As far as I can tell, there is no clear revenue model with the service as of yet, but apparently it’s in development. They’re not making a dime yet, but I’m sure their rev model will involve advertising. Theres no way subscribers would pay for the service, not the critical mass anyway.
It’s ironic however that there are a ton of users already advertising their products and content through tweets all day… It’s possible that the folks at Twitter have been watching how the users are interfacing with the system, to decide how to best monetize all that traffic. It’s an insane amount of traffic, and at present it seems that’s all they have. It’s enough traffic however to get Google’s attention. Theres a rumor released this week that they’ve offered Twitter $250 Million for their platform (read the techcrunch article here).
As I was researching their revenue model, I found an interesting article discussing this issue. Silicon Alley recently completed a contest titled “Create a Twitter Revenue Model” to help generate ideas for the service. It’s a cool idea, I’m sure there were some intersting submissions.
There are already a ton of people jumping on the bandwagon, building services and tools around the platform. Last week I attended a local entrepreneur “Barn Raising” in Utah called Launchup. One startup presented their idea called TweetBooty, multiple online twitter accounts, which you can follow, that publish coupons from local businesses. I was having a hard time seeing the value of building an online coupon distribution system on the coattails of Twitter, but they even had VC money behind them…very surprising. They plan to make 5 cents per published ad. That’s alot of nickels boys and girls… With advertising appearing to be ultimately controlled by Twitter, I wonder how that will factor into their business model.
If I were Twitter, I’d take the $250,000,000 and run. They’ve done all the work to create the market for the platform, get people behind it. It’s time to let the folks at Google work their advertising magic and get out of dodge.
