Sunday, 20 March 2011

Cha-Ching...Twitter's looking to make money

Just when we thought we were heading into another tech bubble, some companies decide they want to think about revenue.

At least this is what I understood from Twitter's announcement about API's last week (click here for details).

With valuations for companies like Facebook, LinkedIn and Twitter on the rise, little has been known about their revenue models and looking at Twitter's tantrums of late, you can start to understand what all the fuss is about.  Twitter has grown wildly popular because of the fact they had a fairly open API model which resulted in lots of Apps being developed with Twitter connectivity.

In fact, it's been so open that some of the best Apps are in fact Twitter clients themselves like Tweetie (which was later acquired by Twitter and became Twitter for iPhone / Blackberry), UberTwitter (which is now called UberSocial), TweetDeck, EchoFon, Seesmic, etc.  
Image courtesy:
With Twitter now saying they don't want to see any more third party Twitter clients in existence in the long-term, they've essentially cut the playing field down to a size where they can start to dominate again.  How?  By making more people use their official Twitter clients.  

This then raised the question as to who they'd be targeting.  The average Joe is probably not the person they want (except for the advertising revenue they could get by him using their official client) but most likely they're after the corporate clients.  After hooking up businesses, large and small, Twitter has recognized that for most companies, there is more than one person who manages a corporate Twitter ID.  In such cases, third party clients like HootSuite or CoTweet have been used as you can track easily who's responded to what Tweet or who to assign a Tweet to.  Furthermore, the statistics that both can provide, helps any company on Twitter go someway towards justifying their investment in social media.

However, with HootSuite now charging companies that want to have multiple users on one Twitter account, it's left CoTweet to sweep whatever is left, or that is until Twitter cuts off their pipe.  I won't be surprised to see Twitter turnaround and launch "Twitter for Business" where they start to charge companies for doing a lot of what HootSuite and CoTweet do for them today. This would not only please investors who'd like to see big-name clients now using Twitter official Apps, it would also bring in a revenue-base that isn't solely dependent on advertising and which is by most means stable, monthly income.

Let's see how it goes but I'm guessing we're going to be seeing a lot more from Twitter and get ready to wake up one day to find your favourite Twitter client cut off from it's life support system by Dr. Twitter.