Om Malik has posted an entry on how Twitter could monetize and make money off their service, especially from the ultra-power users like Robert Scoble and Leo Laporte. But there are a couple of points that he has gotten wrong there.

1. His hypothetical 30 GB of data transfer for Scoble alone does not take into account what is Twitter's major problem: tracking. Scaling for known relationships are relatively easy, because you are dealing always with a finite number and you are also dealing with spikes that can be guessed to a great extent. The case is entirely different with keyword tracking.
2. It ignores Twitter's Jabber problems, which will gradually grow to eclipse the problems it is having with API, which is throttled anyway at 70 (60, says Aditya in the comments) requests in an hour.

Realistically, I don't think Twitter can continue the Jabber service the way it is being run right now. They will need to limit tracking per user to maybe a maximum of five, so that the entire tracking mess can be brought under control. If you want to track more than that, you need to pay. And people who normally track more than four or five terms are likely to be PR or other professionals who can afford to pay for the service. This one avenue for them to get some money back into the system.

There needs to be a premium API endpoint, which does not have the 70 requests per hour limit attached to it. The current API client experience is very laggard and there is an opportunity there to scale the API much easier than scaling either Jabber or the tracking service. Once you kill the Jabber service, the premium API becomes the only available service from which you can get a user experience that is closest to the IM-based interface to Twitter.

Lastly, they need to kill the SMS push service. All push services on text leaks money like sieve and they should make it a pull-only service, so that they can recover at least a part of the cost they spend in sending a text message to the user.

business models, scaling, twitter, twitter