Summary:

Dalton Caldwell has been shaking things up with his App.net platform, capitalizing on developer frustration with Twitter’s API platform to build an open developer ecosystem. But under a new system for paying developers, Caldwell shows he’s also taking chances on the business model itself.

Dalton Caldwell

Dalton Caldwell’s audacious proposal for a paid, open developer ecosystem called App.net has already started shaking things up in Silicon Valley, as Caldwell tries to capitalize on developer frustration with Twitter to propose a new business model for an information system. While App.net remains fairly new at this point, Caldwell took another step further in pushing the envelope Thursday, announcing an intriguing new way for developers to make money under App.net’s structure.

Beginning Oct. 1, developers writing apps for App.net will be eligible to participate in the “Developer Incentive Program,” which will financially reward those developers who are creating the most popular and valued apps as determined by those app’s users, bringing revenue back to both the original platform and the developers who write for it.

In a blog post Caldwell said eligible apps could earn a portion of $20,000 per month, depending on how popular their app is and how many total eligible app developers choose to participate. Developers don’t have to participate at all if they’re not interested.

In an interview last month, Caldwell explained the rationale behind the idea: In Apple’s iTunes app store, developers usually only get paid once — when the app is downloaded — not continually, unless they incorporate in-app purchases or advertising. For apps that are free or only charge an initial download fee, the developers aren’t paid based on how much the users like or value the app over time, Caldwell argued.

With App.net’s program, users will provide feedback on the apps they use and like most each month. App.net will then proportionately allocate money to the developers from the App.net yearly membership fees (currently $50, but that could change). It’s like if you could take your monthly gym membership dues and tell the gym which pieces of equipment you want them to spend your money updating and repairing.

In the blog post explaining the incentive program, Caldwell noted that the system is subject to intimidation from developers asking users for good reviews, and developers who do so will be booted from the program. And presumably App.net will need to continue signing new members to provide the platform with revenue to distribute, although based on how quickly Caldwell met his initial sign-up goals, this might not be a problem.

This post was updated at 11:57 AM PT on Friday after the company clarified that all eligible developers building for App.net could earn a portion of the $20,000 per month, not $20,000 individually or per app.

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