Monetizing free services had to happen someday.

twitter money

The web has induced a world of innovation whilst a plethora of free services have hit the market, but without infinite resources these services ultimately have to cover their own running costs. Meanwhile, popular free services are changing their business models, such as Digg and more recently Twitter.

Over the weekend Biz Stone, one of Twitters founders, announced a change to Twitter's terms of service. This change ultimately leaves the door open to advertisers that use the service, with terms stating;

"In consideration for Twitter granting you access to and use of the services, you agree that Twitter and its third-party providers and partners may place such advertising on the services."

Twitter receives around 40-50million visitors a months - more than MySpace in the UK. The move will undoubtedly provide a boost for Twitter's irregular revenue streams. Big brands will certainly take up the opportunity to push their message but Biz has confirmed they are not interested in implementing banner advertising, but target adverts on searches and particular terms.

Many a Tweeter will probably not deny Twitter their pay day, but it will depend on how intrusive the adverts become.

One recent example of successful monetization of a site is Digg. There are a few banner ad blocks on the homepage, but what is interesting is that users can actually 'digg' an advert to make it cheaper for the advertisers. The model has proven an early success and as you can see from the graph below, monthly visits are increasing.

So are you happy to view adverts in return for a free service? Do you think adverts will ruin the user experience? One thing's for sure, more and more free services will see it necessary to monetize their offers, and selling ads seems to be the quickest route to market.

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