Is this a good idea or bad? Should Twitter have sold off to Facebook?

This story broke this morning from Kara Swisher at BoomTown. Her title is priceless: When Twitter Met Facebook: The Acquisition Deal That Fail-Whaled

Kara went on to discuss the pros and cons of the takeover. First offer vice wait for something better.

I wonder about Twitter’s (Biz Stone, and the other’s) mind set. They are growing by leaps and bounds and their equipment limitations are showing on a daily basis. Functionality has been limited for months now.

Twitter has no identifiable revenue stream though it’s my understanding some costs are recouped via the millions of text messages they send. It’s also my understanding that the costs of this are around $75 million a year. Though never fully disclosed, they are losing money hand over fist.

Facebook is already having trouble monetizing it’s service as is YouTube (Google) and others. The returns are not matching expectations though I believe their financial position is much better than Twitter’s.

Explaining the lack of a revenue stream for Twitter, co-founder Biz Stone said recently:

“Unless we have a reliable service that works the way we think it should,” Stone says, focusing on revenue “is really putting the cart before the horse.”

True. But at what point are investor’s going to start demanding a return on their dollar?