The Twitter logo.
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JEREMY HOBSON: Twitter is on a buying and building binge. Yesterday, it bought an Internet advertising company called AdGrok. And, it launched what it's calling a "follow button" that lets you follow bloggers and websites without ever going to the Twitter site.

Marketplace's Steve Henn reports now on the big boom going on in the Twitterverse.

STEVE HENN: In the race to dominate social media, Twitter is running a distant second to the force that is Facebook.

DEBRA AHO WILLIAMSON: Twitter's really got to fire up its engines.

Debra Aho Williamson is an analyst at eMarketer. She says to catch Facebook, Twitter needs to build revenue and expand its audience. AdGrok should help Twitter automate its advertizing sales sales and the new follow button may attract new users.

WILLIAMSON: I expect other things coming down the pike.

Rumors are flying that Twitter's about to launch its own photo sharing app. Photos are a Facebook favorite. But if Twitter makes this move a dozen independent apps like Instagram, and Twitpics could be forced out of business.

Charlene Li, a founding partner at Altimeter Group.

CHARLENE LI: If you create something create something that is a runaway hit and begins getting traction and becomes mainstream, then it's very likely that Twitter will copy it.

Li says if it's not careful Twitter could end up scaring away developers and investors capable of creating its next generation of killer ideas.

In Silicon Valley I'm Steve Henn for Marketplace.