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Twitter Going to Sell Data To Microsoft or Google ?


Micro-blogging site Twitter is reportedly in licensing talks with both Microsoft and Google.

image“Ever since Twitter launched, people have been wondering how the company plans to make money. One possibility was that it would launch its own search engine but going up against Google, Microsoft and Yahoo! isn’t something a lot of companies are eager to do. So what else can Twitter do to make money? Well, according to All Things Digital, Microsoft and Google are both speaking to Twitter regarding data-mining agreements and there are a several scenarios being discussed when it comes to compensating the site

 

AllThingsD’s Kara Swisher cites sources close to the situation who say the deal could involve a payment of several million dollars to Twitter or any one of a number of revenue-sharing proposals that would give Twitter a piece of the revenue made from search results. However the most important part of this news is that Kara’s sources say Twitter is keeping the deals non-exclusive, meaning Yahoo! (or anyone else with an interest in all that data of who’s linking to what) can get in on the action too.”

[via]

Is there gold in them thar tweets?

 Maybe so, because–according to sources familiar with the situation–Twitter is in advanced talks with Microsoft and Google separately about striking data-mining deals, in which the companies would license a full feed from the microblogging service that could then be integrated into the results of their competing search engines.

Sources said a number of scenarios are being discussed to compensate Twitter for its huge and potentially valuable trove of real-time and content-sharing information, generated from the data stream of billions of tweets from its 54 million monthly users.

These include a number of structures, including a payment of several million dollars to Twitter, along with various revenue-sharing proposals that would give Twitter a piece of the revenue made from search results.

The deals, stressed sources close to the situation, are nonexclusive, especially because Twitter’s management is keen to remain independent and also nonpartisan in the growing search battle between Google (GOOG) and Microsoft (MSFT).

This means Yahoo (YHOO)–which recently struck a search-technology and online-advertising partnership with Microsoft–could also license Twitter’s feed to make its search results even more robust, although Boomtown could not determine if the company is in talks with the San Francisco start-up.

Sources said it is also possible that no agreement would be reached with either company.

image And execs at Twitter, Microsoft and Google had no comment when asked about talks.

But doing these kinds of data deals with big search players does make a lot of sense, since it would be hard for Twitter to turbocharge its own search engine without running into the big cash-laden guns at both Google and Microsoft, which recently launched its new Bing search service.

Twitter is, instead, seeking to create a large open platform, which many could plug into, from search engines to marketers to publishers to developers.

Twitter has also been considering offering premium services to these groups and is contemplating some form of advertising offering.

But, most of all, Silicon Valley’s hot start-up is focusing now on spurring growth and engagement, along with fine-tuning its product offering.

Being deeply integrated into big search services would give Twitter a huge footprint.

Microsoft had already done a small experiment this past summer integrating Twitter data into search results, starting with tweets of bloggers like me.

How much indexing of its data Twitter will allow is unclear, but the company has certainly bought itself time to think carefully about all its options, given that it now has a lot of money in the bank.

Late last month, Twitter raised another $100 million in new funding, after already having raised $55 million.

This has given it a $1 billion valuation, despite negligible revenue.

The valuation also effectively stated that the innovative company was pretty much putting itself out of play to be acquired and is very interested in forging its own destiny.

Both Google and Microsoft execs have contemplated the idea of buying Twitter in the past, although no serious talks ever moved forward.

If they both strike data deals with Twitter, they will get the next best thing–an ability to offer all the information disseminated on Twitter in search results.”

[via].

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  1. October 23, 2009 at 12:46 pm

    Great post. I just read a blog that touched on this topic briefly and then returned here. I didn’t think Twitter had any advertising revenue on their site and wondered why. But with the talks between Microsoft and google and all of the cross connecting the biggest players on the web have been doing for the past year and a half I’d say a new age is ahead. And this will probably spawn new technology and a plethera of apps for mobiles. Great post! Dave

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