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bringing in significant revenue but, potentially, toward helping show new legions of users the value of Twitter. Just what Twitter might devise as a business model, however, is impossible to tell, says Randy Komisar, a partner in the venture capital firm Kleiner Perkins Caufield and Byers (which has not invested in Twitter). Will it be keyword-based advertising, sale of market research data, placement of sponsored tweets, or something else? “The speculative game is pointless,” he says.

Bit.ly, the leading service for Web-address shortening, experienced nearly 1,000-fold growth last year. In December, people clicked open Bit.ly-shortened addresses nearly 2.3 billion times.

A Billion Twitterers?

Last July, a set of purloined documents laid bare Twitter’s agony over how to grow as a business. TechCrunch, a technology-­business blog edited by the Silicon Valley gadfly Michael Arrington, posted a remarkable trove of internal Twitter business documents, obtained by a hacker who used a stolen password to enter an employee’s Google Apps account. (The TechCrunch posting remains live today.) The documents included meeting notes that captured the angst Twitter felt even as the number of users was skyrocketing, early last year. There was fear that Facebook would coöpt the Twitter model and that Google would “kick our ass at finding the good tweet.” The brainstorming was endless: the management team floated ideas from giving away phones preloaded with Twitter to developing a “TV Twitter.” They fretted over how to keep employees happy. So much ground was covered that it wasn’t possible to discern any one strategy.

But if a single strategy did not surface, grand ambitions did. “What does a completely relevant product look like for a billion people?” one unsigned note wondered. Most striking, the pilfered files included projections that by the end of 2013, not only would Twitter have a billion users, but it would take in $1.5 billion in revenue and $1.1 billion in net earnings–and become “the pulse of the planet.” In our interview, Williams would not elaborate. “It’s clear there are a lot of ways to make money,” he told me. “We want to do it right. We want to do it in a sustainable and scalable way.”

Twitter is hardly alone among online social-networking sites in its struggle to find a viable business find a viable business model (see “Social Networking Is Not a Business,” July/August 2008). As Williams suggests, the path to technology commercialization is rarely an obvious one. It wasn’t Google’s search technology but its success in selling ads based on keywords that fueled the company’s growth. “We always think of these companies as taking a direct line from A to B to C,” Komisar says. “But if you look closer, what you see is how crooked the line is that they have to navigate.”

A growing number of tweets come from applications running on other websites. Relatively few are sent as text messages.

Before Twitter’s birth nearly four years ago, Williams’s big score was his creation of Blogger, a simple-to-use blog hosting service that Google bought in 2003. Blogger was not the original idea but, rather, a by-product of a complex project-management tool for the Web that Williams was trying to develop at a startup called Pyra Labs (see “What Is He Doing?” November/December 2007 and at technologyreview.com). Similarly, Twitter itself was born at Odeo, a Williams-founded startup that was trying to develop a way to distribute podcasts. There, an engineer named Jack Dorsey created a messaging tool–the genesis of Twitter–that he thought would be good for dispatching bike messengers or emergency services. After Apple crushed Odeo’s audio ambitions by offering comparable services on iTunes, Dorsey, Williams, and Stone bought the company and eventually spun out Dorsey’s tool as Twitter. (Dorsey is now Twitter’s chairman; Williams is CEO.)

And Twitter itself is evolving. Consider the original question a tweet was meant to answer: “What are you doing?” This early emphasis on the personal and the trivial changed as news started to break on Twitter–earning it intense interest from the mainstream media–and as people began using it to network with potential colleagues and keep abreast of the thinking and activities of politicians, stock traders, celebrities. Then users began to redistribute news from media organizations, and the news organizations themselves started to tweet: Twitter became a river of news. The evolution is bound to continue. “Twitter is a tool so basic that it doesn’t suggest how you should use it,” says Amy Bruckman, a computer scientist at Georgia Tech. “I guarantee that in a few years we will look back at how we

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Credits: Ben Baker/Redux, Tommy McCall
Video by David Talbot, edited by Brittany Sauser

Tagged: Business, Web, Twitter

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