July 12, 2007

How Does Twitter Make Money?

I got an email today from Twitter, a free online application that lets users answer one thing — "What are You Doing?". Here's an excerpt from that email: "Hello, Twitter-ers! We were just as excited about the arrival of the new Apple iPhone as every other geek on the planet. So much so in fact, that Twitter Inc promptly issued a shiny new iPhone to all employees. We love them!..." I don't know about you but I'd definitely like to be a Twitter employee right now. This makes one wonder, how in the world could a service that doesn't charge for sign-up and has over 100,000 loyal users make money? Is there a magical money tree that I don't know about? Probably, the people that run it built a huge sailing boat in the 60s, sold it in the 70s after they toured the world, saved the money in a bank, and now they live off the interest. Indeed, that does explain the iphone phenomenum...er, maybe not. I did some Googling but still, nobody knows how they really make money. NYTimes has an article about Twittering. And so does this guy and this other guy. Obviously, Obvious corp., the founding company of Twitter, run a blog,"Obviously", that I'll keep an eye on for clues about their little business ventures. I'll need you to keep an eye on Google while I do this, don't want them taking over the entire world again.


Beth said...

But the real million dollar question: How do you make money?

I have thought about that about other online services. Do they advertise? That would make money.

I hate twitter. I can't figure it out, despite the help that you and Leal gave me.

Rodrigo said...

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groovypucks said...

One thing I can think of right now is they are using search clouds and selling the information on the BUZZ or what people are talking about to marketing companies. Talk about a potential spyware web 2.0 app.

The other thing I can see is that they can potentially come up with a deal with carriers like sprint or Verizon. Twitter can offer specials on upgrading their TXT plans and Twit' can make a cut of the sale. Like a finders fee. It would make Twitter money while helping out the end user. There are tons of ways Twitter CAN make money. But I agree, how are they doing it now. Enough to make acquisitions and also buying all the employees brand new iPhones.