Two days ago, developer and startup founder Dalton Caldwell published an open letter to Mark Zuckerberg accusing Facebook of at first supporting his startup, then essentially threatening to crush it because it was competitive with a Facebook product. The story got a lot of attention in Silicon Valley, provoked a response from Google+ executive Vic Gundotra, and even percolated up to the mainstream media.
Then came the fallout. Investor Marc Andreessen, who sits Facebook's board, decided the drama had revealed a conflict of interests. Andreessen passed his board position at Caldwell's company, Mixed Media Labs, over to his partner Scott Weiss. Caldwell believes that decision was due to pressure from Facebook, which he says has not responded to his letter privately or publicly.
Caldwell may have burned a bridge with Facebook, but now he's on a crusade
"It took a lot for me to put that post up, because I had a pretty good idea of what a mess it would be," Caldwell told The Verge. "People think it's embarrassing or troubling or fear retribution. I think it's important and I'm willing to do it. I'm not really afraid of saying the truth."
Caldwell may have burned a bridge with Facebook, but now he's on a crusade. He is proposing to build an anti-Facebook: an ad-free social network that users will pay for. Social networks like Facebook treat their developers badly because they are under pressure to monetize a free service, Caldwell believes, and he is raising $500,000 for this paid social network, in part to gauge interest. "We believe that advertising-supported social services are so consistently and inextricably at odds with the interests of users and developers that something must be done," says the proposal for the new App.net.
A master of publicity, Caldwell decided to speak out about his experience with Facebook in order to promote App.net. But even with all the press, the project has only raised $148,000 with 10 days to go before its self-imposed deadline. The letter to Zuck had almost 10,000 "kudos" from readers, but App.net has fewer than 2,000 backers with most people committing $50 to the cause. Perhaps Facebook has become so massive, so ubiquitous, that it's hard to imagine an alternative. Idealistic alternatives to Facebook haven't fared so well, even when they're free. Just look at Diaspora, the anti-capitalist social network that couldn't get mainstream traction even after a blockbuster fundraising campaign.
Social networks will eventually become utilities like electricity, email, or the internet itself
Still, Caldwell believes social networks will eventually become utilities like electricity, email, or the internet itself, and writes that selfish networks like Facebook and Twitter will ultimately lose because they're beholden to advertisers over users. Such services owe their success in part to independent developers. When Apple realized that third-party apps could help sell iPhones, the company set about making the process of building apps for the iPhone as efficient as possible.
Caldwell is the latest casualty of so-called "platform risk," the problem independent developers face when they rely on data made available by companies like Facebook, Twitter, and Apple. Developers want to feel confident that they can invest time and money into a platform without having the rug pulled out from under them. Unfortunately, that happens all the time. For example, StockTwits built a site on top of Twitter that made it easy for tens of thousands of traders to talk about stocks using linked ticker symbols called "cashtags" (think: hashtags, but with dollar signs). Twitter just copied the feature, threatening to make StockTwits obsolete.
App.net started out as an app library where developers could create custom pages for their apps that were connected to their Facebook pages. "I got the A-OK, the green light, that what I was doing was kosher, and that I should feel comfortable building a business," Caldwell said. "[Facebook] told me to build the app. For months, they supported me in building it." Then one day he was invited to a meeting where executives informed him he would be competing with the recently-launched Facebook App Center and implied it would be a mistake to continue on his own.
Caldwell could have rebuilt his iPhone app without the Facebook features, but it would have made it almost useless, he said. He abandoned that app, and abandoned Facebook, and Twitter, for that matter. Since publishing his story, he said he's received emails from developers and startup founders who had a similar experience with Facebook. Free platforms will never be trustworthy, he says, because they have to figure out ways to make money — and that often means cannibalizing someone else's profitable business. Facebook's stock slumped to a new low yesterday, a reminder of the intense financial pressure the company is under now that it is publicly traded.
"I sense a shift in what's going on over there."
Caldwell is disappointed in Zuckerberg. "Facebook platform was his idea. It was his big move against Myspace," Caldwell said. "I've been in the Valley for a long time. I know everything he's written. I've met him several times. I know the guy. I think that this is something that he understands. Just for whatever reason, he stopped talking about Facebook as a utility and stopped talking about his platform. I sense a shift in what's going on over there."