Trump’s TMTG has huge hurdles to overcome

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TMTG or former President Trump’s Technology Media & Technology Group has released a 22-page presentation outlining what it will attempt to accomplish. He describes on slide 7 that he will tackle Twitter and Facebook first, as well as creating what looks like a subscription offer similar to Netflix.

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and Disney +. At the same time, he plans to take on CNN and iHeartMEDIA (the biggest owner of radio stations) and build a tech stack in the future that goes against Amazon.

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AWS, that of Google

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Cloud, that of Microsoft

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Azure and the Stripe payment processor. I guess if Trump throws enough corporate logos on a slide it will make what is an overpriced PSPC stock reasonable.

Huge commercial barrier

TMTG’s Truth, intended to take on Facebook and Twitter, available for pre-order on Apple’s

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App store and I guess they will be available on Google Play. He will need these platforms to reach a large audience.

On slide 8, TMTG presents a high-level timeline of US media from newspapers, radio, cable TV, and social media from the 1790s to 2021. As can be seen from the timeline, it includes when Speak, a conservative social media app, was removed from Apple and Google stores. Trump’s TMTG Truth could very well suffer the same demise if it ends up violating the platform’s terms of service.

Huge technological barrier

Building a large, scalable and reliable technology platform takes time, commitment, and hundreds of millions, if not billions of dollars. Large tech teams need to be hired and retained, along with a massive number of servers to store and distribute content. Typically, a start-up will rely on Amazon’s AWS or Microsoft’s Azure to provide this service in the short term and potentially longer term. However, just because the hardware part is outsourced does not mean that TMTG will not need a large and competent technological team.

What if these companies find that the content on the servers does not comply with their terms of use? It will be extremely difficult for TMTG to build an organization large enough in a short period of time to support its offerings and therefore the share price.

Huge barrier to content

On slide 20, TMTG + says it seeks to provide “news, big tent entertainment, exciting documentaries, sports programs and more.” The company seems to want to create a subscription model like Netflix and Disney + but with traditional cable network or TV offerings.

Netflix and Disney + have created huge libraries of content over several years, if not decades, and licensed them in the case of Netflix, which cost and continue to cost billions of dollars every year. If TMTG is to create this kind of content, it will either have to raise a lot more equity, or take on hundreds of millions or even billions of dollars in debt, like Netflix has done.

Cable and television networks are heavily staffed and engage in multi-billion dollar deals with sports leagues. He may be able to leverage like-minded partners, but besides studio leaders, having real content takes a lot of money.

Unknown ability to capture large number of users

The presentation points out that Trump had a total of 146.5 million followers, including 89 million on Twitter, 33 million on Facebook and 24.5 million on Instagram.

Statista estimates that Facebook controls the five biggest social networks; Facebook with over 2.8 billion users, You Tube, WhatsApp, Instagram with nearly 1.4 billion and Facebook Messenger. Twitter is coming in 16e place with around 397 million users.

Trump’s numbers were important, but they don’t take into account the number of people who felt “obligated” to follow him when he was president, of users who won’t bother to download and use his. application and how many were bots.

The presentation also indicates that just under a third of those surveyed by The Hill would use a Trump-backed social media platform (Slide 14). I suspect that when people should do something to join TMTG, the percentage ends up being lower.

The disclosures at the end are a little weird

The information on page 22, the last slide, includes statements about “the use of non-GAAP financial measures” and “employee disclosure”. What’s odd about this is that the presentation doesn’t include any financial or personal information. These may have been included in a more robust version, as one might think that financial estimates were generated and shared with a limited audience.


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