Twitter’s price for Tweets: $25 million

December 21, 2009

The last time the world had a look at Twitter’s financial books, the company was targeting a meager $400,000 in revenue for the third quarter of 2009 and $4 million in the fourth quarter.

But that information was based on documents stolen from Twitter by a hacker and republished by the blog TechCrunch.

And it was before Twitter, the popular microblogging service that allows users to broadcast short, 140-character text messages across the Internet, had inked monumental deals with search giants Google and Microsoft.

TwitterBirdThe companies have kept mum about the financial terms of the deals, which will allow Tweets to appear in Google and Microsoft’s search results. But people familiar with the situation have told Reuters that money did change hands as a result of the deals and the blog AllThingsDigital previously reported that the search deals could be worth several million dollars apiece.

It turns out the search deals were worth $25 million, according to a report in Business Week on Monday. Google coughed up $15 million and Microsoft paid $10 million, the report said, citing two anonymous sources.

The deals will allow Twitter to finish 2009 as a profitable company, and comes amid ongoing efforts at the company to cut costs.

Twitter declined to comment on financial terms of the deals.

That’s an important validation for Twitter, which recently raised $100 million in financing at a $1 billion valuation, but whose money-making potential has until now been a purely hypothetical exercise.

The search deals provide a nice financial foundation for the company. The question now is whether will Twitter be  solely dependent on Google and Microsoft for its livelihood, or if the company can develop its own revenue-generating businesses, such as advertising and premium services, to provide a new source of growth.

3 comments

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I have a strong doubt of these social websites.
Many people are almost engaged with either in twitter or in face book,social websites.
I too have more urge to type 140 words in twitter by number of times.I liked it.I got many good friends from all walks of life.I am not a business minded person, so, i have not derived much benefits from these social websites.
Happy to say that,my comments on many lively subjects,words and phrases are with their minds.
Due to more coverages,more usages by government,private,small business promoters,prospectus of new upcoming singers and all added to twitter to get more revenue, more profits of this period and likely to generate more revenue and continuous profits on its own set up,applications and by its own marketing skills,and by new mechanism.
Good brief about twitter from media file.
Happy days ahead for Reuters reporters and to these well known social websites.

Posted by mdspatsy | Report as abusive

I have already written my views on this subject.
To added that, Twitter website is much popular and fast growing social website.
Usage,advertisement, small business promotional tactics by its members, and more publicity about twitter advantages from print media has also made twitter price for tweets 25 million.
Its revenue goes up day by day.
Other well known social websites will catch its speed with some modern marketing and by modern applications skills for retaining and consolidating their social networks.

Posted by mdspatsy | Report as abusive

For those who have any doubts about Twitter’s strength as a communication medium, search on Google for ‘Long John Twitter’. It’s a book about Twitter and will give you an idea of how effective Twitter can be in business, in politics and in social causes.

Twitter is going to grow and the deal with Google gives Google Power users access to real time data that Twitter provides. It’s a win-win scenario for Google users, Google and Twitter. Yahoo better pony up some money too if it wants a piece of real time search.

Posted by Interloper | Report as abusive

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