With a bevy of strong growth stats at his back, Twitter CEO Dick Costolo is getting pretty ambitious about his company's increasingly prominent status not just as a tech start-up but as a new kind of media company. The Wall Street Journal reports on Costolo's remarks at the annual Web 2.0 summit in San Francisco:
Costolo opened the door to sharing revenue with Twitter users that post interesting content on Twitter, though he said Twitter wouldn't pay such "content producers" for each tweet they post. "Our thoughts are a little more nuanced," he said, adding that Twitter would have a "narrow set of publishers we would do that with." He didn't elaborate further.
The idea of paying people--pardon, content producers--to tweet isn't completely outrageous. Various Twitter-based startups have been doing this kind of thing for a while. The most prominent is Ad.ly, a Beverly Hills-based that offers brands the chance to pay for endorsements from celebrities with large followings on Twitter. They've cut deals with everyone from Paris Hilton to Snoop Dogg to Charlie Sheen. In fact, it was Ad.ly that talked Sheen into joining Twitter after he flew off the handle this past March, and when he did, he gained a record-breaking million followers in his first day. CNN Money reports, "When Sheen tweeted about how he was looking for "a #winning INTERN with #TigerBlood,' Ad.ly paid the actor 'four to six figures' for it" as part of a deal with Internships.com.
Endorsement tweets are problematic, however, for the same reason that product placements on TV are problematic. If Twitter allows too many influential users to sell their followers, it might be hard to tell what's a real tweet and what's an ad. In an attempt to solve the problem--and comply with Federal Trade Commission regulations--Twitter requires endorsements to be marked as such, for instance by appending #ad to the end of the tweet. Past failed Twitter advertising schemes, nevertheless, confirm that advertising in Twitter's stream is an especially touchy subject for users.
For now, the idea of Twitter itself paying influencers is pretty vague and seemingly risky. After all, it's coming from a company that's struggled to build a sustainable revenue model. But as Costolo was careful to explain before mentioning revenue sharing, Twitter's explosive growth hasn't slowed down. Costolo revealed that Twitter's new integration into Apple's iOS 5 has boosted new user sign-ups three-fold and said that the partnership "will be going to be even better than we thought it was." On top of that, the volume of tweets sent everyday has skyrocketed "from 90 million tweets per day in September of 2010 to 100 million at the beginning of this year to 1/4 billion tweets per day as of today, a 177% percent change," according to Alexia Tsosis at TechCrunch.
With so many new eyeballs reading tweets, Costolo has said he wants to be careful that experimental business models don't get in the way of a good user experience. As Google and Facebook have done before, Twitter believes that building out the service with the user in mind will eventually pay off with profitability. "We're growing the business in a way that makes us proud. We're growing in a way that's sustainable and scalable," explained Costolo at Web 2.0. He added that this year in world history has also proved Twitter to be a valuable tool for democracy, "We're the free speech wing of the free speech party," he said.
This article is from the archive of our partner The Wire.
We want to hear what you think about this article. Submit a letter to the editor or write to email@example.com.