Is Twitter’s Data a Goldmine?

The blogosphere was abuzz yesterday when it was disclosedt that Twitter is having discussions with Google and Microsoft about giving them access to the firehose of data generated by Twitter users, including links.

There were enthusiastic discussions about whether these potential deals would finally mean Twitter would be able to create a viable business model given Google and Microsoft may be willing to pay millions of dollars for access to the data. My first thought was that Google pays Firefox millions of dollars in referral fees to drive traffic so striking a data deal with Twitter could see the same kind of financial return.

While a deal with Google and/or Microsoft is definitely interesting, a far more intriguing story comes from Silicon Valley Insider, which reports that Twitter is already selling its “firehose” of data, typically between $1,500 to $3,000 a month.

If you think about all the companies that have been created within the Twitter ecosystem that have Twitter data at the heart of what they do, selling data – even to small customers – could be a good source of revenue. It’s a volume business but Twitter controls the keys to the kingdom so it could also be lucrative.

Maybe selling data is Twitter’s financial salvation – much like Google stumbled upon the idea of AdSense while it was searching for a way to make money. (Truth be told, Google borrowed the concept from Overture).

In the past, I’ve suggested Twitter should/could charge high-volume users of its API – a concept that always generated healthy pushback. Data, however, could be a more appealing and palatable option.