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TheStreet Open House

Should Twitter Charge the 1%?

Stocks in this article: FB

NEW YORK (TheStreet) -- As investors build their idea of Twitter's current and expected valuation, few appear to believe the 230 million member micro-blogging site would ever go to a subscription model.

Currently, Twitter is being valued on the revenue it earns from a narrow set of advertising services it offers to prospective marketers. Twitter offers paid promoted Tweets. It is trying to enter TV advertising markets by catering to traditional cable and broadcast media content.

The company also licenses data it collects from interactions on its network, in a business some analysts say is similar to the "big data" analytics operations of more established tech players like Google (GOOG) and IBM (IBM).

However, there is little talk of San Francisco-based Twitter charging users to access its platform.

Twitter, after all, has championed free speech in recent uprisings across the world. The company can also be relied upon as a crucial element of disaster response when tragedy strikes and it offers each of its users a new voice in internet communication.

Charging people would appear to be antithetical to Twitter's motives and its appeal.

I am not so sure.

No options are completely off the table after the company sells its shares to stock investors, in an initial public offering that will offer the company's shares at a range of $23 to $25 a share and could value the burgeoning media and technology powerhouse in excess of $13 billion.

Simply put, some people benefit from Twitter more than others.

While the vast majority of Twitter users toil in obscurity and are likely to experience the network as a feed of updates and posts from people they follow, the Twitter elite do generate tangible benefits.

Currently, Katy Perry, Justin Bieber, Lady Gaga, President Barack Obama and Taylor Swift own the most followed Twitter handles, each with over 35 million followers, according to Twitaholic. For the likes of Perry, Gaga and "The Biebs," their handles can be used to promote concerts, new albums and live events that generate real money.

Kim Kardashian, for instance, is reportedly paid thousands of dollars for some Tweets. Ad.ly, a startup backed by venture capitalists like Greycroft Partners, offers a service to give advertises as prominent Coca Cola (KO) and AT&T (T) access to the followers of celebrity Twitter handles, albeit for a fee.

Sports stars are able to build their brands using Twitter handles, media organizations, TheStreet included, are working to drive traffic through their Twitter presence.

Politicians as prominent as President Barack Obama use Twitter to drive social campaigns and votes.

The list goes on.

In a world where the 1% and even the 0.1% have generated most of the income gains since the Great Recession, it is no surprise that the elite would also generate the biggest gains from Twitter. The question is whether Twitter will consider monetizing the benefits the platform provides to its biggest users, given how much they receive from the free platform.

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