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Too big to live, too loved to die: Big Tech's billion dollar curse of the free

213 points by redbell 4y ago

paulpauper 4y ago
If you're making $10 billion/quarter or year, products like Gmail are just loss leaders.
- eternityforest 4y ago
  They're probably data collection projects, which is why the GDPR scares me just a bit. I could easily see myself having to pay $30 a month or more for all the services that are probably funded by spying on me, if they had to use a different business model. It's fairly bad and unsustainable to build a business around trying to get people to argue more online, so they look at your ads to buy absolute crap they don't even want, but I'm not sure what the web would look like without it. Would we still have all the random things like Google Street View that nobody would actually pay enough for as a discrete product? Reputable news sources seem to have already changed from ads to paywalls, presumably because ads were making the sites look too much like tabloids.
  - killingtime74 4y ago
    Fast mail is $3 a month, Protonmail $3.33. so maybe not $30 total
    - eternityforest 4y ago
      The bigger mail companies seem to be slightly pricier. Plus there's Assistant, Calendar, Tile tracking(Already a few bucks a month for proactive reminders), Keep, YoLink's cloud, WiFi Camera clouds, etc. Some of it could be done P2P(Especially Google Assistant which only has about 5 features people use), some things would probably disappear entirely in a privacy first world, and I'm guessing the rest would be an extra $10-$30 or so to.
  - goalieca 4y ago
    > I could easily see myself having to pay $30 a month or more for all the services that are probably funded by spying on me, if they had to use a different business model. I think this is the problem with big tech right now. We all know an email service doesn’t cost 30/month and generate hundred billion dollar companies with $300k programmer salaries. But adtech makes it so.
  - bushbaba 4y ago
    My view is that paywalls were to combat scrapers in a legally defensible way.
  - Lutger 4y ago
    I don't think GDPR will prevent you from entering a contract where you sell your personal info and get paid in free access to services. It just prevents companies from doing so without your consent. Google and other could just provide ad-supported plans along with paid plans. The only goal of GDPR is to stop the theft of personal information, it doesn't dictate a business model.
    - anshumankmr 4y ago
      In a roundabout way you are saying the same thing as the person you replied to. Not enough people are going to opt for that making ad supported plans unviable for a company that is expected to have round the clock all year long growth.
    - mrep 4y ago
      I've seen conflicting opinions on this. Some people claim that is illegal but der spiegel gives me the option of free + personalized ads or paying + ad free but I'm also in the US so it may be different for people in germany.
    - eternityforest 4y ago
      GDPR itself is mostly good although it goes too far in a lot of places. I'm all for full disclosure of what they collect, and for data portability, but I'm not a fan of right to deletion, or technical requirements on how you handle even trivial data. Plus, the GDPR doesn't allow tracking as a precondition for using the service. Which is needed for the law to mean anything at all, otherwise all the big companies would require it and you'd be disadvantaged if you refuse, but it does change the business model. It seems like an unsolvable problem, short of some kind of government funded subsidized open source equivalent of Google or something. The real trouble is from even stronger laws than the GDPR that many individuals want. I'm not exactly sure what the wording of those imaginary laws would be, but a huge number of people did not want Amazon Sidewalk to happen, especially as opt-out, many want tile/AirTag to stop, some people want CCTV to be totally gone, etc.
aezart 4y ago
The death of Gmail would make a whole lot of companies realize they should stop tying account identity to an email address (rather than something like a username), which would be nice.
- vv_ 4y ago
  Most services like to spam users mailboxes with promotions and marketing material for their company, in addition, handling lost password requests would be quite a bother without the requirement that a user ties an e-mail address to an account.
- deleted 4y ago
  [deleted]
- bgro 4y ago
  They’d probably either jump straight to requiring a phone number or ssn and try to write it off as “there’s no other way to verify you’re a real person.” We seem to be going this way already.
  - hyperbovine 4y ago
    SSN would be illegal (in California at least) and phone number comes with the exact same set of problems. Despite all the carping about using email as login, I’ve never seen a better solution offered.
    - Lutger 4y ago
      I agree. Honestly I think this should be a government provided service, not a corporate one.
- Gigachad 4y ago
  No one wants to have to remember a million usernames. At least your email is ensured to be available for use on every site you sign up on so it’s only one thing to remember.
GianFabien 4y ago
I am steadily migrating my critical email IDs off Gmail. I'd rather not have Google gather meta-data about my activities.
- hanklazard 4y ago
  I’m with you but if all my friends and colleagues still use it, Google continues to have a whole lot of my info, eh?
  - neilv 4y ago
    Years ago, a dear friend who used to run his own servers, and was even on the board of one of those Internet public interest nonprofits... gave up and moved his email to GMail. Now, I'm still self-hosting, but most of my private email is nevertheless being archived and farmed by a company, because almost everyone I talk with is using them. Sigh.
    - philjohn 4y ago
      Email has never been "private" per se, it's unencrypted as it flies across the internet. If you want privacy, you need to add a layer of encryption on top.
      - sokoloff 4y ago
        It’s mostly encrypted in transit (on the wire) now. For such mail, each mail transfer agent can still read it, but network devices cannot.
  - benhurmarcel 4y ago
