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squirrelinthetree t1_jaby3yc wrote

I wonder what it tells us about a company when it spends more on marketing than on making the product itself.

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damnsignins t1_jabyoxp wrote

That's how media works. There's a video floating around of Matt Damon on Hot Ones explaining how movie profits work. They have to spend at least as much money on marketing as they do on production and distribution, so if a movie doesn't make roughly a 4x return on its cost, it's a financial flop. Since Twitch has to spend a lot on paying streamers, they're operating revenue is thinner than most.

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silentorange813 t1_jac5men wrote

It makes sense if the company believes that it already offers a competitive product. The product lineup is also not as diverse as other industries like food or automobiles.

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MrMitchWeaver t1_jac8fyt wrote

Zoom is also a very simple product with few moving parts. It makes more sense that way.

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vgsnv t1_jadwem3 wrote

I assure you there is nothing simple about the technical product that Zoom offers.

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MrMitchWeaver t1_jady7ws wrote

I mean it needs few things to keep it running: engineers and servers. Am I missing something else?

Innovations would be covered by the R&D sector which is a different expense line.

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