Twitter has often been ridiculed due to the apparent lack of a business plan. In fact Twitter’s possible business model has been a topic of hot debate. Over the past year, it almost looked as if pundits were obsessed with figuring out/speculating how Twitter will ever manage to make money. Now BusinessWeek is reporting that, Twitter might have finally reached profitability.
We had earlier reported that, Twitter has inked content sharing deals with both Microsoft and Google. While these deals will undoubtedly bolster the concerned search engine’s real-time capabilities, they have also succeeded in pushing Twiter into the black. Twitter is believed to have received $15 million from Google and $10 million from Microsoft. As a direct consequence of these multi-year agreements, Twitter will be able to make a small profit in 2009.
The other important contributor has been a reduction in the bills paid to telecommunication companies. Twitter’s growing clout has allowed them to renegotiate many of the deals at more favorable terms. In fact, this has resulted in Telecommunication bills being replaced by employee expenses as the single biggest source of expenditure. Maintaining profitability in the future will depend on Twitter’s ability to explore new revenue sources and keeping the number of employees in check.