    Most of my non-professional emails are notifications from services, like purchases or whatever. Personal communication is almost 100% in chat apps nowadays. I suspect it's the case for most people. So no, in that case it's not a whole lot of info.
- spaceman_2020 4y ago
isawczuk 4y ago
Gmail is whole ecosystem of apps, transforming your boring inbox to productivity powerhouse. Asking each app to pay (similar to Google maps API key), would be enough to cover costs of infrastructure. Alexa, is perfect spy, to match TV Ads ID with your reactions. They're not monetizing those options because it's too early. It's seems that they can still grow, without looking at red lines.
- TheCowboy 4y ago
  Recent news suggests it's not for lack of trying that Alexa hasn't been monetized, and Amazon has started cutting staff as a result of the failure. People just want to buy the smart assistant, not a voice nag that tries to get them to buy more things without using their eyes. So selling devices at cost hasn't been working.
  - TedDoesntTalk 4y ago
    So increase the price for new devices? Start charging a minimal subscription fee for new devices for more than 3 interactions per day?
    - taormina 4y ago
      They could just make less crappy devices. We love the concept and hate the implementation.
      - TedDoesntTalk 4y ago
        That won’t monetize it, though.
        taormina 4y ago
        How could we know? They haven’t tried yet.
        4y ago
at_a_remove 4y ago
Forget Gmail, it's a distraction at best. I have said this many times: the Internet, as it bloomed starting around 1990 or so, was built on someone else's hardware. Usenet, sure. If you were on IRC at the time, chances are your IRC servers were .edu servers. At first the "someone else's hardware" (SEH) was largely from universities, who often had no real top-down policies about how their bandwidth and such were used. Many SPARCs were pressed into service. Roughly a quarter of a second after the invention of the <img> tag, advertising began to be a thing. Anyone remember NetZero? The banner era began, then animated .GIFs were added, and finally the CPU-crushing Flash banner evolved. Take a moment to remember NetZero, as well as the free hours on AOL discs so numerous the US postal service shuddered. About a thousand people invented AJAX as soon as they realized the implications of the XMLHttpRequest object. Just as the <img> tag was the four-color print for advertising, so this began an era where, with the addition of cookies, you could get more information about how your ads were received, how your viewer moved across domains, and so on. This in turn means you can ask for more money for advertising, after all you can target and track! Before it was merely exposure. Ah, but how to know more? Well, for one, you could have the users host all of their content on your servers. First email, then photos, then video. Why not? And it's all for free. We just need to perform sophisticated analysis on your content, then decide to show you this Viagra ad anyway. This more or less ends at Cloud Computing. I submit that the various frees and SEHs have created radical distortions in the mindset of generations when it comes to "Who pays for this, anyway?" It's certainly devalued some kinds of labor, overvalued others, and probably has some knock-on effects that we might not even immediately notice. I think the need for Cloudflare and other anti-DDoS products stems from the overly casual egress filtering of various ISPs. It's all just free stuff, anyway, let someone else pay for it. Email is "free," and we've largely dealt with spam by building some great machinery (eventually) and hiding it away from everyone, but its big brother, Internet Scam Sam, continues to slither along. We now build to scale and simply make tech support some forum where the users attempt to solve each other's problems -- they're not even interns. I could go on and on, but my key point is that thirty-plus years of "free" has translated to "someone else's problem" and I wonder if we aren't starting to see some bills come due at last.
- kevin_thibedeau 4y ago
kar5pt 4y ago
Does anyone have recommendations to get off of Gmail? I've tried in the past, but I get so much junk mail that not having gmail's auto-categorizing makes my email unusable.
- TedDoesntTalk 4y ago
  This topic is discussed regularly on HN. Popular alternatives are Fastmail and protonmail (surprisingly not Outlook). I use Fastmail. I won’t touch protonmail. Their claims about privacy and encryption are mostly false and if they deceive about that, what else are they deceiving about? Fastmail has been around for ages, much longer than protonmail, even longer than Gmail, and is completely no-nonsense. Good apps and a good web interface. Also: “Fastmail developers are among active contributors to the widely used Cyrus IMAP open source software project and include the lead developer and maintainer of Perl module Mail::IMAPTalk. Fastmail supported the development of the free software webmail interface Roundcube and developed JMAP – a new open email protocol.” https://en.m.wikipedia.org/wiki/Fastmail https://en.m.wikipedia.org/wiki/Fastmail
  - dhruvrrp 4y ago
    But fastmail is based in Australia, which means they can't be trusted for privacy/encryption following the The Assistance and Access Act/Anti-Encryption act. https://www.homeaffairs.gov.au/about-us/our-portfolios/national-security/lawful-access-telecommunications/data-encryption https://www.homeaffairs.gov.au/about-us/our-portfolios/natio...
    - pembrook 4y ago
      Encrypted email just isn’t a thing. The minute you send a message to someone else it’s out in the wild.
      - TedDoesntTalk 4y ago
        This. Get over it. Your email is not private or anonymous and never will be. Once you accept that, ProtonMail's value proposition is meaningless. ProtonMail must answer to subpoenas by handing over stored emails and IP addresses, just like everyone else. Here's one example: https://techcrunch.com/2021/09/06/protonmail-logged-ip-address-of-french-activist-after-order-by-swiss-authorities https://techcrunch.com/2021/09/06/protonmail-logged-ip-addre...
frozenport 4y ago
Lol what? Both companies are raking in money. As the article points out, Google uses gmail to sell more profitable business products. Alphabet Inc made $75 billion profit, so if it costs them $5 per user to run, it will be about a $10 billion cost. Which is a fraction of their profit - and makes for great advertising.
