Google-Buying-Twitter Rumor Highlights Twitter's Business Model

(MoneyWatch)  Suppose we should get this rampant "Google buying Twitter" rumor out of the way. I'm connecting the dots here, but seems there is a correlation between the post on TechCrunch that started it all, the post on Kara Swisher's blog saying that the rumor started because of some "product-related discussions" between the two companies, and a story on Adage.com which says Google is streaming tweets from TurboTax through its AdSense network.

Even though the rumor is increasingly looking like nothing more than that, the headlines that include the words "Google" and "Twitter" are beginning to point at the value of Twitter as a real-time search engine and therefore, at its business model. For fun, I pulled a screen grab, above, of what the trending topics were on Twitter at about 11:30 a.m. EST. It makes for a fascinating snapshot of what the zeitgeist was at that moment in time. (Yes, it is National Cleavage Day; by a half hour later, Twitter founder Biz Stone was a trending topic.)

Advertising has always been about being in the right place at the right time. Twitter has the potential to provide that to advertisers on both a mass and micro scale. That's pretty compelling. The TurboTax case is a perfect example. Taxes are obviously top-of-mind right now, and, through Google's AdSense network, its owner, Intuit, has a great way to get the word out about its Twitter feed to, well, everybody. But, such a model has millions of uses for smaller markets. Mets tickets could be offered to those tweeting Citi Field and so forth.

By the way, I asked Abbey Klaasen, who wrote the Ad Age story, if Twitter was making any money off of the TurboTax deal. Google wouldn't say. She told me that "technically [Google] wouldn't need to have a formal relationship with the company to do what it's doing. My guess is that they are somehow working together but I really don't know if it's more of a tacit 'heads-up-Twitter-we're-doing-this' or an actually revenue share."