by Search Copywriter
D. Warburton
D. Warburton
Twitter will end 2009 in profit, as the social networking startup reportedly generated around $25 million (£15.6 million) from its search deals with Google and Microsoft.Despite all parties previously being tight-lipped about figures, Business Week has revealed that the popular microblogging site generated $10 million (£6.2 million) from its deal with Microsoft to include tweets in Bing search results and a further $15 million (£9.4 million) from inclusion in Google's real-time search.
It was not disclosed whether these were one-off payments or the start of recurring revenue from the technology giants. Nevertheless, the report from Bloomberg Business Week explained that these search deals would "carry sufficient value to help Twitter achieve a small profit for 2009."
The notion that Twitter has thus far lacked a successful business model looks set to change, as the company has rolled out a number of business incentives in addition to its major search deals. Twitter has made further profit from regenerating deals with telecom companies such as O2 and Orange to reduce user costs, and has also unveiled plans to offer a premium service to businesses that are looking to market themselves and their products through the social networking site.
Conversely, Twitter is also continuing to invest in expanding its services, with the recent news that the company has acquired Mixer Labs to benefit from geo-location.
Although it may be ending the year on a high, the future of Twitter's bottom line may depend significantly on further investment. Guardian blogger Bobbie Johnson has analysed the company's expenditure, and predicts that wages for Twitter's 100 employees will probably come in around the $10 million mark, while the site's explosive growth also means it will be spending significant amounts on infrastructure. More major search deals may prove to be the only way for Twitter to stay afloat.