chaostheory 4y ago
I view voice assistants as Silicon Valley’s version of the $5 Costco Rotisserie chicken or $2 Costco hotdog. I am more willing to pay for Amazon Prime and its music service is more useful to me. I also enjoy Fire TV cube because it is voice controlled. I can say the same for voice controls on Google TV and Apple TV, especially for Android Car and Apple Car Play. It’s a loss leader that makes sense just like discounted soda that you place in the back of a supermarket, so you can force your customers to check out your other deals
- thinking4real 4y ago
  [flagged]
  - 12907835202 4y ago
    He compared it to a $5 chicken not a "premium" product.
    - boppo1 4y ago
      Meat will probably be considered a premium product sometime this decade. I hope not, but that's the way it's looking.
      - nibbleshifter 4y ago
        In many places meat worth eating already is a premium product.
  - pydry 4y ago
    They are loss leaders. Whether they are effective is another matter.
- 8n4vidtmkvmk 4y ago
  google home happily plays Spotify tho. it doesn't work any better or worse with YouTube music. is it really bringing additional revenue to their other services?
TedDoesntTalk 4y ago
> There may be no good exit strategy for Google Just start charging for gmail. Problem fixed.
ripvanwinkle 4y ago
Gmail isn't completely free. If you cross about 15GB of total storage across drive, photos, gmail and anything else ( youtube is exempt) you start paying. Now, while the cost to provision a GB of storage keeps dropping Google's prices haven't been revised down ever (from what I can remember). I pay for Google storage and know of a several others who do the same. I suspect the number of paying users is growing
- Ayesh 4y ago
  Yeah I recently started to pay for it too, after using many 12+ years with free storage. It was relatively low cost compared to Dropbox (etc), so it was a natural move. No more stressing over about deleting photos from Google Photos, and I configured that extra space to use as a backup endpoint too (using Duplicati with Google Drive). Probably one of the best value online services I paid for.
  - htag 4y ago
    I recently reached a critical mass on my Google storage (95%+ full), and almost all of it was gmail, with less than 1.5gb for drive/photo. I decided to delete 5gb+ of emails instead of paying. I already had all of my file storage/backup needs taken care of, and I had plenty of emails that were providing me no additional value.
- chaostheory 4y ago
  Photos, just like Gmail, is also a loss leader that drives people to eventually pay Google for storage or for physical photo books.
quicklime 4y ago
> There may be no good exit strategy for Google There is an easy exit strategy for Google (and Amazon), and Google has already done it for Gmail: put a reasonable cap on how much users are allowed to use (storage for Gmail, # of queries for Alexa) and charge for anything on top of that. As server-side hardware costs decrease, wait for that "billion dollar curse" to asymptotically approach zero over the course of a few years.
- JamesAdir 4y ago
  Exactly. Google has slowly but steady cuts the cap on the service. They've started with Google Photos which (I guess) is the 2nd most used personal service for Android users after Gmail, and they will continue to do so by putting more and more limits on storage, so it wouldn't be directly paying for Gmail but paying in general.
  - Gigachad 4y ago
    A lot of the time you don’t even notice the limits. They started counting google docs to your storage limit when previously it was uncounted. But unless you are abusing the service as a file storage, it’s still effectively unlimited. There’s probably a 1% of users who use more than the other 99% added up and quotas cut down on that.
    - rippercushions 4y ago
      If you use Google Photos for backup, you'll hit the free caps pretty quickly.
      - llampx 4y ago
        Exactly. Some members of my family have run into this in 2022, after I recommended Google Photos as an automatic backup for their phone a few years ago. They don't get Gmail when storage is full, something I thought would never happen with Gmail.
      - ghaff 4y ago
vishnugupta 4y ago
If I have a bunch of Alexa enabled devices I'd be really wary. Amazon usually does a decent job of continuing support. But by their own admission they have written off $10B and followed by massive layoffs predominantly in Alexa divisions. Alexa infrastructure is massive and it'll be now put on life support. Mind you that even on life support the infrastructure is incurring massive costs with zero $$ revenue. Perhaps only critical security updates will be rolled out. So expect things to break around the edges, at first. Maybe Amazon will rollout Alexa specific subscription? Otherwise I just don't see how to justify the running costs.
- thewebcount 4y ago
  But it’s not zero revenue. If you’re asking Alexa to play something on Amazon’s music app, they’re getting revenue from your music subscription. They just need to understand where the revenue is coming from and allocate it accordingly. For setting a timer, yeah, there’s no revenue, but people are also unlikely to pay for it, so maybe they could cut out that functionality.
  - groffee 4y ago
    Pretty much the only thing I use my Alexas for is timers (for cooking) and the weather. You're right that I wouldn't pay for just that functionality directly, but I pay for Prime, and spend a fair chunk on AWS every month. And if amazon abandons Alexa then I'll just move everything to another ecosystem.
    - htag 4y ago
      > if amazon abandons Alexa then I'll just move everything to another ecosystem. Why? I'm not an Alexa user, but I am a Prime and AWS user. I don't understand how having a voice interface for weather reports impacts your decision for cloud computing or package delivery. Additionally, what other ecosystem would you move to? Google or Microsoft because they offer both voice interfaces and cloud computing? Why does that impact Prime? I really don't see how these three things are linked in your mind. I could see some link if you used AWS to provide custom Alexa services, or used Alexa to play Prime content (music, audio books) but you specifically said you don't use Alexa for anything other than two really generic use cases.
