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Are App.net's Crowdfunders Being Taken For a Ride?

Posted by samzenpus on from the money-for-nothing dept.

snydeq writes "At least 10,000 people believe in App.net's vision of a messaging platform for Web apps — but it's unclear whether those people will be peers or sharecroppers, writes Simon Phipps. 'Last week App.net reached the milestone of 10,000 users who signed up for a new — mostly yet to be written — social network that looks like an early reimplementation of Twitter. Signing up people to claim user names on an (not vaporware) alpha Web service may not seem surprising or novel, but this time there's a difference: Everyone who signed up for App.net paid $50 for the privilege,' Phipps writes. 'App.net has used the crowdfunding approach, but it's not the same kind of project. While superficially similar — there's an offer of immediate use of its Twitter-clone service and reservation of the user ID of your choice — it's much more speculative. It's crowdsourcing the seed capital for a new venture, crowdsourcing the design, crowdsourcing the testing, and crowdsourcing most of the software that interacts with the venture, all without actually giving anyone but the founder a true stake in the outcome.'"

23 of 95 comments (clear)

  1. Can someone.... by Anonymous Coward · · Score: 4, Interesting

    tell me how this is any different from xmpp+chatrooms+db+php rss feeds?

    Because that's all it would take to create one of these.

    But maybe I'm underthinking it or something.

    1. Re:Can someone.... by stephanruby · · Score: 3, Insightful

      tell me how this is any different from xmpp+chatrooms+db+php rss feeds?

      It wouldn't be.

      In any case, with kickstarters concepts, you don't usually just invest in the idea. You invest in the people first and foremost. For instance, if the creator of a previous online service I had been using and I actually liked, were to start a kickstarters' project, and if his idea was decent (not great, but decent enough), I might chip in $50, even if the project went no where.

      That being said, I don't know the guy. I've never used his previous project before, so I'm just going to watch from the sidelines. I wish him luck. If nothing else, this kickstarters project should be viewed as a meaningful petition that many Twitter addicts (and third party developers) are starting to get fed up with the service.

    2. Re:Can someone.... by poetmatt · · Score: 2

      because they proclaimed "but we're not twitter!"

      the reality is: there's zero guarantee they'll stand up to the government, something twitter actually does.

      So it sounds great, but it'd be a gigantic loss to freedom worldwide if people pick app.net over twitter at the moment. Guarantee that app.net can't afford lawyers like twitter.

    3. Re:Can someone.... by DragonTHC · · Score: 2

      The service is meant for app developers. They are pitching in to get access to the API when it's written.

      --
      They're using their grammar skills there.
    4. Re:Can someone.... by Anonymous Coward · · Score: 2, Interesting

      Decentralization is the only answer to governments. We need a new "SMTP". Well, the SMTP we had before everyone switched to Gmail, Yahoo, Hotmail, blacklists, sender keys and other awful patches to its shortcomings etc.

    5. Re:Can someone.... by dadioflex · · Score: 2

      The service is meant for app developers. They are pitching in to get access to the API when it's written.

      Sssshhh! You're going to confuse the angry mob with facts.

    6. Re:Can someone.... by gl4ss · · Score: 2

      the aim is to be central AND for pay.

      in that context the early signuppers are just that.. early signuppers. they're not sharecroppers and were never meant to be.

      however.. in the context of app.net the kickstarter is just a tax dodge.

      --
      world was created 5 seconds before this post as it is.
    7. Re:Can someone.... by stephanruby · · Score: 2

      the reality is: there's zero guarantee they'll stand up to the government, something twitter actually does.

      Yeah, and how long is this going to last?

      Twitter has only proven that they could be bought with the NBC censorship debacle, going against their own terms of services. Now governments just need to invest millions of dollars in regular ad campaigns with Twitter and then threaten to pull out whenever they want something censored.

