How does Twitter make money?

+1 vote
asked Apr 22, 2011 by Feras (5,481 points)
***How does Twitter make money?***

Twitter has no ads on their sites so how do they make money to run the site. I have also heard that they have to pay mobile phone companies to send people updates by text. What kind of business model are Twitter trying to use?

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2 Answers

+4 votes
answered Apr 22, 2011 by catchatyou (97,380 points)
Actually, Twitter does have "ads."  Occasionally, you will see a promoted tweet, promoted trend, or promoted account.  Twitter doesn't make nearly as much money as Facebook, but I think that it is a fantastic service with a great UI.<br /><br />Twitter even has a page dedicated to people who want to advertise:
commented Jul 9, 2011 by Feras (5,481 points)
Is that actually enough money to run such a big site? I would expect they need more then that.
commented Jul 10, 2011 by catchatyou (97,380 points)
You might be surprised how much money they can make from it.  People are also more likely to click on an add that doesn't look like an add, so it's advertising done better.
0 votes
answered Jul 9, 2011 by zerocool898 (306 points)
Twitter has finally launched its revenue generating model and businesses can leverage the power granted by this microblogging site to promote their products through advertising on Twitter. Here are two primary ways in which Twitter is currently generating revenue.

Twitter Feeds on Google, Yahoo & Bing
One of the first revenue generating opportunities for Twitter was created through deals with Google, Yahoo and Bing, who bought the rights to display live Twitter feeds in their web search results. Twitter earned millions of dollars in revenue by selling the rights to publish live tweets on any trending topic. It's a win-win deal, as it brings more users to Twitter and provides search engine users with live data.

In addition to advertising, Twitter gets millions of dollars from Google and Microsoft Corp. to show tweets to users of their search engines. Twitter does not disclose its financial information, but those distribution deals, worth about $25 million, were enough to make it profitable in 2009.

Promoted Tweets, Promoted Trends & Promoted Accounts
The major revenue generating model for Twitter now is its 'Promoted Tweets' advertising model. Advertisers pay for promoting Tweets related to their product. Any search query related to the advertiser's product will be listed at the top of the search results. Also the name of the company promoting the Tweet is displayed below it.

Then there is the related concept of 'Promoted Trends', where the advertiser's product related trends are prominently featured on the website. Twitter has also created 'Promoted Accounts' for advertisers, which will be shown in the 'Suggestions for you' section, presented for Twitter users to follow. This advertising model is expected to increase Twitter's revenues to up to $125 million in 2011. Companies like Coca Cola, Disney and Starbucks have already made deals with Twitter for promoting their products.
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