There have been a number of rumors lately that suggest Google might be interested in buying Twitter. While these were downplayed by both Twitter and sources at Google, there is obviously some truth to this. Twitter is becoming so popular that all major players in the industry are following them closely; they would be stupid not to. The real question is: what added value can Twitter bring for companies such as Google and Microsoft?
The ever-increasing user base alone is not going to be enough for these companies; there has to be an opportunity to actually profit from it to make a deal worthwile. If not, Twitter might become the next Skype; eBay bought it without having much of of a business plan, and hasn’t been able to think of one since.
So where are the opportunities for Twitter? Here are some of my thoughts:
- Paid accounts. It might sound like a no-go for most people, but there is money to be made. Flickr has been doing this for years, and LinkedIn has special business accounts as well. It’s not going to make Twitter billions of dollars though.
- They might start advertising on the main twitter.com page. Traffic to twitter.com is growing fast; here is a real-time graph comparing twitter, flickr and linkedin:
With the amount of pageviews currently being generated, there is definitely money to be made just by advertising alone.
- They might do extremely targeted advertising; if I tweet about what I’m going to have for supper, I wouldn’t mind getting a reply by @NYPizza of @KFC telling me all about their special offers. There are endless possibilities.
- Related to that is the value the company offers for search engines, marketing firms, trend watchers and any other business that needs real-time information about current trends. I think this is where the real money is; Twitter is a continuous source of information on popular URLs, subject and brands. They used to provide this information via the Firehose, but somebody finally figured out this has a real value.
Looking at the positions they currently have open, I guess Twitter’s board agrees with me on some of these points. The are looking for a Director of Strategic Partnerships and a Business Intelligence Software Engineer; that translates to “we have useful data, let’s sell it”. There are also three open positions related to search; my best guess is that they’ll be placing the search option more prominently on their homepage, and use the search results as a testing ground for placing ads.