"There's a very interesting parallel between Twitter and YouTube. When Google bought YouTube, they did it because it was extremely popular, got tons of traffic and represented this new trend of video hosting and sharing. Now, Google still hasn't found a way to effectively monetize YouTube in a big way," said Allen Weiner, a Gartner analyst, in a phone interview. "Does Google really want to spend another huge amount of money on another extremely popular service that hasn't figured out a way to make money? I don't see it happening."

Others aren't so sure.

In an e-mail interview with IDG News Service, IDC analyst Karsten Weide said Google would gain "tremendous stickiness and traffic" from Twitter. "Microblogging is becoming an accepted new channel of online communications in addition to email and instant messaging, and it is here to stay," he said.

But he agreed that Google needs to know that it's highly likely Twitter will never make significant amounts of revenue. "That would mean -- just as Web mail -- it would be a loss leader that one cross-finances in order to have the indirect benefits," Weide said.

While Google doesn't need to boost its audience, the acquisition might keep Twitter out of the hands of competitors, namely Yahoo and Microsoft, he said. "I think an acquisition would make sense, and if they can get it for less than $1 billion, the better it is," Weide said.