Even though Twitter is quickly turning in to the way most people communicate with each other, it’s starting to get so unstable, it’s barely usable. This is the reason I hate it. You would think that they would figure out a way to fix these problems, but it might have something to do with the monetization issue. It’s hard for a company to invest money into a product, if there is no real way to get a return on the investment.
I really can’t think of a way they could make money. Any advertising would most likely be overlooked by the tech savvy users of the service. The only other kind I could think of is something Facebook did with its Beacon service, but we all not how bad that turned out for Facebook.
I think services like Twitter will be short lived in the long run, for that reason. The life cycle for Twitter-like services will be as follows. Launch > Gain popularity > Grow faster than its resources > Find no way to grow resources > Become plagued with server outages > Die once something else comes along > Repeat
Using this formula, I think Friendfeed will be the next jump for Twitter users, since a lot of them are already using it. Once Friendfeed works out a few minor problems, Twitter better shape up or else.