      It was actually a pretty smart move on their part. By doing that, Twitter has shown that they can't be intimidated, but that at least they can be bought -- assuming the amount of money is high enough. Perhaps other online companies could learn a thing or two from Twitter. There is profit in not acquiescing to censorship requests right away. If they can't bully you to do something right away, they may pay you handsomely -- if you can hold out long enough until then.

  2. As usual by zubiaur · · Score: 5, Informative

    There is an xkcd for that too http://xkcd.com/1060/

    1. Re:As usual by jon3k · · Score: 4, Informative

      The mouseovers on xkcd are my favorite part

    2. Re:As usual by Noughmad · · Score: 3, Insightful

      There is an xkcd for that too http://xkcd.com/543/

      --
      PlusFive Slashdot reader for Android. Can post comments.
  3. Completely Backwards by agizis · · Score: 4, Insightful

    You have it all backwards. The Kickstarter model gives an opportunity to get products built that *customers* want, and are willing to pay for, without having venture capitalist in the middle, funding everything and demanding their return. The backers' relationship to the project is that they are *paying customer*, which is less than being the owner of the company, but much, much more than just being a *user* of a free service like Twitter or Facebook.

  4. app.net is totally bogus by sootman · · Score: 5, Funny

    Everyone should be signing up for this new service.

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  5. well, duh! by cas2000 · · Score: 4, Insightful

    Kickstarter enables a style of capitalist parasitism that was previously only available to huge corporations to be scaled so that it's accessible to small-time scammers as well as the giant fraudsters:

    Privatise the profit, socialise the risk and expense.

    That's not all there is to kickstarter or to kickstarter projects but it's easy to see why it is attractive to such parasites - the crowd-funding model has most of the benefits of the stock market without the anti-scammer regulations and without having to give annoying outsiders (aka shareholders) a share in what they're funding.

    1. Re:well, duh! by Anonymous Coward · · Score: 3, Interesting

      Wow! I guess that's one way of looking at it...

      There absolutely is the possibility for a scammer crowd-funding returns on their scam – don't get me wrong. That is something everyone who uses them should be on the look out for. In general, they wouldn't lose much (relative to other scams), but with enough people giving a little, a scam could make a killing.

      But you act like this type of scamming is a new thing – it is not crowd-funding which has enabled it. How many scam charities have you heard about, both on or off-line. I would hardly claim Kickstarter and the like have enabled this any more than the internet or even the phone itself has. At least these sites have a bit of protection through a third party, rather than directly giving someone your CC info over the phone or over some fake charity site.

      As for “Privatise the profit, socialise the risk and expense” I can only speak for my own experience. I have relatively recently decided to take a stab at crowd-funding my own project, to see if anyone wants to help – because I have quickly realized it is NOT going to happen without. And I take a (albeit, small) bit of offense with that misspelled claim.

      So far, I have turned down a solid promotion, actually quit my job, taken out personal loans, and burned through my savings in order to work on a project I passionately believe in. When it has all come down to it, though, I do not have the money I need to make it self sufficient before I will run out and need to beg for my job back. I'm sure my experience isn't alone. Crowd-funding is a potential path forward.

      If that is not enough risk for you – there is always the risk that I will be taking by releasing the info of a project which would normally be top secret in order to provide people with the information they need to make a decision on whether or not they would like to help. So if it is not successful, then I'm back to work – saving for a project that I have already told the world about. Oh well – that's what I signed up for!

      In short: You're wrong.

    2. Re:well, duh! by fermion · · Score: 5, Insightful
      I am not sure what protection the stock market gives. The people who invested in facebook during the IPO has lost half their money. The people who capitalized facebook has made money. You could have invested in Microsoft back in 2008 and have lost money due to the stock decline or inflation. People invested in Enron, Worldcom, all under the so-called stock protection, and lost everything. Sure there are now more regulations, but that seem more there to protect CEOs then investors. The reality is that the stock market is not a magic money machine, and there are real risks. The elites has created this myth for the middle class, in the same way the lottery myth was created for the for those with only a dollar to invest, so that we can believe it is possible to live the american dream without working for it.

