Striking the Right Balance at Twitter

The leadership at Twitter is making a major move by attempting to gain additional revenue at their website. The supreme challenge is to strike the right balance. Charging too much, charging too often, or charging too many different people can ruin this successful enterprise. Twitter's plan to charge companies that advertise at the site and leave everything else the same is the right balance. Twitter should freeze its policy once this change takes place, and not charge anyone else.

Promoted Tweets

Twitter announced it will introduce advertising by allowing companies to pay to have their messages listed first on searches on the website. The program will be called "Promoted Tweets." Twitter is considering the issue of how it can increase its revenue and remain successful at the same time.

The ads probably will not bring in much money during the experimental phase of the program. Virgin America is one on the organizations that Twitter invited to test the program. According to Porter Gale, the airline's vice president of operations, the company is not paying for its first installment of promotional messages. Mr. Gale expects the program to turn into a paid model for the future.

Twitter would not confirm or deny if the first group of users are paying for the service. Twitter claims that Starbucks Corporation, Sony Pictures and Best Buy Company are among the first companies to test the service.

The ads will be introduced slowly. Fewer than 10 percent of Twitter's users are likely to see the ads on the first day. After that the ads should appear on all relevant searches.

Twitter has been wildly successful since it started in 2006. Approximately 69 million people worldwide used the service in March 2010. The site has been slow in capitalizing on its success, although investors value the sit at approximately $1 billion.

Twitter has a history of making money by providing Google Incorporated and Microsoft Corporation access to messages that can be used by their search engines.. The amount of this income is unknown.

Source: Michael Liedtke, Twitter to have paid tweets show up in searches, The Citizens' Voice Newspaper, April 14, 2010.