Aeolun 4y ago
I mean, if they want me to run the Alexa infra on my own systems so I don't have to send anything to Amazon they're very welcome to it. But I'm guessing they want that sweet juicy data.
sacnoradhq 4y ago
What a dumb and ignorant article. "Can't be monetized": news shouldn't be monetized, and neither should personal assistants that tie together personal data and control of vital home systems. VAs are an operating system for all of the other products and services. You give away the printer or the razor handle, and charge for ink and razor blades. You give away the personal assistant, and charge for voices, ringtones, music, movies, groceries, apps, alarms, security features, and so on. If you're spending billions upon billions running a VA that's stagnant and not very good, then you suck as a CIO/CTO and shouldn't be trusted with that sort of budget.
stubish 4y ago
GMail can't go anywhere because of Android. It would need to be replaced with something nearly as comprehensive, tying accounts to 1+ phones and other devices, and authentication and recovery processes. Worst case would be switching to tiny quotas and/or message expiration.
- yokoprime 4y ago
  They could do as Apple with iCloud, where your iCloud login can be any email account.
  - ushakov 4y ago
    Your Google account can be tied to any e-mail account already
    - pmontra 4y ago
      I prefer to separate my Google account from my real email. I've got a gmail before Android because it was free but I never used it. Basically I squatted myself. It's only a spam black hole now. If anything happens to my Google account it has no effect to my business. I might get locked out of the Play store if I won't be able to register another account with the same phone number. The worst it happens is that I have to get a new number which actually is a lot of work (banks, etc.) Does that happen? Anyway, the less I use my account the less problems I should have, so no Gmail.
    - stubish 4y ago
      'any e-mail' account means GMail, Apple or Microsoft for the vast bulk of email addresses. Most of the rest people using their work or school email (many of which backed by Google or Microsoft). Personal domains and other providers are a relative blip.
  - stubish 4y ago
    Apple needs to provide email to users for the same reasons. They are nice enough to let people who already have a working email setup keep using it, but I suspect the bulk of iPhone users will be using their Apple mail.
Havoc 4y ago
I was expecting this article to head for GCP always free tier not gmail. I guess both are expensive promises that can’t be taken back
college_physics 4y ago
The importance of individual data points (the viability of specific products etc) is debatable. What is not debatable, and quite astonishing if you take a step back, is that the majority of tech infrastructure of the recent era, and a major part of total "value creation" as per public markets is based on a random agglomeration of business models. Some of them positively despised and progressively hemmed in by regulation, others unviable on a standalone basis etc. Its not clear if the way the mess will resolve is reverting back to true "big tech" where we pay for tech (as opposed to big adtech or big ecommerce providing tech as a sideshow) or is some other pattern will emerge. The astonishing amount of freebies points on the one hand on the increasingly low cost of tech, on the other hand on the enormous commercial benefit of extracting value from user behavior. What will be the new equilibrium and will it in any sense feel "right" and sustainable? Its a trillion dollar question.
- 8n4vidtmkvmk 4y ago
  Google and Amazon could just charge subscriptions. paying for email might be a hard pill to swallow, but paying for youtube ad free, drive, docs, photos and everything else.. sounds reasonable. Amazon already has prime. just require it for alexa. i don't know how they can add those fees now but it would have been reasonable if they just started that way instead of crossing their fingers Hoping they'd find a way to monetize in the future
  - SkipperCat 4y ago
    I’d pay $12/year for gmail. That would give Google the revenue they need to keep everything humming along. I’ve been living with free e-mail for almost 25+ years now, but a dollar a month would be easy to rationalize for the service.
    - lelanthran 4y ago
      I won't, unless I'm the customer, and get to speak to a human when my email is down. Right now I'm the product and so I have no expectation of customer service. When I'm paying 1 dollar a month I'm holding someone liable if I lose access to my account. And, legally, I can reasonably take Gmail to court for monetary loss and f I am a paying customer. 200k people going to small claims court for whatever will completely wipe out any profit that alphabet hopes to make of Gmail. So, yeah, it's cheaper for Gmail to provide free accounts with no liability than to get caught up in mandatory customer protection laws.
webmobdev 4y ago
> We do not scan or read your Gmail messages to show you ads. That's laughable - When Gmail was launched, it advertised that it would show you "relevant" text ads based on your email! That was one of its features in an era of intrusive banner and pop-up ads in many of the free email services available in the past. While the article may have a point about Alexa and Google Cloud, Gmail cannot be clubbed with it as Gmail does have 2 viable business model - advertisements and subscriptions. Moreover, it is a virtual goldmine of personal data for any advertising platform with your banking statements, your online purchases, your work emails, your personal correspondences, your contacts etc. Anybody who believes Google isn't mining this data is living in a fool's paradise. Unless a law explicitly forbids it, with severe penalties, corporations like Google will absolutely use this data to make money - just look at the fines Google faces around the world for violating the privacy of its users.
- knorker 4y ago
  There are laws against lying about it. So if you believe they are scanning your email but saying they're not, then you have a slam dunk case to get rich by suing them. Edit: Hell, Google can't keep a secret anymore without leaking it. If what you're saying were true then any employee working on the pipelines and ad targeting would easily get the evidence themselves, and sue Google. Google pays well, but not as well as winning a lawsuit.
