There actually is a deal in place between Google and Twitter, but it's not an acquisition (contrary to a report by Techcrunch).
Google is selling marketers a service that streams their five most recent Tweets across the AdSense network. Intuit, Google's first customer for this service, as reported by AdAge, will direct people clicking on those "ads" to the Intuit Twitter stream rather than its Web page. (Anyone remember when people called them "hotlinks?")
The idea behind the campaign is not to drive direct sales, but to get people to "follow" Intuit, which is a pretty savvy way to try to create a community around its service. It's certainly less of a turn-off than a bald marketing pitch.
So it looks like this is the deal Google and Twitter have been working on, and not an acquisition as Michael Arrington breathlessly reported. Unfortunately, in her zeal to twit Arrington, AllThingsD's Kara Swisher missed the actual story.
Their public spat leads me to believe that maybe the whole problem with the media industry isn't the business model after all--maybe if publishers actually provided a service instead of engaging in hissing matches, their readers might stick around.
Just a suggestion.