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Twitter man: Tweet ad demand exceeds supply

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Twitter founder Evan Williams says that demand is far outstripping supply on the company's fledgling ad platforms.

"Our biggest challenge right now is that there's way too much demand for the supply," he said – predictably – on Wednesday evening at the Web 2.0 Summit in downtown San Francisco. "We've been ramping up our sales team to get more people in the door. We've kept it small, and we've purposely kept it small, so we can test very throughly and learn from what's happening and get feedback from the advertisers."

He said that the company is serving about 40 advertisers at the moment, but that this will grow to "hundreds" by the end of the year.

The company now sells "promoted tweets," which turn up in Twitter search results; "promoted trends," which pop up in the site's "trending topics," a list of the most popular subjects on the micro-blogging service; and "promoted accounts," which appear in the list of Twitter accounts the site suggests you should follow. Williams said that a promoted trend – where an advertiser can pay for a place on the service's list of most topics – "increases conversation about [the topic at hand] three to six times."

Asked if the company had a "strong" revenue model, Williams said: "The math looks good." Naturally. "The advertisers keep coming back and they want to buy more," he continued. "It's been better than we expected."

Asked how much it relied on Tweet-sharing partnerships for revenue, Williams indicated this isn't all that important. Over the past year, the company has inked deals with Google, Microsoft, and Yahoo! to supply these outfits with access to the Twitter "fire hose" – i.e. the service's endless stream of mini-messages – but Williams said that Twitter doesn't see such deals as a major source of revenue.

"We've got way more demand than we can service for that data," he said. "The point of those deals was never primarily about revenue. We believe that it was good to give more distribution of the tweets. Because the whole point of [the big search engines] is to help people know what's going on in the world and that's where people are going in many cases to find out what's going on, so we thought it was a win-win for us and the search engines to get this distribution...

"But we didn't set this up to be a big revenue model." ®

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