  - webmobdev 4y ago
    And there are loopholes to get around it. A simple example is when other services are automatically enabled in Gmail like "personalisation", "spam detection", "priority inbox" or sorting promotional emails. All of these require scanning emails and harvesting keywords from it, for which you implicitly give permission. All this data also goes into the personal profile that Google creates for you. The ads are then served from your personal profile. So legally Google is not serving ads after "scanning your email". Why do you think you have to agree to separate terms and conditions privacy policies - Google, Gmail, Photo etc.? (This is not unique to Google. Apple also uses similar tactics - every Apple app now tells you that your data will be used for personalised ads. Services within that will have its own data collection policies "to improve service". Every bullshit "privacy" protection needs you to allow even more invasive data collection to "protect" you. And everything is "opt-in" by default (and praise the lord if you can find an "opt-out" settings at all).
ShredKazoo 4y ago
Why does Google Cloud lose so much money? It shouldn't be that hard to sell cloud services for more than they cost, right?
- adalacelove 4y ago
  That comes after destroying the competition
  - ShredKazoo 4y ago
    Hm, maybe best to use a different provider then
- goodoldneon 4y ago
  The article says that Gmail is reported as part of Google Cloud and Gmail is supposedly a massive money loser
- knorker 4y ago
  Costs money to build new DCs and lay undersea cables for next year's customers when you're consistently growing at 40% year on year. My prediction is when they stop growing exponentially the investments will instead become huge profits.
knorker 4y ago
Uh, google cloud is growing like 40% year on year, and its losses are not. You could call those losses investment, and compare it to how Amazon took over the world (pre AWS) without making a profit. Consistently growing 40% year on year is expensive. It doesn't mean it's not doing great. It's not losses, it's investments for continuing the exponential growth in revenue. When that investment is not needed because market saturation, this can quickly flip to billions in profit.
- scarface74 4y ago
  Growing 40% a year and losing money by charging less than it costs to run is not a sustainable business model.
  - knorker 4y ago
    We don't know if they're charging less than it costs to run. They probably simply have to make investments this year in order to acquire revenue next year. Or at the very least it's a large factor. They could choose to not grow, and instead realize it as profit, but it's not a long term good move. It's probably a good idea to spend $4B (made up number) this year in order to be able to grow revenues next year by $11B. (some simplified arithmetic based on Q3's $6.868B revenue times 4 for the year) And then next year $5.6B to acquire $15B the year after. The nature of exponential growth (anyone who's started a growing company would know this) is that the investment that was expensive this year could easily be paid by the same company next year. Assuming Google can avoid investing the $4B with current customer base, that would take them over a billion into profitable territory. Again, have a look at how Amazon did this the last ~20 years. You can't spin up a DC the same month you find out you need the capacity. It just cannot be done. You need to take into account the time axis. I'm looking forward to the Q4 earnings report. We live in interesting times, though. The USD exchange rate due to the wider economy has significantly affected the earnings of multinational conglomorates as expressed in USD, lately.
lifeisstillgood 4y ago
And ... welcome to the transition from competitive Electricity providers to regulated utility. We will end up seeing something like the "Public Utility Holding Company Act of 1935" but this really was focused on electricity providers that crossed US State lines - and I suspect something something international concerns will mean a conglomerates regulation approach and leave us with about three or four more or less seperate internets with different regulatory regiemes.
s3000 4y ago
>If Google isn’t making any money from you on Gmail Isn't Gmail the core pillar of Google's ad network? Whoever is logged into Gmail tells Google who is using an IP address. Facebook is the other ad network because they can also link requests to ids. Facebook can monetize Instagram because they can sell targeted ads. Likewise, Google can monetize Youtube. If ads can be sold without those ids, Instagram and Youtube could have grown on their won. Is this an emperor's clothing situation and nobody talks about this or do I have a complete misunderstanding of ad technology?
- YetAnotherNick 4y ago
  > Whoever is logged into Gmail tells Google who is using an IP address. Google already has most people's IP address through search. Google is just providing free email because they want control, and I am willing to bet that it would be very hard to make profit, both direct or indirect, through gmail.
  - sokoloff 4y ago
    Without the Google login, Google has a bunch of 32-bit numbers from people’s search activity. With gmail, they now know a lot more about what’s behind those 32-bit numbers.
    - 2OEH8eoCRo0 4y ago
      How many billions does Google pay Apple to be the default search? How about email? Search > email, though I think they're both pillars.
      - adastra22 4y ago
        They don’t have to pay anyone to use Gmail. People prefer gmail and seek it out themselves.
        hericium 4y ago
nailer 4y ago
I would pay 10 dollars a month for a ChatGPT voice assistant but as the owner of a house filled with Alexa devices, i would pay zero as alexa fails too frequently on even basic queries.
mrhektor 4y ago
What are the chances that Google starts charging $2/month (maybe lower in certain markets) for Gmail? I imagine there would be plenty of takers. Maybe not 2 billion takers, but quite a few.
- seydor 4y ago
  They did that with grandafathered Google Apps accounts (custom domain) which remained free until last year. I bet the vast majority of them (like me) switched to the paid version
  - jtc331 4y ago
