That's in the short term of course. Twitpic is essentially a feature on top of Twitter and without Twitter, Twitpic wouldn't exist. In the end, if Twitter implemented picture hosting themselves, Twitpic would surely slowly die.

That's daft. Funding isn't a liability (in the financial sense), and those numbers don't say anything about growth prospects.

For me, the most amazing thing is the "time to hockey stick": Friday night he starts hacking, and by Monday it's getting blogged about and going viral. That is an amazingly short amount of time to build something people want. Most of us have to iterate a long time to achieve that.

Fantastic point.

In terms of scaling, how much larger is twitter than twitpic? $160 Million larger?

That is one way to look at it but the headline says. 'Twitter makes nothing.' So the comment is about setting the record straight, not comparing business models.