A Blog by Jonathan Low

 

Apr 6, 2011

How, Exactly, Does Twitter Make Money?

The secret sauce is revealed by Austin Carr in Fast Company. Hint; think data and hungry investors:

"Last week, Biz Stone appeared on the Howard Stern Show, where the satellite-radio host grilled the Twitter cofounder on virtually every aspect of the social network. One of the funnier parts of the interview came when Stern asked Stone about how much money he's made from Twitter, to which Stone replied that he makes a perfectly good salary, has a mortgage, and leases a Mini.

"So the only money that you've made is from your salary?" Stern asked, barely containing his surprise. "How does [Twitter] translate into you becoming [a] super wealthy guy?"

That question is certainly on the mind of Biz, and every other cofounder and investor of Twitter, especially Jack Dorsey, who recently came back on board as executive chairman. But today, we finally got a few more glimpses into how Twitter might plan to monetize.

According to reports, Twitter is trying to monetize the endless amount of data forever tweeting from around the globe. The network just opened up a new portal that will enable advertisers and brands to have access to its fire hose, and allowing them to see extensive data and analytics behind every tweet. Twitter reportedly will charge just 30 cents to get 10,000 filtered searches per hour.

But that's not all. Today it also surfaced that Twitter plans to offer companies Facebook-style brand pages. Before, there was limited opportunity for brands to advertise on Twitter. But according to one report, these "branded pages, through which advertisers could deliver tailored messages, are under consideration, along with other plans to increase the long-term revenue potential of the social network, according to sources familiar with the subject...the pages would work in a similar way to Facebook Pages, providing brands with their own space to deliver content and encourage Twitter users to follow them."

These plans, coupled with the company's Promoted Tweets and Trends, could help toward increasing Twitter's revenues, which have been pegged anywhere from $45 million to $150 million. Perhaps then Biz will be able to upgrade his Mini

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