Where is Twitter’s $150 million revenue coming from?

Social micro blogging site Twitter is under five years old and yet is projecting that its ad revenue by the end of 2010 will be $150 million. It’s a bold forecast by a company that has only been in the public limelight for less than 18 months. Where is Twitter trying to make its money?

The website is currently the 11th most visited in the world and has nearly 200 million visitors every month.

Promoted Accounts

With the Twitter redesign came a more prominent suggestions feature designed to give people ideas of whom to follow. Promoted Accounts appear in this section in order to bring greater awareness of the brands account.

This is a relatively new feature that hasn’t yet been fully rolled out, mainly because a large percentage of Twitter users don’t have the new layout. So it’s yet to produce any large interest; but Twitter has removed a strong interest from many multinational brands for when it goes live.

Promoted Tweets

In April 2010 Twitter offered its first promoted tweets for companies. When purchased, the main keyword from the Tweet would appear below the Trendy Topics; and once clicked, the advertiser would be charged.

Major brands and companies have already experimented with this method with varying success rates; they include Sony Pictures, Red Bull, Best Buy and Starbucks.

Firehose

A lesser-known feature from Twitter was launched in March 2010. Most developers know Twitter has an API but it’s a bit limited, both by the number of requests and the number of queries you can make.

Firehose is a paid-for feature that most major search engines, including Google and Bing, have used to incorporate tweets in their results.

Firehose users have full access to all information on Twitter.

Interestingly Twitter doesn’t charge everyone for the privilege of Firehose. Start-up search engines have been granted free access to the service including Collecta, Scoopler and CrowdEye.

Mobile Deals

Twitter has been described as the “SMS for the internet” and thousands of people access it from their mobile phones daily. It makes sense for the platform to have mobile deals for adverts.

Currently Twitter has dozens of relationships with carriers but the financial details are being kept a closely guarded secret.

The company has hinted at text-based alerts and location-based adverts.

These features are in development – but many news sources have reported that Twitter is keen to have these live before the end of the year.

Twitter is taking advantage of its moment in the public eye. I don’t think this moment will be short lived, and clearly nor does Twitter. So it’s investing time, money and resources in long-term monetizing strategies.

Ultimately Twitter is a business that needs to make money to fund itself. But I’ll be watching with baited breath to see if it hits its ambitious targets.