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Comment by huggyface | Hacker News Reader

This 'startup' is one of those things on HN that really leaves me scratching my head, sure that there must be much more that I'm missing. Is this really it?

And to Gruber's pitch, is it because he has a vested interest, financially? Is his "backing" that he pitches it for others to financially contribute?

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One of the nicest things about Apple products is the simplicity of the underlying business model: you get hardware (most generally, also some software and services like AppleCare) from them, and you give them money in return. I think Gruber is a fan of this approach.

Apple's brand and future success then depends on you loving the product, which means they spend a lot of the money you've given them on hiring smart and dedicated people to build more loveable products. It's a virtuous cycle.

But most web-era companies (like Google and Facebook) have adopted a different business model: you get their product for free, with the trade-off being that you have to look at a few ads here and there.

The problem with this approach is that they end up hiring more smart and dedicated people to work on advertising techniques, sales, UI, algorithms, &c. than those who actually work on building ever more loveable product. (And they might even IPO at a high valuation, putting even more pressure on the company to deliver advertising revenue growth.)

App.net is trying to get back to the virtuous cycle of people paying for nice products – that has been the standard in commerce since the beginning – so that they can concentrate on making a great, benign product as opposed to spending the future fretting about 'monetization' (think about how awkward that word really is!) or advertising.

It's a trend I'd love to see more of, and I hope that everybody here gives backing a second thought.

EDIT 1: Gruber obviously carries some sway, the total grew by $1850 in the last 10 minutes.

EDIT 2: To continue the above, the total grew by $15000 in the last 2 hours.

you get hardware (most generally, also some software and services like AppleCare) from them, and you give them money in return

Is it so simple? Does anyone actually believe that Apple considers the transaction complete when you walk away with your shiny new Apple device?

They want to be your content middleman. They want to force you to shop in their store. They want to push the iAds service. I get emails from Apple pushing books and movies and iPads for universities and so on literally nightly. They have a store full of apps trying to foist smurfberries on the kids of unsuspecting parents naive enough to implement an App Store passwords.

I like the general concept -- I was one of the earliest and most fervent proponents of micropayments as opposed to advertising driven sites -- but the dichotomy presented is false. Businesses don't act like that. I pay my cable company for cable and they keep sending me magazine subscriptions. I buy a $40,000 car and they try to foist services (XM Radio, OnStar) on me, and then they try to sell the data about me to interested parties.

The world is a very complex place. Twitter and Google wouldn't exist without their users, and anyone who pushes the simplistic "if you aren't paying you're the product being sold" line has a position that only has merit if you don't actually think about it for long.

Of course Gruber carries weight, which is why I asked about his personal "investment" in this -- he seems to essentially be putting his reputation behind something that is almost certain to fail.

Who actually likes getting magazines from the cable company or car dealerships foisting other services? Isn't there room for a different kind of business model? Vimeo is a good example. Unlike Youtube, Vimeo doesn't advertise and charges users for premium service. And for a certain types of content producers that makes it a much more attractive platform. Hence you generally see artistic works with high quality standards there vs. attention-grabbing fluff.

Okay, so it's not a dichotomy, but doesn't the comparison still makes sense?

Apple is way over toward the "pay for the product" end of the spectrum, and conversely Twitter are committed to the "selling the users' attention" business model.

Even if the difference is not clear cut, people who like Gruber expressly favour one side have reason to want more of the kind.

If you have near-zero marginal costs and you benefit from user numbers, charging basic users is completely insane.

In context, 'backing' means Gruber has committed to one of the join.app.net supporter tiers: paying money in for expected future services.

Noting that the money will be refunded if there aren't enough backers. This guarantees a non-trivial customer base and makes it a lower risk investment.

Gruber is pretty clear that he wants this to succeed because Twitter is getting shabby.

I don't see why his express opinions are always second guessed. (e.g. Does he own Apple stock? Is he concerned about Google?)

Is it so implausible that he actually believes what he says he believes? Why?

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