My take is that Twitter is a news source just like I was a news source when I witnessed a man jumping in front of a train that I was on earlier this year. Sure, Twitter is a news source. If someone says something about a topic, it's news. Apparently the horrible attacks in Mumbai last week have cemented Twitter (and all social media) as expert news sources. I mean if CNN says it, it must be so! I've already explained why CNN loves Twitter and other social media, it makes their job much easier. It's interesting that one event has apparently changed the course of news reporting forever.
How well connected is Mumbai with regards to Internet access? It will be interesting to see how less-connected countries (including areas of the U.S.) handle major online news reporting in the future.
The issue with Twitter as a news source is that it's not organized to handle news reporting. Frankly, it's a complete mess. Twitter users are tagging way too many messages, which only adds to the noise. This noise makes allowing potential "real news" to get through nearly impossible. To see this in action, check out the Mumbai search on Twitter. The majority of posts are commentary and reposts of mainstream news (i.e., CNN said...).
If Twitter wants to be taken as a serious news source, it needs to work on how the information is shared, although Twitter should probably first focus on how it plans to generate revenue to maintain a going concern. Perhaps there's an opportunity for a new, quick messaging tool that's for serious news only. There's definitely room in the market and if the tool can stay away from general commentary and personal messaging, it could redefine how news is reported into the major news outlets. Naturally, the tool should support multiple media types (e.g., text, audio, video). If the information submitted to this new news-reporting tool can be verified and noted as such, that could make the tool even more powerful.