Twitter isn’t just booting other ad networks out of its stream. It now plans to tax some start-ups and publishers that are making money from the service.
That’s a pretty significant change for the company, which has previously allowed anyone to do just about anything with its data, without asking for a cent.
But that’s over, based on the new terms of service the company released today. The relevant excerpt:
In cases where Twitter content is the basis (in whole or in part) of the advertising sale, we require you to compensate us (recoupable against any fees payable to Twitter for data licensing).
That’s potentially a big deal. It’s also quite vague. And after talking to Twitter COO Dick Costolo this afternoon, I’m pretty sure that vagueness is intentional. Because I’m not sure Twitter knows exactly how it wants to proceed.
But I did extract some specifics from Costolo:
- Twitter is only focused on sites and services that sell ads against its stream. So if your service doesn’t generate revenue, or does so using something other than ads (i.e., subscriptions, analytics packages, etc.), you’re fine.
- If you do have to pay up, there are a couple of different ways to do it: You could cut Twitter in via a revenue split or agree to license its data stream, which has generally been free up until now. Or you could agree to use Twitter’s own “Promoted Tweets” ad service. Or some combination of the above.
- Costolo says the company hasn’t established a minimum fee, revenue split or another metric for payments. So a lot of this is going to get hammered out case by case.
Okay. But who, exactly, is going to have to pay up? Twitter’s terms aren’t clear, and while I went around and around with Costolo about this over the phone, I’m still not sure. Because I don’t think Twitter is sure.
Start with the easy stuff: If there’s nothing else in your service beyond tweets and you’re selling ads against those tweets, you could be paying.
“When we’re talking about cases where Twitter is clearly a key component of how a page is monetized, we need to have a commercial relationship,” Costolo said.
That sure sounds like TweetUp, the new “AdSense for Tweets” product that launched today, despite what CEO Bill Gross told me this morning. And it doesn’t sound like Muck Rack, a Twitter aggregation site owned by Sawhorse Media–because there aren’t any ads on Muck Rack. But if owner Greg Galant decided to start running Google (GOOG) AdSense ads on his pages, he might end up paying.
Except that Twitter says it’s not looking to find all the developers and publishers out there selling ads against the Twitter stream and tax them. Size matters, for one thing.
“We’re not trying to prevent people from building businesses,” says Tony Wang, a Twitter business development executive who joined my call with Costolo today. “We’re saying if there’s this thing you’re doing, and you’re selling ads against it, and it’s really big, we want to participate in that.”
So is Twitter only interested in really big publishers who use Twitter? Not necessarily. I asked Costolo about the Huffington Post, which has prominently embraced Twitter and uses it frequently to fill out its pages. Like this Twitter widget under a grisly story about a gored bullfighter (careful!).
That’s probably fine, Costolo said. But what about Huffpo’s “Twitter editions,” which are primarily made up of tweets? I’ve asked Costolo about those in a follow-up email, but haven’t heard back yet. My gut: He’s not sure yet. Which is going to make for lots of interesting conversations in the coming weeks and months.
UPDATE: Here’s Costolo’s response, via e-mail, on the Huffpo question. Not surprisingly, he heaps praise on a big Web site that helps Twitter increase its distribution. Though note he does mention plans to “monetize…together”:
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