Alright, if you haven't heard by now there is a new player in the social space, App.net. They are setting up a forever ad free social network, where people who want to use the service have to pay yearly. Right now the price point is $50/year. This of course gets me thinking, because ... well let's face it, Twitter is NOT anything special anymore.
The Early Days of Twitter
The early days of twitter were amazing! Smartphones weren't nearly as prevalent as they are today, and so people had to really work to spread messages to all their following. In fact that is the niche that Twitter filled. Group/Mass SMS for events and groups. When Twitter first came on the scene you would text things to Twitter, and twitter would send them out to your followers. This is where the 140 character limit comes from.
What made Twitter great was that it worked on all phones (as best I can tell it can still be used without a smartphone!).
The Downfall of Social Media
Free is the price point everyone wants to work in now. Free as in beer. However, it is extremely hard to run a company on free alone. As a result companies like Twitter, and Facebook are forced to sell advertising. Depending on how you use Twitter that could result in paid ads in your stream on Tweetdeck (not too bad) or annoying ads being texted to you from your stream on your phone (very annoying). Twitter doesn't know or care how you receive your tweets, as long as you do and they get paid for it.
This is where App.net wants to get into the game. They want to stop making things free, and start making people buy into better experiences. So they set a price point of $50/year. Will it work? I don't know, but I don't think so. The truth is, people don't need Twitter or Facebook. If they both went to charging $50/year, right now, today, they would lose millions of users. People would instantly stop using the service. We have to acknowledge that $50 is cheap too. $6/month! To think people will give up what is the most important thing in their day right now for a mere $6/month. Believe it!
On the other side of the coin is the $100 developer buy in. In order to use App.net as a service, maybe to build the next Tweetdeck, you have to purchase a license to access their API. $100/year is the ticket here. The same that Apple charges to be able to put apps in iOS. So if you wanted to write an App.net app for iOS you are now looking at a $200 start up cost. $125 for Android. Is it worth it?
Although App.net won't be taking revenue from advertisers they are more than welcome to join App.net (for the $50 fee) and SPAM their own feeds as much as they like. Commercial entities are treated just like all other users. You can follow or unfollow anyone at anytime. The difference here is that these posts won't show up in your feed, unless you directly ask that they do.
My Best Bet
Personally I think $50/year is too much for something like Twitter. Even Facebook. I could honestly see people buying for $20/year. Which brings the question of how little is too little? There are factors to consider here. Folks under 18 can't join (no credit card). So parents would need to run their accounts, or some other form of payment would have to be setup. What is the server cost, per person per year? To be honest, $50/year could pay for a single VPS per person. In a sense giving each person who joined their own hardware to interface with, and that would be cool.
Maybe I will spin off the App.net idea, and fire up a $10/year social network.