Associated Press starts ads on Twitter with Samsung as sponsor

Mon Jan 7, 2013 5:44pm EST
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By Gerry Shih and Jennifer Saba

SAN FRANCISCO/NEW YORK (Reuters) - The Associated Press began using its official Twitter account as an advertising platform on Monday, as the news organization seeks new forms of revenue.

Samsung Electronics Co Ltd was the first sponsor on the @ap account for breaking news, which is followed by 1.5 million Twitter users. The South Korean electronics maker's initial "SPONSORED TWEET" promoted its events at the 2013 Consumer Electronics Show in Las Vegas this week.

AP did not disclose financial details of the arrangement.

Twitter, which sells ads directly to make money from the social media's monthly base of 200 million users, will not receive any proceeds from the AP-Samsung deal.

The AP called the initiative part of a new business strategy and stressed that sponsored tweets will clearly be labeled to differentiate them from news tweets.

The ads provide AP a new income source as news organizations from newspapers to television face severe revenue declines in the face of high production costs.

While the AP was founded in 1846 by U.S. newspapers as a breaking news conduit, only 22 percent of its revenue comes from member fees. Photo licensing, advertising on its news application AP Mobile and YouTube channel are other revenue streams.

The rise of ad deals reached independently of Twitter could undermine the social medium's own offerings.   Continued...