App.net’s failure vindicates Facebook’s business model

Apparently the renewal rate wasn’t high enough to leave a sufficient salary for App.net’s full-time employees (including Caldwell and Berg). Moving forward, App.net will no longer employ any salaried employees.

via App.net can’t pay employees anymore, but promises to carry on | The Verge.

The next time someone criticizes Facebook for ads or monetization of user data, be sure to show them the above article so they can see what the alternative (for all social networks) is.

Contrary to what privacy alarmists would have you believe, free web services like Facebook and Twitter don’t run on air and pixie dust.* Every web service needs a revenue stream to keep running.  As demonstrated by App.net above, user-paid social networking simply isn’t a viable business. Period.

This leaves every free web service with only one option: to monetize the assets they have on hand. Those assets are their users and associated data.

*Neither is data on you actually yours, but that’s a separate discussion.

Advertisements

Author: jdrch

ISTJ, Rice Owl, UF Gator, mechanical engineer. STEM, sports, music, movies, humor. Account mine only & unaffiliated.

Comment

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s