Clubhouse app: what’s behind the hype?

A mixture of podcast and tele-conference: the new social network Clubhouse promises to make discussions on the Internet more productive again. This is supposed to work by people talking to each other - instead of just typing. With this innovative approach and a clever marketing concept, Clubhouse caused a sensation within a few weeks. We explain what’s really behind the smartphone app and why you need an invitation to participate.

Clubhouse is a free social network that users can access via a smartphone app. While text, images, and videos dominate on Facebook and Twitter, Clubhouse is intended as an audio-only app. Users speak to one another directly, instead of texting at different times. This avoids a lot of misunderstandings. The contents on Clubhouse range from interesting lectures, lively discussions, and business networking events.

The app was created by two Silicon Valley veterans: Paul Davison who gained much of his experience working for Pinterest, and Rohan Seth who previously worked for Google. Together they founded the company Alpha Exploration Co., which oversees the development of the app. The first version of the app was released in the Apple AppStore in spring 2020. While initially only IT insiders and investors were interested in Clubhouse, the app has become increasingly popular in the wake of the COVID-19 pandemic and social distancing measures.

The Clubhouse app initially was not well-known – at least in terms of user numbers. Despite the lack of members, the founders were able to attract large investments early on. That guaranteed its speedy technical development and produced a very successful marketing strategy.

How did the app become so popular? For one, celebrities were attracted to the platform. For example, Oprah Winfrey and rapper Drake are registered with Clubhouse as are MC Hammer, Estelle, Tiffany Haddish, Kevin Hart, Jared Leto, Meek Mill, Aston Kutcher, and many other Silicone Valley entrepreneurs. In Germany, for example, even high-ranking politicians have signed up to the new social network. This created a pull effect which is being deliberately slowed down.

Its developers (at least initially) relied on artificial scarcity: to become a member of Clubhouse, you have to be invited by another user. Every new member only gets to hand out two invitations. Only when you get involved on the platform, can you help other friends to join as members.

The hype surrounding the Clubhouse app comes down to FOMO: Fear of missing out. The fear of missing out on an important development and not being an early adopter generates increased interest in the social network. At the same time, the slow growth ensures that servers and employees of Alpha Exploration Co. are not overloaded in one fell swoop. After all, the app is still in beta.

Want to become part of Clubhouse? Then you need an invitation - or you can join a waiting list. An entry in the list ensures that you can save your desired username. Then you have to hope that a friend (who has you saved as a contact in their smartphone) is already registered with Clubhouse and approves the application. The user does not have to use one of their two invitations for this.

Joining can be faster of course – if someone invites you directly. However, since each user initially can only give out two invitations, the probability of being one of the chosen ones is relatively low.

Other users are already trying to make a profit from the system: resourceful users, especially on eBay, are selling Clubhouse invitations for more than $100 in some cases.

While Clubhouse has broken records and is becoming increasingly popular, criticism of the app has grown. Data protection problems are becoming ever more apparent. Logging into the app means that you’ll be sharing your private phone book. This is the only way the invite system can work. Data from third parties is sent to the platform without people having given their consent. This allows Clubhouse to create shadow profiles for people who are not interested in the app at all. This and the fact that the data protection regulations are not formulated clearly enough is contradictory - according to the opinion of several data protectionists regarding the GDPR.

The handling of hate speech and fake news. is also controversial. The app gives the impression of a closed society, a conversation behind closed doors. In fact, the company itself does not (yet) have any way to monitor content. It is up to the moderators of the chat rooms (any user) to ensure conversations remain civil. This only works to a limited extent. The first complaints about anti-Semitism, racism and sexism have already been made in the USA. The app developers were quick to react and are now making temporary recordings of chats that can be monitored following a complaint. Incidentally, the recording of conversations is prohibited for users themselves.