Magpie: A Twitter Ad Network With Big Possibilities and Problems

Twitter may not have a real business model, but that's not stopping others from figuring out a way to make money on the micro blogging site.

In short: Magpie works by sending tweets under the cover of your profile, but from advertisers. The tweets can be scheduled once every other tweet, every 10th, 50th, whenever. And every time an advertiser tweets under your account, you get paid. You also get the opportunity to approve a tweet before it is sent, so you don't have to worry about sending the wrong message to your followers.

For advertisers, it essentially works on a keyword bidding system. When your chosen keywords match those tweets of a user, and you have the highest bid, you tweet from that user's account.

Details right now are a little spotty, but through some of my own research, I've found that those accounts with at least 1,000 followers are the ones that stand to make some money. Some other factors that come into play are frequency of tweets and topic: the more topical and timely your tweets, the more potential for revenue. And the numbers are pretty lofty. I found some accounts with just over 1,000 followers that could earn several hundred (euro) per month, based on Magpie's calculator.

If you read Magpie's forum, you'll find some mixed results as to its usability. There seem to be several bugs in the system, and communication from Magpie seems slow.

But should this (or a similar service) take off, the reaction you're going to hear is that this will destroy Twitter.

  • Users will hate the idea of getting incoming tweets from advertisers they never "followed." If you're following someone who tweets constantly, you could be seeing many, many ads.
  • Advertisers will find that their message is being lost through multiple dead Twitter accounts. When too many ads start appearing, users will lose followers and advertisers will lose an audience.
  • You will find people setting up Twitter accounts to add followers quickly, solely for the purpose of advertising. Twitter will become diluted.

My guess is that eventually Twitter will have their own system of advertising. And it will likely include opt-in/out controls to keep users happy so they don't abandon the site.