    There was enough of an outcry that they were forced to implement a way to keep it free if all you used was email (and checked the “noncommercial” box).
    - seydor 4y ago
      really? because all I use is email but i dont recall that option
      - spockz 4y ago
        There used to be large banners and numerous emails warning about this. The deadline has passed now but you can get the “non commercial” flag enabled by going to the help center and asking for it in the chat bot.
        seydor 4y ago
        Right, i guess i missed them or dismissed and forgot about them because i m using it for commercial purposes anyway
    - jtha 4y ago
      Did not know that! You just saved me $5 per month. Happy holidays.
bennysonething 4y ago
I always thought theregister was written by UK staff. The new jersey reference in that article sounds like it's not. Did it change hands?
- nibbleshifter 4y ago
  They have some writers based in the US IIRC, though mostly UK.
concordDance 4y ago
Gmail itself has a negligible cost, when for all those users. Its pocket change for Google and not worth the risk of nationalisation to end of life it.
elzbardico 4y ago
That's the trap with MBA and accountant ways of seeing costs and profit centers: They know the price of everything and the value of nothing. They are the people who laud executives that spin-off businesses like HP getting rid of Agilent, or IBM getting rid of the PC business, or companies cost cutting by closing research centers because they don't really understand how REAL economic value is built in the long run versus financial and accounting shenanigans devised to fool a market composed of short-term obsessed idiot-savants. Gmail may not be very profitable by itself or even a net negative, but it is definitely a centerpiece of google's business. For a sizable portion of humanity, Google is the default provider of their digital identity, something they leveraged even more with Android.
- Alex3917 4y ago
  > it is definitely a centerpiece of google's business. THE centerpiece. The average Google user spends ~5min a day on search, and ~6 hours a day on Gmail.
  - tommek4077 4y ago
    "Of course those numbers are true. I just made them up myself!" .... 6hours is a bit much.
  - jffry 4y ago
    Can you please provide a source for those numbers? Because at first glance they seem pretty fantastical.
    - Alex3917 4y ago
      According to a research report by Adobe, the average office worker spends 5.9 hours per day checking email: https://business.adobe.com/blog/perspectives/if-you-think-email-is-dead-think-again https://business.adobe.com/blog/perspectives/if-you-think-em... Whereas the average Google search supposedly takes 14.6 seconds: https://fitsmallbusiness.com/google-search-statistics/ https://fitsmallbusiness.com/google-search-statistics/
Night_Thastus 4y ago
I'm glad I ended up going with a paid e-mail service. They have to keep improving and maintaining quality of service because if they don't, customers will simply go elsewhere. And I know they won't suddenly disappear as long as they have a solid number of users. If they gathered and sold info, people would immediately leave them as well. All of those make their interests and mine line up, so I don't need to have faith in them to entrust them with my email. As a sidenote: Reminds me of the situation with UberEats and DoorDash, though they're not free services. People like these services. In terms of raw users, they're enormous. DoorDash has something like 25 million users. But they're absolutely burning money. An average of $250 million a year for DoorDash, and sometimes as high as $400 million. But investors keep dumping money into it, because clearly there is enormous demand. And if there's demand, there must be some way to make it profitable. But none of them have noticed that the unit economics don't work. No customer is willing to pay the true price of the food, the delivery and even very minimal overhead. If they charged enough to break even, the demand would completely fall out.
- marcus_holmes 4y ago
  I use a paid email service too. But in the account identity settings I have to give them a backup email address that they can use to verify my identity in case of issues. That backup email address never gets any email, definitely isn't worth paying for, and is obviously a gmail address.
- gruez 4y ago
  >But none of them have noticed that the unit economics don't work. No customer is willing to pay the true price of the food, the delivery and even very minimal overhead. If they charged enough to break even, the demand would completely fall out. I thought food delivery services were profitable on a per unit basis, it was just the marketing/development spend that was causing them to go into the red?
- mattmanser 4y ago
  But we've had paid delivery services for decades before the internet even existed, so it's not that customers don't want to pay. What doesn't seem to work, which is a bit surprising, is centralizing the deliveries to reduce costs. The delivery services should be making their money out of those centralized cost savings, but can't. So instead it's coming out of the food, which means the restaurants rise their prices, etc. My local chippy has four different prices depending on which platform you order it through, which vary by up to 60%! The same item: Deliveroo - £11.99 (centralized search, centralized delivery) Uber Eats - £11.99 (centralized search, centralized delivery) Just Eat - £9.99 (centralized search, restaurant delivers) Preoday - £7.99 (restaurant website, restaurant delivery) Preoday- £7.49 (restaurant website, you collect) Why they can't make money out of the centralization is the real question. I know in the UK they seem to be spending huge amounts on prime-time advertising. Central office headcount could be another reason. Call me cynical but I would also bet a lot of takeaways would avoid a lot of tax on cash orders, which you just can't do when it's all recorded electronically.
EMM_386 4y ago
I still remember when Gmail had the live counter that showed you how much disk space that was being added to your account in "real time" down in the corner back when it first launched. I had to finally cave in last week and pony up to get rid of the "You are using 98% of your storage space!" banner across the top of my Gmail.
roobre 4y ago
Would you have a google account if gmail didn't exist?

