Is Apple Looking to Bite into Twitter?By Kathleen A. Martin | Posted 2009-05-05 Email Print
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The so-called Twittersphere is buzzing with speculation in the wake of rumors that Apple is interested in acquiring the popular microblogging and social networking service.
Apple may be interested in acquiring Twitter, the wildly popularly and equally unprofitable microblogging social networking site.
The "Twittersphere" erupted with speculation the morning of May 5 after Apple Insider reported rumors of the potential acquisition. Neither Twitter nor Apple responded to requests for comment.
What would Apple gain from acquiring Twitter? A social network of 40 million members and growing. Apple surprised many industry observers in 2000 when it bought the fledgling iTunes music service, only to integrate it with the iPod and create the most popular online music retail business. If Apple is interested in Twitter, there could be grander plans behind the scenes.
Despite its popularity, Twitter is burning through cash. Twitter has been operating on venture capital funding since its launch in 2006. While it continues to add users, it hasn't implemented revenue-generating products.
"Twitter has many appealing opportunities for generating revenue, but we are holding off on implementation for now because we don't want to distract ourselves from the more important work at hand, which is to create a compelling service and great user experience for millions of people around the world. While our business model is in a research phase, we spend more money than we make," the company has stated in published blogs.
Twitter users buzzed about the potential Apple acquisition, speculating that such a deal would lead to a fee-based structure for the microblogging service. Many IT vendors, analysts and solution providers use Twitter as a means of communicating with their customers and collaborating on technological opportunities. A fee-based system, some say, would squelch the collaborative benefits of Twitter in the technology community.
Twitter reportedly turned down a roughly $250 million acquisition bid by Facebook. Google has reportedly expressed an interest in Twitter, as well, presumably to counterbalance Microsoft's significant financial interest in Facebook.