How will Twitter make money?

Micro-blogging service Twitter will celebrate its third birthday in March and may have a revenue model to support the company over the long-term. Last month Twitter CEO Evan Williams told Kevin Maney of the company will kick off new revenue streams by March 2009 to avoid raising another round of venture capital funding. Twitter’s deeply engaged community would love to see a sustainable business develop around the site, its services, and the community. In this post I will take a deeper look at Twitter and its revenue potential as publicly hinted by its founders.

What is Twitter?
Blog platform
Twitter is a hosted blogging platform that limits blog posts to 140 characters or less. Short Twitter messages were designed as an archived status message communicated to friends via instant message, text message, or even radio bursts. Twitter’s 140-character message fits within a SMS message’s 140 octets for UTF-8, a design contraint that has spurred new content creation with little effort.

Feed reader
Twitter builds feed reading directly into the blogging service. Members subscribe to other Twitter accounts (“follow” in the Twitter vernacular) to receive updates in a centralized timeline. Twitter members create new posts referencing other members and their posts or comment privately via direct message, creating a publishing system that feeds off each uniquely assembled list of content.

Search engine
Twitter also operates a near real-time search engine against its public content. The search engine receives direct updates from the Twitter blogging service over a streaming API interface nicknamed “the firehose.” Twitter currently allows trusted external partners to consume this full streaming update of its data. Other consuming clients are limited to a public timeline snapshot of 20 Twitter updates every 60 seconds.


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