Summary:

Dalton Caldwell’s SXSW panel title ended in a question mark, and he said that question mark was there for a reason: “Is there an Alternative to Ad-Supported Social Networking?” Caldwell is working with App.net to find out.

Dalton Caldwell knows that a lot of people are doubting his future with App.net. But Caldwell? He’s not stressing over picking the harder path.

Dalton Caldwell talks about his App.net project on March 9 in Austin at SXSW.

Dalton Caldwell talks about his App.net project on March 9 in Austin at SXSW.

“It’s important to question assumptions about why things are the way they are,” the entrepreneur said Saturday in Austin at SXSW to the crowd in his typically passionate style.

And Caldwell knows the road less traveled. After previous ventures in both an ad-supported music startup and a photo-sharing site, he launched App.net, a paid developer platform (that was commonly but mistakenly referred to as the “paid Twitter”) last summer to much fanfare.

Caldwell has been working since then to make something out of his pledge to grow a network where people pay for — and own — their data. “I think that you are what you eat,” he said.

But just a few weeks ago, Caldwell surprised some people when he announced a free tier to App.net, which seemed at first antithetical to the idea behind the service. But Caldwell pointed to business models for Github or Dropbox and said a freemium tier can be highly profitable when done right.

“I don’t think people will use software because they think it’s good for them, or that it’s better,” he said. “But my approach is that we will make better software that people will want to use.”

Caldwell said immediately before launching the free tier App.net had 32,000 paid members, and now just a few weeks later, they’re at 51,000 total users, both paid and free, which he thinks has big implications for convincing developers to build for the platform.

While it was initially called a “paid Twitter” by a good number of people, Caldwell has repeatedly emphasized that App.net is actually a paid developer network that can serve as a platform for a lot of different apps (think Amazon web services or the plumbing and infrastructure people build their houses on.) Some developers have questioned whether they’d ever use those services if the average user membership to App.net itself is so low (just imagine the contrast with Twitter’s 200 million active users). But if a freemium tier can attract some more people, it could grow the audience and thus give credence to Caldwell’s idea that social networks should find a way to support developers and do right by the user.

“Like, if Vine users can’t find friends with Facebook, that sucks. It’s stupid. It’s only to protect business model interests,” he said, of Twitter’s decision to protect its social graph. But then again, Caldwell knows that the path for Twitter, which is ad-supported, is not easy.

Someone asked how Caldwell would have negotiated Twitter’s relationship with third-party developers this summer if he himself were a Twitter employee. Would he have done things differently?

“I’m not sure I could do anything different if I were in his shoes,” he said.

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