Why the World Will Beat a Path to Path

12/20/12Follow @wroush

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opening up its service to third-party information such as running maps and exercise data from the Nike+ GPS and Nike+ Fuelband devices.

Having raised a comfortable $41 million treasury from Kleiner Perkins Caufield & Byers, Index Ventures, Redpoint Ventures, and a panoply of famous angel investors, Path isn’t under pressure to deliver revenue immediately. But thanks to Fanning’s history at Napster and Morin’s history at Facebook (where he led the development of the Facebook Platform, now called Facebook Connect), the startup is definitely under a spotlight—and sometimes a microscope.

Morin’s response to the “Addressgate” episode this spring revealed a lot about the company’s character, and if you ask me, it came out looking okay. The controversy started when a developer in Singapore noticed that the Path app, in the process of helping users find or invite friends to connect with, was uploading the address books on users’ iPhones to its servers without offering an opt-in screen. This was standard practice in the mobile sector—there was hardly a social app that didn’t do the same thing—and it wasn’t prohibited by Apple’s interface guidelines. But Path got called on it first.

Users found the practice to be creepy and invasive. Journalists blasted the company: sucking up address data without permission was “somewhere in murky waters between identity theft and overly aggressive marketing tactics,” wrote TechCrunch’s Alexia Totsis. Morin responded to the criticism almost immediately by issuing an apology and deleting all existing address data. Shortly thereafter the company added an opt-in screen and started encrypting all address book data coming into its servers.

I asked Morin whether he felt Path had a greater responsibility to respond to users’ concerns because of the high expectations that have surrounded the startup from the beginning. “Because of the spotlight, maybe,” he said. “But greater responsibility because of our values, yes. We are building a personal social network for your private life, so we really deeply care about privacy here.”

In the address book case, Morin says, “We were doing something that was a best practice, and it was one of those things that we stepped on a land mine and we didn’t even realize it. Because that value matters so much to us, we can go out, we can apologize, we can say we really didn’t mean to do this, but to us actions speak much louder than words. So we went and we deleted everything and now we’ve encrypted everything. You can say things, but you have to do in order to really communicate, I think.”

Only time will tell whether Path can live up to the values Morin professes, and whether it can find a way to earn real revenue without getting into bed with advertisers or degrading the quality of its service. But building a base of passionately committed users, while pursuing design innovations that make the most of the mobile platform, is a good way to start.

“If I can’t figure out [how] to say ‘Something we have made is worth your dollar,’ we haven’t done our job,” Morin says. “That is what we are shooting for. And look, we are still a baby company. We have barely started walking. So we’ve got a lot of work to do. But that’s our dream.”

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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