How do you solve a problem like Twitter?

Fred Wilson feels moved to apologise for a comment he made re Twitter's business model - or rather its lack of a shiny new one now that Free is no longer as fashionable (aka less people are willing to write the next funding cheque). He said:

“It’s like the stupidest question in the world: How’s Twitter going to make money?," said Union Square Ventures’ Fred Wilson, another investor. "It’s like 'How was Google going to make money?'

Fred feels this is wrong, and in a sensible, hard ars*d business way it is.

But there is another side to the Twitter Question - how does a service so unreliable, so derided and scoffed at, still continue to grow strongly and delight its users? Like Google, it has a certain something going for it which anybody looking at it can see is extra-ordinary. There is clearly something about its user experience which works. And that means it is potentially very valuable.

As to a business model - well, I don't think its just a social network, I see it also as more of a "2.0" style Unified Comms system - think email with pictures - and its in that intersection where - imho - its eventual business model will lie. But I don't think it has all the facilities that you need in a "New Telco", so to my mind that implies its not a standalone business, unless it can find revenue by being integrated into multiple service stacks.

I've noted before that mobile players could do worse than use it as a traffic driver, selling it into their service bundle - imho its ideal for mobile Socnetting - and UC for that matter, its a built-for-m2m-service too imho.

However, endgame must be to find a large player who would get strategic benefit from owning Twitter (eg that mobile traffic) - there has to be a sale of some sort. Telcos, Telco wannabees and media Co's with global aspirations come to mind.