App.net and a paid user ecosystem | Hacker News Reader

App.net and a paid user ecosystem

n1c.github.com

9 pointsn1c7 comments

People, not the least of which is the founder, keep proposing plans to divvy up the App.net subscription fee among third party app providers.

Such schemes worry me. The incentives are all wrong. App developers must fight each other for their share of a fixed number of dollars-per-customer. It'll be like Lord of the Flies in the app store. This is no way to grow a developer community. It'll be trade secrets and whispers and bitterness and dirty tricks.

As more and more popular apps come out, your revenue-per-user will tend to drop irrespective of the virtues of your own app.

How does one set the overall price? Pricing a simple service is hard enough.

And how much energy will App.net dissipate in building a complex profit-sharing infrastructure, adjudicating disputes, policing new and exciting forms of fraud?

Keep it simple.

>Sure there will be some complexity around what defines your cut

This glosses over the whole problem with this model. The more apps there are, the more you have to share out the subscription income. At some point, there will be so many apps that there is not enough subscription income to cover them. And how do you judge the value of each app?

Besides that, I really don't see the problem with ads. I buy things all the time, I want people to sell to me. What I don't want is people selling me crap I don't want, but I have zero problem with people selling me crap I do want.

I'm perfectly able to filter advertising online, it does not interfere with my browsing at all.

Ads aren't the problem. Privacy is the problem. But you got to let sellers know what you're interested in for them to sell you the right stuff.

Ads are the problem, because they turn you from the customer into the product. When the site starts tuning itself to produce more clicks for the advertisers, rather than for a better user experience, that is a problem.

It's not as clear cut as that.

Advertisers expect viewers > viewers expect a good product

Why would a company, whose revenue depends on lots of users, build a crappy product that loses them those users and hence the advertising money?

Ads are not the problem. You can still build a good product based on advertising revenue.

It's also zero-sum, which is self-defeating.

well theoretically, as the more apps come in, more users will join, so there will be more wealth to be spread around. Though - I don't see myself paying for a social network ever.

This is a bad way to think. Many of the costs of running a business are per-user, so revenue must also be measured per-user.

As users join the per-user revenue stays the same (to first order) but as apps join the revenue-per-user-per-app tends to drop.

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