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Twitter’s all grown up

Steve Henn Apr 19, 2011
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Twitter’s all grown up

Steve Henn Apr 19, 2011
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Kai Ryssdal: Here’s the thing about technology companies. One day, they’re start-ups. The next day, they’re start-ups worth billions of dollars.

Just five years ago, Twitter was basically unknown. Now it’s almost too well-known — investors are clamoring for a slice of its still-private shares. That, in turn, is giving Twitter a very grown-up corporate problem: It needs to actually make some money.

Marketplace’s Steve Henn reports.


Steve Henn: Twitter started to get serious about bringing in revenue a year ago. It made its first foray into the world of advertising and began selling promoted tweets.

Debra Williamson: They are definitely seeing real revenue from advertising.

Debra Williamson is at eMarketer. She’s done what’s considered the most thorough analysis of Twitter’s revenue. Williamson says Twitter probably sold $45 million in ads last year. This year, she expects that number to triple.

But Andrew Lipsman at comScore says Twitter’s explosive growth may be history.

Andrew Lipsman: The audience is growing more steadily; it certainly is not accelerating as quickly as it did before.

One problem for Twitter is lots of folks access it through third-party apps — like TweetDeck, which brings together your tweets and Facebook messages all in one place. Apps like this stand between Twitter and some users. And Williamson says Twitter’s ads may not reach those people.

Williamson: And that’s a big problem. If a large group of your loyal dedicated users are using a platform where they don’t see your advertising. That’s a big opportunity for Twitter.

For months, Twitter’s been pushing to connect more directly with its entire audience. But some apps like TweetDeck are so popular, Twitter can’t simply push them aside. Instead, it may buy them. There are reports today Twitter could spend as much as $50 million on the TweetDeck app. Twitter’s execs declined to comment.

In Silicon Valley, I’m Steve Henn for Marketplace.

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