Cramer: Twitter's Hot 'Cause We Goof Off

 | Nov 06, 2013 | 7:45 AM EST
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Are we doing anything in America? Are we doing anything except watching devices?

I keep thinking back to the engagement studies that Sheryl Sandberg talked about at the opening of her remarks on the Facebook (FB) call, when she said that in 2013, for the first time, people will spend more time with digital media than watch TV, specifically 5.25 hours a day on digital services vs. 4.5 hours on television. One in eight of those minutes on a desktop is on Facebook and one in five of those minutes is on mobile.

Now, wait a second. What else is there time for? The average person sleeps eight hours. That's a third of the day. Then there's another third that is supposed to be work and then another third that is meant to be play. Do you mean to tell me that we are on Facebook and the like for more than half of that leisure time and television for the rest? 

I think what's happened, the secret of the success of Facebook as well as Twitter and even Yahoo! (YHOO) and AOL (AOL), as we heard from yesterday's successful conference call for that no-longer-a-relic company, is that people are doing far less work at work and fooling around with the Internet far more.

The Internet turned out to be the ultimate in Trojan Horses. Unlike television --  other than the CEOs who are allowed to watch CNBC all day and seem to do so -- the Internet is something that people accept and even expect employees, associates, partners, whatever the bosses are calling labor these days, to be watching. The insidious nature of this is that probably a huge percentage of Internet watching is totally prurient and self-serving, or even more accurately, fun and definitely takes away from what you are supposed to be doing. That's the dirty little secret of this amazing medium.

How did it happen so fast? And how do we know that it isn't all hype? Interestingly enough, you are gleaning a ton of information about how this happened on these conference calls. First, because people have so many devices there is a tremendous overlap of watching. The Facebook people may want to claim those 5.25 hours of watching for Internet, but I think given the plethora of screens out there it's become a two-screen watching era. That's how the networks AND the cable companies can continue to show incredible growth. The ad rates we have seen for non-Internet media have been stellar this quarter and those companies are throwing off a huge amount of cash.

Second, as we know from robust signups of T-Mobile and Verizon (VZ), only some of which might be migration from the growth at AT&T (T) or the switching from Sprint (S) because of the changeover of systems, there is a big boost of people watching programming on smartphones and on tablets. Some of that might be double-counted television, but most of it is programming coming from YouTube or from Facebook, Twitter or AOL's Huffington Post or a host of messaging, texting and e-mail applications.

Finally, we know from the escalating usage of (AMZN) or sites like Zillow (Z), which we learned last night, people are simply shopping all of the time when they should be working.

The only real loser for time has been print, which, from these usage data, has simply fallen off the face of the earth. It is the real casualty of the numbers, other than, say, work.

All of this cuts to a simple fact. The reason why social, mobile and cloud work so well, the reason why we are willing to seemingly pay anything for Twitter, and have been paying huge multiples on earnings for Facebook, is that these functions are always on and, because they are not static, always being checked. They are operative from the moment you wake up until the moment you go to sleep.

In fact, I will go a step further. Until the Internet is blocked at work for anything other than what you are being paid for doing, the usage will only higher. Which is why, in the end, the Twitter deal will be a success and investors will like the growth path as more and more people around the globe spend their time on smartphones checking the Web, looking at Yelp (YELP) for meals, going to Amazon to buy things and certainly checking anything sports on line. If only one-seventh of the people in the world have smartphones and that number is going to probably double within the next few years, and the 5.25 hours of the Internet expands to at least eight hours of when you are at leisure and at work, then you can see why people really want the stock of Twitter.

We're doing less work, we are fooling around more with the Web and it's accruing to just a few companies. And when each goes public we will clamor for them until something better to watch comes over our mental transoms. It's not just here to stay, it's here to grow, and grow at a pace faster than any pastime in history.



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