- 24 Nov 08, 09:35 GMT
Just about every Web 2.0 firm has got a business model which depends exclusively on advertising - and right now a lot of those plans look very shaky, as online ad revenue starts to flatten.
What that means is that millions of users of everything from social networking sites like Facebook and Twitter to video sharing businesses like YouTube and Seesmic may find those services either more annoying to use - or may see them disappear altogether. The days of free content with no ads and no aggro are drawing to a close.
So why am I just a little troubled by an advertising scheme which could make Twitter - a social network where I spend far too much time - more viable? The scheme is called Magpie, and it encourages Twitterers to sign up and then act as a vehicle for small ads to be inserted alongside their tweets. The deal is that they match keywords to your "tweets", then post "magpie" tweets in your name with adverts, and you then get paid for that. I was struggling to understand how it worked and asked my Twitter followers - one explained it rather nicely.
"It's a very simple three-stage process. (1) Sign up to Magpie. (2) Ad-tweets appear in your stream. (3) All your followers block you."
That of course is the problem. We, the users, don't see Twitter as a business but as a place where we go to hang out and talk amongst ourselves. If you met a friend in the pub and he casually inserted into the conversation "thought of taking the Daily Beast? you really should - there's a free DVD with every copy...", you would quickly decide he was a friend no more.
But of course Twitter does need to start earning some money pretty quickly if it is going to survive in these difficult times. The trouble is, Magpie is not owned by Twitter - it appears to be a joint venture based in Berlin and Birmingham - and it isn't clear whether any share of the revenues from these ads will head off to California to the firm which actually makes them possible.
Somehow the owners of everything from Faceboook to Twitter to YouTube are going to have to find ways of monetising them more effectively. But turning social users into online billboards sounds a surefire way of losing their custom - so you won't be finding any Magpie ads in my twitterstream.
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