URL for their facebook. long needed.
I personally use http://tr.im
I’m surprised that it wasn’t mentioned in any of the lists
Tr.im’s market share was outside the top 5 when I last looked at it, I don’t remember where exactly.
I’m always on the lookout for some new trim….
I use http://its.my . Its got some cute cartoons and other better names to choose from.
We established bee5.de in Germany. If we find an affiliate program for the link the user can even earn money.
I wonder what they’ll use the money for.
Makes me wonder why Twitter don’t simply rewrite the URLs themselves when the tweet is added, so you simply paste in a normal unshortened URL – and Twitter calls the anchor text “link” (or something) or even allow anchor text that the person writing the tweet could choose, (it’s nofollow so no big deal about people spamming). It could be written in 5 minutes and allows for more meaningful links since the tweeter(?) can describe the links in anchor text, and rolling over it will show you it’s actual location.
Evan Williams has said in recent interviews how the number of mobile users on Twitter is a minority and may be declining – most people access it through web or one of the clients. In that case, why don’t they just stop requiring the URL to be within the 140 character limit? It’s a little scary clicking on any twitter link at work because who knows what’s going to be on the other end.
Please don’t forget to attribute your images. Your pie chart and table are a direct screen-grab from the tweetmeme blog – http://blog.twe.../23/shorten-it/
8 million dollars for a URL and domain and a rented server.
We’ll never win the War On Drugs.
I’ve been in the process of collecting more data from users of http://urlb.at to display for users too.
urlb.at didn’t take long to write at all. I did it as a bit of fun a while ago.
at some stage I may whitelabel it, sell it or make it all open source.
with more acquisition they have “for free” it is absolutely what make the tiny make not just a tiny in there revenue and I wonder they keep use “adsense “as there main resources
http://siteanal....com/?metric=uv
Your going on Google trends, if you look at all the traffic estimators available you will get different results.
I hate bit.ly, it’s REALLY annoying to type, tinyurl flows smoothly and I can type it in about a second. bit.ly is good for Twitter I suppose.
I would put down money that TinyURL will still be the biggest in 2 years time.
Twitdom.com is working on its own Short URL service.
Pre-alpha version is up at http://linkpwr.com/
there is still a lot of room of development. the workflow integration into social bookmarking has not really even begun. autotagging, checking link integrity and redirecting to waybackmachine or ranking stats across various services, fingerprinting and creating hashmarks, like urlplay.org
short urls have not found their way into the google machine (maps for example) and if used for the deep web of rich media and torrents have the potential to enhance DNS and enable more semantic features(like backlinking).
remember: on the web, everything is a url.
Wow, must be nice having buckets of cash lying around!
RT
http://www.anonymity.us.tc
One thing to remember about BetaWorks and something I believe is a big factor in investors deciding to put money into them — BetaWorks sold off Summize, their TWitter Search Engine to Twitter and now has some equity in TWitter. So not only are the investors getting a piece of a growing company with some popular tools being used my many people (and more tools coming) – they are also getting a piece of a company that owns stock in Twitter itself. The investment itself goes beyond just a URL Shortetning service. Expect BetaWorks to come out with other tools and sites as well in the futute.
I like the Betaworks logo as it reminds me of the 12 Monkeys movie
You are one decision by Google to add short URLs to search content (web.blogs, videos) away from having these services all go away.
It would give Google even more analytics about web asset usage and information flow – they love shit like that!
Doesn’t anyone use http://qikr.com ?! I don’t even get the bit.ly thing.. what’s that short for? And let’s face it, tinyurl.com isn’t that short.
And people say there is a recession.
Is it really worth so much ?
People are out of their mind, if twitter makes minor change to embed a link, then why you would need shortening URLs….
People have lost their sense of differentiating real worth and fake worth…
It is not like there is real constraint for needing short urls.
distribution of short url services in twitter – http://twitpic.com/20xo4 -