That was fast
Jinfo Blog

21st December 2009

By Nancy Davis Kho

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Was it really only eight months ago that I was reporting from the SIIA Brown Bag on 'Why Twitter Matters'? http://www.vivavip.com/go/e19043 Back in April, executives in the industry and VIP readers were starting to see Twitter for the strategic communications channel it can be, but heads were still being scratched - how does this microblogging service make money? Well, as reported today by Bloomberg BusinessWeek's Spencer Ante, Twitter is poised to end 2009 in the black after signing multi-year deals with Google (GOOG) and Microsoft's Bing (MSFTO to make its content searchable - http://digbig.com/5bawaq. Privately held Twitter does not release its financials to the public, and neither MSFT or GOOG would comment on the matter. Ante quotes 'two people familiar with the company's finances' who estimated that the GOOG deal was worth $15 million, the MSFT deal $10 million for the privilege of searching Tweets and posting them in search results. Add the new top line good fortune the fact that Twitter, which used to pay a lot of money to telecoms companies to distribute billions of Tweets as text messages over wireless networks, now has the bargaining power to demand better terms, and Twitter is ending 2009 on a rosy note. (Those cheaper rates may finally win over the under-25 crowd, who - among other things they disliked about Twitter http://digbig.com/5bawar - hated using up their text messaging allotment on Tweets.) Suddenly the three-year old company's strategy of focusing on increasing the number of members (to 58 million, according to recent reports) and building strategic partnerships over chasing more obvious revenue opportunities is making sense. With the rich content set of millions of Tweets from around the world, on a platform increasingly used for serious B2B and B2C communication, Twitter is the place where MSFT and GOOG need to be if they are to maintain their own relevance.

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