The great speculative sport that has attended Twitter’s quest for a business model has taken a new turn, with an unconfirmed report that the white-hot microblogging service is in talks with tech heavyweights Microsoft and Google to broker separate data-mining agreements.
The idea is essentially a search tie-up. Under the proposed deals, Twitter would license the contents of its tweets to one or both of the firms to inform their search results, the blog AllThingsD reported, citing “sources familiar with the situation.”
If true, the deals would find an alternative revenue source for Twitter from what analysts and the company itself have been projecting.
Twitter has held out the possibility of putting ads on its site, while talking more loudly about selling some form of premium service to enterprise customers.
In a sense, the notion of harvesting tweets — Web users’ most immediate expressions of interest or opinion — to give a more real-time flavor to search-engine results seems very much in step with the times. After all, recent months have seen social networking giant Facebook ape several features of Twitter, such as the more prominent placement of instant status updates, and Google CEO Eric Schmidt extol the virtues of the real-time Web.
For Microsoft (NASDAQ: MSFT) and Google (NASDAQ: GOOG), Twitter’s massive clearinghouse of consumer data could be a valuable asset in their duel over search.
That market, of course, is dominated by Google, though Microsoft has been far from shy about its intentions to compete in the space, evidenced most recently by the search deal it struck with Yahoo (NASDAQ: YHOO).
The discussions with Twitter would reportedly entail provisions to funnel a revenue stream to the still-unprofitable startup from the search results served up based on the indexing of users’ tweets.
The deals were described as tentative and nonexclusive.
The companies declined to comment for this report.
Last month, Twitter secured a new round of funding that valued the company at $1 billion.