Twitter is one of the worlds largest, and fastest growing social media & micro-blogging services available today!  In the normal business world, a visible monetization structure is considered crucial in maintaining longevity as a profitable company. There has been various speculations and rumors as to the intended tactics in which Twitter will start to create a positive cash flow to help keep the company afloat.

Some say advertisements within the site, or between random tweets.  Maybe a subscription based offering where users pay a tiered fee structure for various levels of service and abilities.  The simple fact is, they MUST start turning a profit to stay in business!  Eventually venture capital funding will dry without some sort of income performance or proof of potential… right!?

In my opinion, the answer is “Yes, and No”.  I personally think Twitter, and their VC’s are simply waiting, allowing Twitter to grow quickly in numbers, advertisement and distraction free! It is then that the greed and competitive blinders of some large tech or media based company will begin to see the subscriber base become an undeniably powerful database of users that they should acquire before a competitor does. It is then, at the negotiation table that Twitter would have the ability to negotiate the magic number that would generate huge returns for their staff and VC investors.

I think Twitter staff realizes that many people would simply be very turned off by distracting advertisements or by converting Twitter into a subscription based service for the same service their users have previously been using for FREE. It would be the eventual death of Twitter! A buyout is the next logical answer to their plan!

As to the future of Twitter AFTER a buyout?… Meager at best! The company that would acquire Twitter would eventually see that Twitter must have some sort of revenue stream to stay profitable, which would result in the aforementioned tactics, slowly killing the Twitter we love!

To put this idea into perspective, consider Yahoo’s purchase of Flickr, or Google’s purchase of YouTube, Ebay’s purchase of Skype.  None of those services are presently profitable! They were all purchased because of their subscriber numbers and popularity! It all begins to make sense!

I’d love to hear your thoughts!  Do you think Twitter will start turning a profit?  How?

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