Early Reports indicate that App.net is not generating very much user engagement. In fact, most of their 10,000 daily posts come from about 250 users, a far shot from Twitter’s 150 million users and 350 million tweets.
Dalton Caldwell built App.net on the idea that a developer ecosystem on a social platform should be paid for by developers and not advertisers. Doing this would create products that in the end would be better for customers. Its a good theory and one that I absolutely support, but he chose to compete with Twitter who already has massive lead.
I often hear startups pitch ideas that remind me of existing already successful companies. When I make them aware of the fact that their idea is not unique and that another company already has a big head-start, their first thought is that they can do it better, they can differentiate their way into the market and succeed.
Apple differentiated its way into the market multiple times with products like the iPod, OSX, iPhone and iPad. Facebook did the same when they entered the market dominated by MySpace and created a better product. So its not entirely impossible to enter a market and outplay an already entrenched player.
App.net solves a problem for the developer, not the end user and this is the fundamental difference that will hamper their growth. App.net developers are going to be tasked with how to differentiate against Twitter and I think its there that they will fail.
For an end user, App.net looks exactly like Twitter and it won’t improve their experience in any relevant way that will make them want to switch.
When entering a market with established competitors you need to make sure that your product differentiation appeals to the end user customer. If your market has many layers as it does when competing with Twitter, your customer is both the developer and the end user and things get more complicated and ultimately impossibly difficult.