Twitter's Business Model

Way back on November 7, I speculated on how Twitter could be monetized:

[H]ow is Twitter going to make money? Contrast the current Twitter with the current traffic.com. When I receive a text message from traffic.com, the first few characters of the message contain an advertisement, which is then followed by the information I requested. (Similarly, phone calls to traffic.com include audio advertisements.)...

But what about Twitter? Obviously you can't include an advertisement on every tweet, but is there another solution that would allow Twitter to make money while not alienating its audience? The best possibility that I can think of so far is for Twitter to send one advertisement for every 100 tweets that you send, and to target that advertisement based upon the text in those 100 tweets.

Well, some alternative ideas for monetizing Twitter have floated around over the last few days.

Dave Winer:

Here's what you do if you're Twitter.

Distribution.

How much you want to bet that Twitteriffic reaches a very small number of Twitter users.

Twitter, of course, reaches every Twitter user.

So what could be easier than to offer to sell everyone a client that makes Twitter work a lot better?

And of course Twitter would be entitled to some of that money.

Winer floated another possibility:

But what if [a cell phone company] did a deal with Twitter, or even bought Twitter? Then you'd be paying a monthly service fee to use Twitter, and might have chosen TMobile or Sprint over Verizon or AT&T because they have Twitter and the other guys have Microsoft's ripoff of Twitter. Or Google's.

Stowe Boyd linked to Jason Calacanis' ideas, one of which is very similar to my own. The guy is obviously intelligent.

Imagine if every 10th, 20th, or 100th tweet was an advertisement. Would that be so horrible? No, not at all. "your free Twitter account is brought to you by Apple's iPhone" would be perfectly acceptable to users and advertisers on the web. These ads will get solid click through if targeted well.

Here's Calacanis' third idea:

I would estimate 1-5% of Twitter users would pay for a professional version that had 99.9999% up time, as well as special features like file storage for MP3 files, photos and videos (i.e. like Pownce's pro account).

And I shouldn't ignore Stowe Boyd's idea:

[I]f third parties wanted to build other apps that use a twitter-esque social stream, they might make an agreement to reuse the twitter pathway. I have argued that common components of this type is the next step toward open standards in the social web....As long as I could push stuff through the pipe, I would be willing to pay a per message bulk deal.

[mrontemp business] | [mrontemp politics] | [mrontemp technology] | [mrontemp del.icio.us tags]

Sphere: Related Content