By year-end, Twitter plans to introduce new revenue-generating ad tools.
Christine Pepin
Media Coordinator
It’s becoming one of the most asked questions among marketers: How and when will Twitter develop a viable business model?
According to Twitter’s co-founder, Biz Stone, they are not considering introducing advertisements on their fast-growing micro-blogging site. For many start-ups, this model poses a way in which money can be made without having to tack on a fee to its users. It’s the trade-off us consumers of free online services have accepted. There are not many free portals left out there that are surviving without it, so we’ve come to expect that animated ad at the corner of our screens.
Twitter, however, hopes to become different.
Stone and his fellow founders are dismissing the ad-model for a variety of reasons. For one, “it’s just not quite as interesting to us,” he tells the Reuters Global Technology Summit in New York. He furthers his reasoning that ads may become terribly annoying for the user. A big limitation that they note is the lack of knowledgeable staff members to help develop an advertising-sustained business. Another easy problem to fix, yet they have no desire to seek these individuals. Then ironically, the 40 employee San Francisco based company plans to double in size by the end of 2009. What kind of talent are they pursuing?
In lieu of ads, Twitter plans to generate revenue by way of ad-on tools for businesses and professional users. The company will still be assuring a free service but prepares to roll out additional features for commercial use, including “lightweight analytics” and a directory of commercial accounts to verify a business’ legitimacy. Twitter is also in talks for a partner agreement with cell carriers so that the service can be available through a subscriber’s text messaging network. With no pressures from investors to return profits and their recent $35 million round of financing, delivering a public offering is certainly not on Twitter’s radar.
Again, we stay tuned as the company continues to figure out how it could be possible in the future as its popularity compounds rapidly. Listen here as Biz Stone discusses the company’s direction.
Tags: Biz Stone, micro-blogging, revenue generating model, Twitter
