4 ms·

Why does everything in the future-web have a price tag attached? If anything I want less business middlemen on the web period. I don't understand why funding th

by aimor 4y ago

Why does everything in the future-web have a price tag attached? If anything I want less business middlemen on the web period. I don't understand why funding through direct sales will give a better product than funding through advertising: "And yes, the non-zero price point will mean you have to budget it with your other costs. But faster access to higher quality information will make you much more competitive globally, so you can decide if the investment will be worth it, like any other purchase you make. This will in turn incentivize these products to be even better, a positive feedback loop driven by entirely aligned incentives." For businesses I think this effect is only driven by competition regardless of revenue model.

jchw 4y ago
I hate to seem condescending, but the "why" is basically what the essay is about for the first 75%. The issue that advertisements have is that the incentives and desires of advertisers usually misaligns with users, sometimes greatly. It's not a concept that's particularly new; for example, take Wikipedia's reasoning for not accepting advertisements. (I'd like to ignore the unrelated issues with Wikipedia funding here, since it's not relevant to this particular point.) https://en.wikipedia.org/wiki/Wikipedia:Funding_Wikipedia_through_advertisements https://en.wikipedia.org/wiki/Wikipedia:Funding_Wikipedia_th... I don't believe direct sales fixes everything. There's no single party whose ultimate wishes are fully aligned with what's best for everyone. I do think, however, that direct sales and donations are preferable to ads in this regard.
- aimor 4y ago
  I could have been more clear: I don't understand why the non-advertising business's interest is aligned with that of the user. I follow the idea that advertising creates a conflict of interests, but I don't follow that not advertising aligns interests. The business is there to sell a product for the most profit. Making money by selling the product doesn't by itself give them an incentive to produce a better product.
  - therealmocker 4y ago
    > Making money by selling the product doesn't by itself give them an incentive to produce a better product. Selling more product / continued subscriptions is the incentive.
  - jchw 4y ago
    I don't entirely follow, though; the idea is that you want the people who pay you to be satisfied with what they're paying for so that they continue to do so, convince others to do so, and are willing to increase their spending. If that wasn't the case, there wouldn't be a conflict of interest for advertisers in the first place. There's reasons that the incentive to keep the users satisfied may not be followed, but it's mostly tangential, and relates more to other forces than it does where the money comes from.
  - thewebcount 4y ago
    If they don't make the website provide value to me, I will stop paying them. If things are popping up that are irrelevant to my search, that's not helping me. If it's not helping me, I stop paying, and they feel a hit. It's probably not a big deal if a single person does it, but if enough people do it, then they either change to get those people back (or replace them with new customers), or they go out of business.
vorpalhex 4y ago
Doing things requires hardware, which uses electricity and needs software which costs man hours.
shafyy 4y ago
> I don't understand why funding through direct sales will give a better product than funding through advertising The more the economic incentives of a business are aligned with the customer's interest, the better. Of course, it's not perfect, and business still might have an incentive to show ads on top of charging you, but it's certainly much better than having hugely misaligned incentives as with Google and social media today. > Why does everything in the future-web have a price tag attached? Because it uses real resources like humans and hardware that cost real money in the real world. You don't ask why you need to pay money to buy an apple at the grocery store, do you?
- candiodari 4y ago
  I hate this argument. It is economic dogma ... and it's bullshit. Why? Bread in Jerusalem: the law of demand and supply doesn't exist for the vast majority of goods. Jerusalem is a city like any other. Everybody has food. You can buy bread there. And while the city has big problems, not many people are starving (not quite zero, but which city can say that). Economic theory dictates that bread would follow the law of supply and demand. Is that so? Let's say the price of bread halves. Will tomorrow see more bread sales in Jerusalem? Here's the critical piece of evidence: NO, it won't. It won't even shift from one kind to a fancier kind of bread. Let's say the price doubles. Same thing. We're in a ZERO price elasticity regime. Sure there are prices where supply and demand would work, but we're far away from those prices. But it gets worse. Let's look at supply. Bread is incredibly cheap to make. There is at least a 80% or so margin on bread (it's quite expensive, or profitable on the other side, if you look at it from a COGS perspective). Let's say the price of bread doubles (you could argue it has, many times even). Will more bread be produced in Jerusalem? NO. Again there are prices where we'd see supply tightly tied to prices, but we're very far away from those prices. BOTH on the supply and demand side we see ZERO price elasticity. If you look up in your economics book you will not find this situation, and even in academia people aren't exactly comfortable discussing it. Price elasticity is ZERO for bread, both on the demand and the supply side, if you belong to the economists that at least split that up. So what makes the difference? You can make a good living selling bread, but you can't attract customers using prices ... nor can you change your profits much by playing with prices (in fact the very act of trying out prices will lose you a lot of customers). So something else needs to make a difference. What determines which bread you buy? Google does (and Facebook, and ...) And this applies not just to bread. This applies to the vast majority of foods. One of the big complaints in European countries these days is that entire economies are running headfirst into this problem. Even labour! People can't change jobs (supply of labor is regulated by employer demands, or outright regulated with laws) and employers can't change the pool of labor by much by raising wages. Unless you're exceptional or outside of the norm (yes, programmers are, so this is the wrong forum to make that particular argument), you cannot change your income much by providing more labor! Given "no skills" labor even the difference between working and not working ... is not very large and dropping. This, obviously, enables FANG companies to extract the profits of normal businesses. They can choose who gets the profits of many products, and demand a growing share of the profits ...
thethirdone 4y ago
If you want less middlemen on the web, you are probably not in favor of advertising. Price tags only involve a middle man of the payment processor. Advertisement involves ALL of the advertisers on the platform.
Ar-Curunir 4y ago
Do you think that running servers, writing code, maintaining systems happens for free? How else is the service supposed to fund itself?

