According to a recent US cellular company commercial, 26% of people have no idea what Twitter is. But those of us who do are quite familiar with the little blue twitter bird, the who-goes-there owl, and the most amusing Fail Whale. We may also be aware that Twitter doesn't really have much of a business model. There have been the usual discussions of monetization: bringing in advertising, selling to Google, etc. But, with the popularity of its intellectual property, Twitter may not need to monetize its service. It can license its icons.
There are already a few Twitter-related products out there. Zazzle has a complete line of Fail Whale items, including baby onesies. Walmart has a line of bedding that includes owl and bird shaped pillows that quite resemble the twitter characters, as well as sheets sporting a variety of small twitter-shaped birds. It is unclear if any of these items are actually licensed from Twitter, but it does show there is a market for Twitter merchandise.
Perhaps it's time to think outside the box and look to sources beyond the internet for revenue. Twitter has branded itself well and, unlike most internet services, has associated some cute and loveable characters with it. Fail Whale might not replace Mickey or Hannah Montana, but there are certainly people who like to see more of him and his pals, offline.
(I for one, would like some twitter-bird covered fabric to make a nice sundress. But then, I am typing this in a dress printed full of ladybugs.)