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So what is the alternative? We don't want to pay, we don't want ads.. how else can these things make money?

by weavie 10y ago

mrweasel 10y ago
My alternative isn't one that most people would accept, but I'd be fine with money losing companies ceasing to exist. I'm fairly confident that Snapchat could make money charging their users, if the fee is sufficiently small. Say $10 per year, perhaps as an in-app purchase, with the first 6 month being free. We also may have to accept that some of these companies, Twitter seems the most obvious, isn't actually providing anything of tangible value to the average user and therefore can't exist. Of cause if some investors wants to keep throwing money at Twitter to keep the lights on, they're more than welcome. I know I'm not exactly being friendly towards Twitter, but it's a great example of a company that needs to fail. The only reason they don't is because investors have already wasted so much money that they're desperately trying so save it in hope of making the money back, by some miracle. Part of it might also be that investors, journalists and bankers are so heavy users of Twitter that they fail to see that the business isn't sustainable. In the end the user will always be the one to pay the bill. Either by directly paying, or indirectly via advertising.
theseatoms 10y ago
Maybe the alternative is to structure social media platforms as non-profits?
afro88 10y ago
Is it a possibility that these services eventually tank due to this very reason? They just get kept afloat long enough for a run of VCs to make some money, until the sucker VCs at the end put up with the loss from the company folding?
soundwave106 10y ago
I pretty much use Facebook to follow local companies I'm interested in (as it is currently useless for personal interests at this time). I doubt I'm alone in using Facebook in this manner. I've sometimes wondered if ultimately Facebook could monetize off of that. (Even on this angle, the problem right now is that Facebook's ad algorithm is a bit, er, dumb. At least, it hasn't figured out that I'm far more interested in local business X, Y, and Z that I'm following and not whatever unrelated spam some megagiantcorp is pushing...)
- ojosilva 10y ago
  Following companies is a "pull" method that would not generate significant revenue. Facebook corporate customers want to be able to push, and that's why we have ads. I firmly believe product placement, and the information exchange that surrounds it, is _the_ monetization scheme. Unfortunately, not only Facebook's ad algorithm is broken, but pretty much everyone else's. They have come a long way nonetheless, ad targeting today is one order of magnitude better that it was only a few years back. People want advice not advertisements. When someone has money to spend and a need to fulfill, to have the right "advisor" is an incredibly valuable asset. Imagine a bot that knows my tastes, my assets and basically my life. This advanced bot could psyche me, at the right time, into making valuable and exciting purchases. A bot I could trust would succeed turning my money into happiness. That's the direction current algorithms have taken, with ever-increasing (and rather suspicious) omnipresence in our lives, grabbing any input they can get their hands on. The key difference is that companies look after their interests instead of mine.
marssaxman 10y ago
Why do they have to make money? The infrastructure is only non-trivial because it's being centralized; if we ran this sort of thing as a distributed network, it could be done "for free".

So what is the alternative? We don't want to pay, we don't want ads.. how else can these things make money?

by weavie 10y ago

So what is the alternative? We don't want to pay, we don't want ads.. how else can these things make money?

My alternative isn't one that most people would accept, but I'd be fine with money losing companies ceasing to exist. I'm fairly confident that Snapchat could make money charging their users, if the fee is sufficiently small. Say $10 per year, perhaps as an in-app purchase, with the first 6 month being free. We also may have to accept that some of these companies, Twitter seems the most obvious, isn't actually providing anything of tangible value to the average user and therefore can't exist. Of cause if some investors wants to keep throwing money at Twitter to keep the lights on, they're more than welcome. I know I'm not exactly being friendly towards Twitter, but it's a great example of a company that needs to fail. The only reason they don't is because investors have already wasted so much money that they're desperately trying so save it in hope of making the money back, by some miracle. Part of it might also be that investors, journalists and bankers are so heavy users of Twitter that they fail to see that the business isn't sustainable. In the end the user will always be the one to pay the bill. Either by directly paying, or indirectly via advertising.

theseatoms 10y ago

Maybe the alternative is to structure social media platforms as non-profits?

afro88 10y ago

Is it a possibility that these services eventually tank due to this very reason? They just get kept afloat long enough for a run of VCs to make some money, until the sucker VCs at the end put up with the loss from the company folding?

soundwave106 10y ago

I pretty much use Facebook to follow local companies I'm interested in (as it is currently useless for personal interests at this time). I doubt I'm alone in using Facebook in this manner. I've sometimes wondered if ultimately Facebook could monetize off of that. (Even on this angle, the problem right now is that Facebook's ad algorithm is a bit, er, dumb. At least, it hasn't figured out that I'm far more interested in local business X, Y, and Z that I'm following and not whatever unrelated spam some megagiantcorp is pushing...)

ojosilva 10y ago
Following companies is a "pull" method that would not generate significant revenue. Facebook corporate customers want to be able to push, and that's why we have ads. I firmly believe product placement, and the information exchange that surrounds it, is _the_ monetization scheme. Unfortunately, not only Facebook's ad algorithm is broken, but pretty much everyone else's. They have come a long way nonetheless, ad targeting today is one order of magnitude better that it was only a few years back. People want advice not advertisements. When someone has money to spend and a need to fulfill, to have the right "advisor" is an incredibly valuable asset. Imagine a bot that knows my tastes, my assets and basically my life. This advanced bot could psyche me, at the right time, into making valuable and exciting purchases. A bot I could trust would succeed turning my money into happiness. That's the direction current algorithms have taken, with ever-increasing (and rather suspicious) omnipresence in our lives, grabbing any input they can get their hands on. The key difference is that companies look after their interests instead of mine.

marssaxman 10y ago

Why do they have to make money? The infrastructure is only non-trivial because it's being centralized; if we ran this sort of thing as a distributed network, it could be done "for free".