So Uno sent me a link to a Techcrunch interview with Twitter cofounder Evan Williams .

It covered their recent acquisition of Summize Twitter search, (which now redirects to search.twitter.com) and some thoughts on their API - but most interesting were Evan’s comments on their revenue model.  - Which had me pondering. - and how they will make money has been on my mind for a while.

So here’s the exchange between Michael Arrington (MA) and Williams (EW) from the interview:

MA: What is your revenue model? Do you know yet? Have you thought about it?

EW: We’ve though about it. We had to do some thinking about that to raise a bunch of money, but it’s not actively in development right now. The broad strokes on the matter are obviously Twitter is being used for a lot of commercial purposes right now, in addition to social purposes. We think that works pretty well. We think there’s a lot of companies that we’ve talked to that seem to be getting a lot of value out of it. If that continues, if that becomes a rich world for users and the companies, we think we can extract some revenue from that.

MA: It might be difficult to define commercial activity versus not, right?

EW: It might in some cases, but in a lot of cases it will be really clear. I mean Woot.com is selling stuff. So maybe we just say, this is commercial usage and you need to pay for that and maybe there’s some features you get on top of that, that wouldn’t be as meaningful to personal users. There’s other cases, like yours, is that commercial or personal?

Hmm - now that’s really sketchy as far as I am concerned. To give him credit I think he was vague enough to suggest that he as OK with people knowing they don’t really have a clue yet.

Obviously business 101 = if you have buyers and sellers you may have a market. But who really wants to receive marketing messages via Twitter? That’s problem number one. There are of course COOL brands you may want to follow - like Apple iPhone - or maybe Nike but there are only a handful of brands with that kind of X-factor. Nobody is going to follow a short-term insurer for example. Then there are of course “brands” like celebs. Are they going to try and charge Britney Spears for having a profile. Were do you draw the line? In tech circles Arrington is a shleb. In fact many of us in the blogosphere use twitter as a marketing tool. That is a commercial purpose.

Problem 2 = Sifting out the commercial propositions from the real people will be a nightmare.

Problem 3 = It’s not so easy to say that you may give paying customers additional functionality than an average user because in most cases this will imply being able to spam them better and in any case why would you not give maximum functionality to a user. It would piss me off.

So it is easy to criticise - and I have not better suggestions for twitter at this point - but I do think that they are going to find it very tough.

I would sell to MSN and let them layer Twitter over their chat client as a broadcast chat mechnism to enhance the 1-2-1 chat they already dominate. Then again if MSN thought this, they might as well build it themselves.

Press play for a mid-week laugh : )

So - I don’t really post personal stuff here but this was just too priceless. My amazing missus knows I was a die-hard Chuck Fan long before the craze started and this is what she surprised me with. How awesome!! I also got a swanky Poker chip set and card shuffling machine : )

So I was contemplating the ceiling potential of UGC contribution in SA right now?

We cannot escape the fact that the market is limited and SA users are not really web-cultured/savvy. The critical mass is also not there as we would like it. People are not plugged in and “always on” as in other markets.

I see the 90-1-9 rule playing out on most of our 24.com products. - 1% contribute and create a lot! 9 % a little and the rest just read. 

So extrapolate that to the size of the SA market of 5.6 million local users(according to the OPA stats), and the result is: 

56 000 South African online users are potentially avid generators of content, while another 504 000 will participate. - The rest will just view content.

Note that this assumption applies to user-generated content and not social networking participation. This is a reasonable assumption of the potential in the market in my view.

Arthur Goldstuck did research into the local blog market (December 2007) and asked all local blog providers and aggregators to participate to achieve a view on the total numbers. The result was 3 700 active blogs. We estimate no more than 5000 active currently. - Which means that roughly 0.1% of South Africans are blogging.

In addition to this Amatomu.com according to Nielsen stats has about 8 000 monthly unique users which amplifies the penetration of blogging in SA. It is nowhere near a mainstream activity.

I also realise that blogs are not the only form of UGC - people are also uploading pictures/videos to Flickr, Photobucket, Youtube, Zoopy, Blueworld and all the others out there. 

The kicker to this theory is that SA usage of Wikipedia and Youtube is huge according to both Alexa and Comscore Media Metrix -  but I doubt that people are contributing and rather passively viewing the content.

There certainly is a pure mathematical limit to potential. Another case in point is that we know as a general rule of thumb on may products that 10% of people will register. No matter how good your product is you may move the needle a little but chances of re-writing the rules are slim. 

Why am I writing this? Well with the wave of elation in the web2.0 space we have to honest with ourselves as early adopters and understand that the mass of SA users are not using Twitter, Friendfeed and all the other cool products out there.

Does that represent an opportunitygap in the local market? Maybe. Does this imply that SA start-ups should be thinking global rather than local if you want to get real traction. – Probably.

It’s a real challenge. But these are things to consider when putting down your business plan. At the end of the day marketers are looking for reach among other things and reach is something we grapple with in this market.

I know that IS announced a while ago in June that they were creating a VC-like fund for innovation and yesterday FMtech reported on more of the details.

I just wanted to say well done. It is great that companies such as IS are starting to invest in the SA web and start-ups.

“We are trying to improve the Internet in SA,” IS product development manager Jeff Fletcher said. - and that is a noble and worthy cause.

Our(24.com) investment into Blueworld Communities was a fantastic decision and I am sure Vodacom’s minority share in Zoopy.com will assist them to really grow their presence.

If you are looking to pitch a start-up them to HAVE to read “The art of start” by Guy Kawasaki.  In fact get your hands on anything you can from Guy - he is an apple legend and now focusses on getting start-ups started so to speak. The web is littered with his videos, talks and texts. You MUST do it. I read his book recently and was frothing at the mouth I got so excited. He details the best way to do pitches, plans and presentations. Key elements in getting funding.

I think we are going to see an explosion on the SA web and look forward to it!

So everyone saw the news about domains going ape.

It’s obvious but I just have to say that Google must be licking their lips.

It’s sentimental and quirky but they have never removed “I’m feeling lucky” from the homepage and now there’s a chance it will get  more action in the future.

Either way if this trend does take off then search will become even more nb.

Google’s strength and ranking algorithm has always been to find websites. It is what it was designed to do. It is far worse at finding real info. So this will play to their strengths if things proliferate.

Indecently i am also curious about how much search traffic I will generate via the word Gang bang in my headline - LOL!

Whatever …… I will def register  elanlohmann.unique !! or elan.fun

What will you register?