Seems to me that 'ad supported' is always going to be more attractive to funders/investors, because the potential is effectively unlimited (certainly by comparison with paid-for services).

With pay-for services, there's a much smaller number of people who are going to (or be able to) pay, and when you start looking at those numbers, it's never the fabled 'hockey stick to heaven' that people dream of.

What if twitter just sold access to their stream, and a few million orgs (companies, individuals) were paying, oh, say, $20/month. And let's say... 2 million - why, that's only $480/million per year maximum! Gosh - who would ever want to invest in that? Instead, by going with 'ads', there's always the promise of some big change that could explode the revenue down the line.