Twitter Platform Business Model

After recent announcement of new Twitter API limits followed by news of Twitter seeking funding at $250m valuation, I think Twitter may be building a double-prong business model: one they are still trying to define and a platform business model that charges businesses for web services for near future and, later, hosted services (run sandboxed third-party code at Twitter for tighter.

Om Malik writes:

As a company, Twitter is still trying to come to grips with its identity — whether it wants to be a service, a platform, or both. If it is just a service, then a $250 million valuation might be too rich. On the other hand if it ends up becoming a platform that is supporting add-on services such as Twitpic Stocktwits, then it can be accorded a different valuation.

I don’t think Twitter has to, nor should, choose one or the other if it can go after both. Of course, that takes time and resources as well as creativity and control but I think $250m valuation will help.

Speaking for myself, I am fine with paying for Twitter’s consumer service as well as platform service as long as fees are reasonable and service is flexible and dependable.

To other Twitter developers and entrepreneurs, a word of advice: try working within what Twitter API is designed for instead of trying to force it to do what you want.

Cool or not and needed or not, not everything that can be built should be built.

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