by aimor 4y ago

jchw 4y ago

I hate to seem condescending, but the "why" is basically what the essay is about for the first 75%. The issue that advertisements have is that the incentives and desires of advertisers usually misaligns with users, sometimes greatly. It's not a concept that's particularly new; for example, take Wikipedia's reasoning for not accepting advertisements. (I'd like to ignore the unrelated issues with Wikipedia funding here, since it's not relevant to this particular point.) https://en.wikipedia.org/wiki/Wikipedia:Funding_Wikipedia_through_advertisements https://en.wikipedia.org/wiki/Wikipedia:Funding_Wikipedia_th... I don't believe direct sales fixes everything. There's no single party whose ultimate wishes are fully aligned with what's best for everyone. I do think, however, that direct sales and donations are preferable to ads in this regard.

aimor 4y ago
I could have been more clear: I don't understand why the non-advertising business's interest is aligned with that of the user. I follow the idea that advertising creates a conflict of interests, but I don't follow that not advertising aligns interests. The business is there to sell a product for the most profit. Making money by selling the product doesn't by itself give them an incentive to produce a better product.
- therealmocker 4y ago
  > Making money by selling the product doesn't by itself give them an incentive to produce a better product. Selling more product / continued subscriptions is the incentive.
- jchw 4y ago
  I don't entirely follow, though; the idea is that you want the people who pay you to be satisfied with what they're paying for so that they continue to do so, convince others to do so, and are willing to increase their spending. If that wasn't the case, there wouldn't be a conflict of interest for advertisers in the first place. There's reasons that the incentive to keep the users satisfied may not be followed, but it's mostly tangential, and relates more to other forces than it does where the money comes from.
- thewebcount 4y ago
  If they don't make the website provide value to me, I will stop paying them. If things are popping up that are irrelevant to my search, that's not helping me. If it's not helping me, I stop paying, and they feel a hit. It's probably not a big deal if a single person does it, but if enough people do it, then they either change to get those people back (or replace them with new customers), or they go out of business.

vorpalhex 4y ago

Doing things requires hardware, which uses electricity and needs software which costs man hours.

shafyy 4y ago

> I don't understand why funding through direct sales will give a better product than funding through advertising The more the economic incentives of a business are aligned with the customer's interest, the better. Of course, it's not perfect, and business still might have an incentive to show ads on top of charging you, but it's certainly much better than having hugely misaligned incentives as with Google and social media today. > Why does everything in the future-web have a price tag attached? Because it uses real resources like humans and hardware that cost real money in the real world. You don't ask why you need to pay money to buy an apple at the grocery store, do you?

candiodari 4y ago
I hate this argument. It is economic dogma ... and it's bullshit. Why? Bread in Jerusalem: the law of demand and supply doesn't exist for the vast majority of goods. Jerusalem is a city like any other. Everybody has food. You can buy bread there. And while the city has big problems, not many people are starving (not quite zero, but which city can say that). Economic theory dictates that bread would follow the law of supply and demand. Is that so? Let's say the price of bread halves. Will tomorrow see more bread sales in Jerusalem? Here's the critical piece of evidence: NO, it won't. It won't even shift from one kind to a fancier kind of bread. Let's say the price doubles. Same thing. We're in a ZERO price elasticity regime. Sure there are prices where supply and demand would work, but we're far away from those prices. But it gets worse. Let's look at supply. Bread is incredibly cheap to make. There is at least a 80% or so margin on bread (it's quite expensive, or profitable on the other side, if you look at it from a COGS perspective). Let's say the price of bread doubles (you could argue it has, many times even). Will more bread be produced in Jerusalem? NO. Again there are prices where we'd see supply tightly tied to prices, but we're very far away from those prices. BOTH on the supply and demand side we see ZERO price elasticity. If you look up in your economics book you will not find this situation, and even in academia people aren't exactly comfortable discussing it. Price elasticity is ZERO for bread, both on the demand and the supply side, if you belong to the economists that at least split that up. So what makes the difference? You can make a good living selling bread, but you can't attract customers using prices ... nor can you change your profits much by playing with prices (in fact the very act of trying out prices will lose you a lot of customers). So something else needs to make a difference. What determines which bread you buy? Google does (and Facebook, and ...) And this applies not just to bread. This applies to the vast majority of foods. One of the big complaints in European countries these days is that entire economies are running headfirst into this problem. Even labour! People can't change jobs (supply of labor is regulated by employer demands, or outright regulated with laws) and employers can't change the pool of labor by much by raising wages. Unless you're exceptional or outside of the norm (yes, programmers are, so this is the wrong forum to make that particular argument), you cannot change your income much by providing more labor! Given "no skills" labor even the difference between working and not working ... is not very large and dropping. This, obviously, enables FANG companies to extract the profits of normal businesses. They can choose who gets the profits of many products, and demand a growing share of the profits ...

thethirdone 4y ago

If you want less middlemen on the web, you are probably not in favor of advertising. Price tags only involve a middle man of the payment processor. Advertisement involves ALL of the advertisers on the platform.

Ar-Curunir 4y ago

Do you think that running servers, writing code, maintaining systems happens for free? How else is the service supposed to fund itself?