      Kickstarter is a service that connects people with ideas with people who are willing to risk a little money. 50 dollars is a lottery ticket a week. The rewards are less than a lotter ticket, but so are the risks. If you give $20 and an album is made by your favorite artists, then you get an album. If not you lost twenty dollars, which is about the markup on a concert t-shirt and few seem to have problem throwing money away on that.

      In this case some are choosing to spend $50 to buy a product as opposed to selling themselves to advertisers. I don't know why this makes people so upset? Because it disrupts the current corporate model of monetizing people? Because some people are so cheap that they value $50 more than themselves? Because some people are so risk adverse that all they can do is hide in their parents basements or living rooms? What gives?

      --
      "She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
    3. Re:well, duh! by cas2000 · · Score: 4, Insightful

      Your attitude is exactly what is wrong with american business ethics.

      'caveat emptor' is not a description of a legitimate business model, it's a fucking warning.

      People who are stupid or ignorant or ill-informed or just plain conned by slick salesmen DO NOT DESERVE TO BE RIPPED OFF.

      And those who do the ripping off are criminals who deserve jail time.

      Also, aside from the criminality of ripping people off, even a staunch libertarian type should be able to see that deceptive exploitation of information asymmetry like this inevitably leads to a lemon market, which is bad for everyone: if you can't trust the market at all, the only rational option is to treat everyone as a scammer (and scam or be scammed) or not to play at all.

    4. Re:well, duh! by Rockoon · · Score: 2

      People who are stupid or ignorant or ill-informed or just plain conned by slick salesmen DO NOT DESERVE TO BE RIPPED OFF.

      You know whats stupid? The idea that you can prevent stupid people from doing stupid things by eliminating the stupid things instead of educating the stupid people.

      --
      "His name was James Damore."
    5. Re:well, duh! by Archangel+Michael · · Score: 3, Insightful

      The six scariest words strung together are "There ought to be a law".

      You cannot fix stupid. Some people are so stupid, they actually go looking for stuff like this because of laws that are supposed to prevent people getting ripped off. The problem is, they still are stupid, they still get ripped off, but now, they want the Government to fix their stupidity so they can do it all again next week.

      --
      Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
  6. $50 is way too much. by Jane+Q.+Public · · Score: 3, Informative

    I remember reading that a single member is worth about $1.21 in revenue to Facebook.

    If Facebook thinks it can stay afloat with that kind of revenue, how can App.net justify such an outrageous price? Even if each member was worth ten times that to Facebook... how can App.net justify a $50 fee?

    1. Re:$50 is way too much. by larry+bagina · · Score: 3, Funny

      Keep in mind their target member is an elite hispter doofus that is mad twitter sold out (aka got popular) and is willing to spend $50 a year so they can buy $200 worth of twitter clients for their $2,000 phone so they can tell @world they just took a #shit.

      --
      Do you even lift?

      These aren't the 'roids you're looking for.

  7. Re:That's funny by ganjadude · · Score: 2

    you need to take the pill for it to work my friend, dont mind the padding on the walls.....

    --
    have you seen my sig? there are many others like it but none that are the same
  8. so... by Tom · · Score: 3, Insightful

    It's crowdsourcing the seed capital for a new venture, crowdsourcing the design, crowdsourcing the testing, and crowdsourcing most of the software that interacts with the venture, all without actually giving anyone but the founder a true stake in the outcome.'"

    So, in other words, it's brilliant.

    We are witnesses to a retro dot-com boom, doesn't anyone notice? For the second time, Internet geeks are taking the business world for a ride. Ticket price: A couple billion bucks. There's a number of startups out there with completely insane ideas that get millions in VC funding. The Facebook IPO took heaps of money from the dumb "investors" who jump on every hype, it's not as wild as the early 2000s, but it's the same recipe.

    Now if only I were ruthless enough to pitch a bullshit business plan to a room full of idiots with money. :-(

    --
    Assorted stuff I do sometimes: Lemuria.org