Revenue Model Cop-outs - High Hopes for Twitter

I kind of hope Twitter has a cool and useful revenue model.

I was thinking about this today after talking to a friend of mine at the wharton school about the life sciences startup world vs the tech startup world and how a lot of the life science startups take a lot more money and a lot more time to produce an exit or value whereas you could have a web app startup company 3-5X over in the time it takes to evolve a drug or procedure or piece of technology in the life sciences field.

This lead me to think about Myspace and Facebook. Myspace, first to get huge and basically just plugged in ad networks and then sold brand advertising and then tried to cobble together targeting methods. Facebook, now with an ad platform with pretty solid targeting and a lot more scalable for small to medium advertisers.

But are these really useful and interesting. I mean Myspace has a massive database of bands and comedians and entertainers that use their site as their homepage and their portfolio. Why haven’t they evolved enterprise tools for these users that are more useful. Facebook with its apps and api and facebook connect, why have they stalled on peer to peer payments and are going toward the ad model.

Is the ad model the easy way out? Are ads and ad networks a conduit to not having to innovate? Is facebook and myspace short selling themselves when it comes to being useful to the world and it’s users? Are they stopping short of disrupting companies like Ticketmaster, Paypal, Bank of America? Could Facebook go head to head with Bank of America?

Now what for Twitter?

From ReadWriteWeb quoting Peter Kafka:

Ads will be tied to Twitter searches, in the same way that Google’s (GOOG) original ads did. So a search for, say, “laptop”, may generate an ad for Dell. The ads will only show up in search results, which means users who don’t search for something won’t see them in their regular Twitterstream.

The ads will use the Twitter format — 140 characters or less — and will be distributed via the third party software and services that use Twitter’s API. The services will have the option to display the ads, and Twitter will share revenue with those that do.

Twitter will work with ad agencies and buyers to seed the program, but plans on moving to a self-serve model, like Google offers, down the road.

Read full ReadWriteWeb Article http://loca.ly/ade2jo

I mean surely they will make money from an ad platform but really…..is this the best that they can do? Isn’t there an opportunity for them to put Reuters and Associated press out of business and revolutionize real-time news and real-time headlines? C’mon now, lets be useful!