213 points by redbell 4y ago

paulpauper 4y ago

If you're making $10 billion/quarter or year, products like Gmail are just loss leaders.

eternityforest 4y ago
They're probably data collection projects, which is why the GDPR scares me just a bit. I could easily see myself having to pay $30 a month or more for all the services that are probably funded by spying on me, if they had to use a different business model. It's fairly bad and unsustainable to build a business around trying to get people to argue more online, so they look at your ads to buy absolute crap they don't even want, but I'm not sure what the web would look like without it. Would we still have all the random things like Google Street View that nobody would actually pay enough for as a discrete product? Reputable news sources seem to have already changed from ads to paywalls, presumably because ads were making the sites look too much like tabloids.
- killingtime74 4y ago
  Fast mail is $3 a month, Protonmail $3.33. so maybe not $30 total
  - eternityforest 4y ago
    The bigger mail companies seem to be slightly pricier. Plus there's Assistant, Calendar, Tile tracking(Already a few bucks a month for proactive reminders), Keep, YoLink's cloud, WiFi Camera clouds, etc. Some of it could be done P2P(Especially Google Assistant which only has about 5 features people use), some things would probably disappear entirely in a privacy first world, and I'm guessing the rest would be an extra $10-$30 or so to.
- goalieca 4y ago
  > I could easily see myself having to pay $30 a month or more for all the services that are probably funded by spying on me, if they had to use a different business model. I think this is the problem with big tech right now. We all know an email service doesn’t cost 30/month and generate hundred billion dollar companies with $300k programmer salaries. But adtech makes it so.
- bushbaba 4y ago
  My view is that paywalls were to combat scrapers in a legally defensible way.
- Lutger 4y ago
  I don't think GDPR will prevent you from entering a contract where you sell your personal info and get paid in free access to services. It just prevents companies from doing so without your consent. Google and other could just provide ad-supported plans along with paid plans. The only goal of GDPR is to stop the theft of personal information, it doesn't dictate a business model.
  - anshumankmr 4y ago
    In a roundabout way you are saying the same thing as the person you replied to. Not enough people are going to opt for that making ad supported plans unviable for a company that is expected to have round the clock all year long growth.
  - mrep 4y ago
    I've seen conflicting opinions on this. Some people claim that is illegal but der spiegel gives me the option of free + personalized ads or paying + ad free but I'm also in the US so it may be different for people in germany.
  - eternityforest 4y ago
    GDPR itself is mostly good although it goes too far in a lot of places. I'm all for full disclosure of what they collect, and for data portability, but I'm not a fan of right to deletion, or technical requirements on how you handle even trivial data. Plus, the GDPR doesn't allow tracking as a precondition for using the service. Which is needed for the law to mean anything at all, otherwise all the big companies would require it and you'd be disadvantaged if you refuse, but it does change the business model. It seems like an unsolvable problem, short of some kind of government funded subsidized open source equivalent of Google or something. The real trouble is from even stronger laws than the GDPR that many individuals want. I'm not exactly sure what the wording of those imaginary laws would be, but a huge number of people did not want Amazon Sidewalk to happen, especially as opt-out, many want tile/AirTag to stop, some people want CCTV to be totally gone, etc.

