You saw this coming: Revised Twitter terms of service enables ads

A typical publishing business requires a business model before it can establish the type of service that can generate an audience. By anyone's standards, Twitter has never been a typical publisher. Venture capitalist Jason Calcanis -- who offered to pay a quarter million dollars for prominent placement on Twitter -- has been on record throughout last year and up until last May as saying a real online business must first build an "audience of scale" -- something on the order of 10 million unique users -- before it can actually start building a business model for monetizing the strength of that audience.

Well, Twitter is probably there now, but the first signs of what kind of monetization we're likely to see for it appears to be more categorical than architectural. As its first true sign to the world that it's "going that way," the publisher unveiled its new Terms of Service late this week, with a new and vague paragraph asserting its rights to place ads somewhere within the service, at some time.

"The Services may include advertisements, which may be targeted to the Content or information on the Services, queries made through the Services, or other information," reads the revised Terms. "The types and extent of advertising by Twitter on the Services are subject to change. In consideration for Twitter granting you access to and use of the Services, you agree that Twitter and its third party providers and partners may place such advertising on the Services or in connection with the display of Content or information from the Services whether submitted by you or others."

Use of Twitter remains free for everyday users, and is likely to stay that way. While analysts were openly speculating earlier this year about the possibility that Twitter could launch some kind of "premium" service -- perhaps longer tweets, perhaps including more business-oriented networking services on the order of LinkedIn -- the company did make a deal in March with Federated Media to let that publisher produce aggregate feeds for subscribers, for a service called ExecTweets. While some said founder Biz Stone essentially let Federated run away with a good idea, it's possible that he may actually be onto something, the latest clue being today's revised Terms.

Perhaps Twitter doesn't need to originate its own business model; it doesn't need to originate the good ideas. Others like Federated and Calcanis will happily do that job on Twitter's behalf, and maybe pay for the honor of doing so.

Last May, at Reuters' Global Technology Summit, Stone gave the audience two reason why he had decided at the time not to pursue advertising: "One is it's just not quite as interesting to us. There are no people at Twitter who know anything about advertising or work in advertising. So we don't have anyone there to make or take those calls."

But in retrospect, one realizes that Stone never explicitly said Twitter services won't include advertising -- just that Stone's team wouldn't be the one to make that happen. As he blogged last May, "Facilitating connections between businesses and individuals in meaningful and relevant ways is compelling. We're going to leave the door open for exploration in this area."

Stone repeated that metaphor in a blog post this morning, which may be an indicator of two things: one, that Twitter hasn't come up with any ideas on that front for itself, and still doesn't plan to; two, that no one else has either.

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