in which I realise Twitter can make money

(I was going to say something about "monetization" but that term is getting a bit old.  Can I make it through the entire post with out using it?  Let's see...)

Ok, social networks are hard places to make money.  Sure you know a lot about the users, but they're busy flirting with one another or posting pictures of their cats or digging up embarassing images of people passed out last night.  They're not searching for information, they're interacting with people.  Trying to wedge commerce into friendship, as Facebook is trying to do, trying to make money from social interactions - just doesn't work well.  Wrong mode.  See previous posting the difficulty of (making money from) Web 2.0 eyeballs.

So I thought Twitter was probably hopeless in terms of a business.
But then I realized that Twitter is also real-time search.
And search we do know how to make money on.  Boy howdy do we.  To the tune of billions of dollars.

So Twitter actually has it easy.

1. Do the usual adsense matching ads to keywords thing on search.twitter.com
2. When you can't parse the keywords well (as may be the case with hashtags, e.g. #lotf09), build a metadata directory to figure out what the hashtag maps to and then match the ads to that - in which case, ideas like tagalus are going to be worth lots of money - you heard it here first

So Twitter should be fine.  Should be big dollars fine, in fact, as real-time search grows in popularity.

This is also a very simple lesson to all you Twitter-wannabes out there (are you listening, Facebook and FriendFeed?) : you want to make money from the real-time web dynamic whatever - fine, just do it in a separate search interface, not in your main user interface.  When they're in separate search, you know they have intentionality.  Intentionality, you can make money from.  When people are expressing a desire, you can use ads to meet that desire.  That's like, probably the whole underlying concept of ads (yeah, I watch Mad Men).

Whereas ads while people are socially sharing links, pictures, and whatever, not so much intentional seeking, not so much any opportunity to make money.

UPDATE 2009-04-07: I should also mention a current approach that Twitter is experimenting with

3. Subject-specific portals

Since Twitter provides aggregated real-time conversations, you can try to find various ways to slice the conversations up by topic or other  attribute.  The two approaches I am aware of so far are:

* to slice by "authority" or identity - ExecTweets is a portal to "executive" Tweeters (which I think is a bit nonsense, in an age in which authority emanates from your ideas, not your position) - the portal is sponsored by Microsoft - there are other portals that slice out particular celebrity twits etc.

* to slice by content - MarchTweetness/TitleTweets is a portal around the US March Madness basketball thing, sponsored by AT&T - one can imagine a similar soccer-oriented site for the international audience

So one can imagine e.g. a site built around the launch of the SF series Caprica, that captures all the #caprica tweets and attempts to target people interested in science fiction, selling BSG merchandise etc.

I personally think this idea is pretty weak overall, because subject-specific portals generally fail.  Google beat Yahoo.  People jump from topic to topic as they explore the web, as the impulse strikes them.  No matter how much info your portal pulls in, there's always going to be some rival portal on the same topic that people want to check as well.  You cannot hold people on a specific website.  Also, unless you do this in an automated fashion for all topics (in which case it will look generic), it is a lot of work to do a custom siloed portal for each and every particular topic you want to make money from.

I can imagine though they will continue the TitleTweets trend of searching for the "big eyeball" sweet spots like the SuperBowl for custom Twitter portals.

Comments

[Mike Templeton]

I think you're on to something, though what you mentioned about placing search in its own interface is something Twitter seems to be doing the exact opposite of with their latest interface tests. Lately they've actually been working to build the search results into your main interface, thus keeping you in familiar territory.

Your mention about hashtag lookups is exactly why myself and the other guys at Microblink cooked up What the Hashtag?! as an encyclopedia for Twitter hashtags. We're still working out additional features and trying to build traction, but the basics are certainly in place.

I'd be surprised if Twitter didn't start scooping up some of these third-party developed services, tools and apps and rolling them under their own brand, as they did with Summize/Twitter Search. They stand to gain more from them monetarily if those tools reside in-house.