I'm not an app.net fanboi, nor am I particularly hopeful about its chances of success. I have not backed it (though I'm considering it.)
This article is full of bullshit.
> Because the reality of the situation is that if App.net
> ever was successful, it would face many of the same hard
> choices that Twitter now does. Or it would fade away.
Most of the challenges Twitter has come from its inability to monetize, and much of the criticism coming from app.net and supporters is that Twitter is sacrificing its openness in its quest to squeeze money out of the service. App.net aims to avoid these challenges by being a paid service. Further, since App.net has a built-in business model, it doesn't need huge traffic to turn into advertising dollars.
> The truth is that these things rarely work because it’s simply not how
> the world works. People tend to flock to the best services. And the best
> services tend to sprout from the best entrepreneurs. And the best
> entrepreneurs eventually realize they need to build the best businesses,
> lest their services die or worse — linger in mediocrity.
There are a whole bunch wholly unqualified, unsupported opinions and logical leaps here. For one, I don't think people actually flock to the best services (maybe most popular, most exclusive, best marketed, best timed, pick any number of things.) But two, only MG Siegler is defining "best" to be biggest. Dalton Caldwell quite clearly thinks that "best" would account for some things like openness and a straightforward business model. I'm sure he'd love for app.net to be a billion dollar company. I'm not sure that's his definition of success.
> Even if App.net hits its money goal and gets fully built (an early alpha is
> here), it won’t ever grow big enough to truly challenge Twitter. Maybe you
> think that’s fine. Maybe it could exist as a self-sustaining smaller network.
> That’s nice — but that’s not what drives anyone. No one sets out to be
> second-rate. And the best people don’t flock to those services. That’s why
> these things tend to not work.
Same thing here. MG Siegler has decided on a goal for Dalton Caldwell that Dalton doesn't necessarily share.
> App.net looks like the hero right now only because it
> hasn’t had the opportunity to become the
> villain. And it probably never will.
Finally, the world is not a fucking comic book or TV show. There are nuances of decision and balances to be struck that don't translate into comically reductionist ideas of good versus evil.
Most of the challenges Twitter has come from its inability to monetize
Per Crunchbase Twitter has had 8 rounds of funding for a total 1.16 BILLION dollars. Twitter actually did figure out how to monetize, they monetized an extremely small population (VCs) for an extremely large amount of money. Anything they'll get from consumers and brands will be peanuts unless you are looking at horizon much further out than any of those VCs wanted to be in on the deal. Sponsored tweets are going to be feeding the operating expenses monkey.
Looking at the FB/ZNGA/GRPN prices Twitter won't IPO so barring a deus ex machina in the form of an Apple purchase VCs are going to have to accept that they were the monetization vehicle, but nobody will want to talk about it publicly because it doesn't fit the standard narrative.
Seriously? Getting VC funding isn't monetizing. That's not profit, it's an investment. I don't know if this needs to be spelled out, but generally when people make investments they expect the investment to be returned with additional profits on top. Or do you think the VCs are in the business of giving money away?
Breaking even on sponsored tweets is not a sustainable business model just because they got VC funding. If they can't start turning actual profits, that VC money will be pulled out faster than you can type a 140 character message about it.
I think jbigelow76 is talking about 'monetizing' for the founders and early investors with tongue in cheek, and the fact that twitter doesn't have an obvious income stream. Obviously this is not the intended outcome for the VCs.
1. Monetization does not equal profit. Plenty of businesses monetize at a net loss, they just aren't around long term.
2. How investments work does not need to be spelled out, but maybe sarcasm does ;)
3. How do you see VCs (that weren't liquidated out from subsequent rounds) "pulling out" money? Are they going to ask employees to return paychecks, reverse bill AWS or wherever their infrastructure costs are incurred? There maybe money in the bank for operating costs and runway but from the VC's perspective that money is effectively gone.
VC funding is not investing, its speculation. VC money gets burned way faster than it gets pulled out. And generally they aren't looking to earn "actual profits" in the sustainable long haul. Just to generate enough hype to increase valuation for subsequent rounds when they can take their gains by cashing out early on SecondMarket.
I got to visit jail inmates as part of a voluntary effort. I met a person that had killed their parents with a katana, he told me that everybody was an assassin, but they didn't knew that.
I had know people that in the WWII were put a fire gun in their head telling them to kill other people in refuge's camps or they would be shot. They didn't.
Those people had the opportunity to become villains.
This is done today in Africa when there are wars with children being forced to kill their parents(guerrillas recruit children this way), girls being raped. We had to psychologically treat them when they got out of the guerrilla. Some children refuse to do that and are killed on the go.
This article is full of bullshit.
Most of the challenges Twitter has come from its inability to monetize, and much of the criticism coming from app.net and supporters is that Twitter is sacrificing its openness in its quest to squeeze money out of the service. App.net aims to avoid these challenges by being a paid service. Further, since App.net has a built-in business model, it doesn't need huge traffic to turn into advertising dollars. There are a whole bunch wholly unqualified, unsupported opinions and logical leaps here. For one, I don't think people actually flock to the best services (maybe most popular, most exclusive, best marketed, best timed, pick any number of things.) But two, only MG Siegler is defining "best" to be biggest. Dalton Caldwell quite clearly thinks that "best" would account for some things like openness and a straightforward business model. I'm sure he'd love for app.net to be a billion dollar company. I'm not sure that's his definition of success. Same thing here. MG Siegler has decided on a goal for Dalton Caldwell that Dalton doesn't necessarily share. Finally, the world is not a fucking comic book or TV show. There are nuances of decision and balances to be struck that don't translate into comically reductionist ideas of good versus evil.