aezart 4y ago

The death of Gmail would make a whole lot of companies realize they should stop tying account identity to an email address (rather than something like a username), which would be nice.

vv_ 4y ago
Most services like to spam users mailboxes with promotions and marketing material for their company, in addition, handling lost password requests would be quite a bother without the requirement that a user ties an e-mail address to an account.
deleted 4y ago
[deleted]
bgro 4y ago
They’d probably either jump straight to requiring a phone number or ssn and try to write it off as “there’s no other way to verify you’re a real person.” We seem to be going this way already.
- hyperbovine 4y ago
  SSN would be illegal (in California at least) and phone number comes with the exact same set of problems. Despite all the carping about using email as login, I’ve never seen a better solution offered.
  - Lutger 4y ago
    I agree. Honestly I think this should be a government provided service, not a corporate one.
Gigachad 4y ago
No one wants to have to remember a million usernames. At least your email is ensured to be available for use on every site you sign up on so it’s only one thing to remember.

GianFabien 4y ago

I am steadily migrating my critical email IDs off Gmail. I'd rather not have Google gather meta-data about my activities.

hanklazard 4y ago
I’m with you but if all my friends and colleagues still use it, Google continues to have a whole lot of my info, eh?
- neilv 4y ago
  Years ago, a dear friend who used to run his own servers, and was even on the board of one of those Internet public interest nonprofits... gave up and moved his email to GMail. Now, I'm still self-hosting, but most of my private email is nevertheless being archived and farmed by a company, because almost everyone I talk with is using them. Sigh.
  - philjohn 4y ago
    Email has never been "private" per se, it's unencrypted as it flies across the internet. If you want privacy, you need to add a layer of encryption on top.
    - sokoloff 4y ago
      It’s mostly encrypted in transit (on the wire) now. For such mail, each mail transfer agent can still read it, but network devices cannot.
- benhurmarcel 4y ago
  Most of my non-professional emails are notifications from services, like purchases or whatever. Personal communication is almost 100% in chat apps nowadays. I suspect it's the case for most people. So no, in that case it's not a whole lot of info.
spaceman_2020 4y ago

isawczuk 4y ago

Gmail is whole ecosystem of apps, transforming your boring inbox to productivity powerhouse. Asking each app to pay (similar to Google maps API key), would be enough to cover costs of infrastructure. Alexa, is perfect spy, to match TV Ads ID with your reactions. They're not monetizing those options because it's too early. It's seems that they can still grow, without looking at red lines.

TheCowboy 4y ago
Recent news suggests it's not for lack of trying that Alexa hasn't been monetized, and Amazon has started cutting staff as a result of the failure. People just want to buy the smart assistant, not a voice nag that tries to get them to buy more things without using their eyes. So selling devices at cost hasn't been working.
- TedDoesntTalk 4y ago
  So increase the price for new devices? Start charging a minimal subscription fee for new devices for more than 3 interactions per day?
  - taormina 4y ago
    They could just make less crappy devices. We love the concept and hate the implementation.
    - TedDoesntTalk 4y ago
      That won’t monetize it, though.
      - taormina 4y ago
        How could we know? They haven’t tried yet.
        4y ago

at_a_remove 4y ago

Forget Gmail, it's a distraction at best. I have said this many times: the Internet, as it bloomed starting around 1990 or so, was built on someone else's hardware. Usenet, sure. If you were on IRC at the time, chances are your IRC servers were .edu servers. At first the "someone else's hardware" (SEH) was largely from universities, who often had no real top-down policies about how their bandwidth and such were used. Many SPARCs were pressed into service. Roughly a quarter of a second after the invention of the <img> tag, advertising began to be a thing. Anyone remember NetZero? The banner era began, then animated .GIFs were added, and finally the CPU-crushing Flash banner evolved. Take a moment to remember NetZero, as well as the free hours on AOL discs so numerous the US postal service shuddered. About a thousand people invented AJAX as soon as they realized the implications of the XMLHttpRequest object. Just as the <img> tag was the four-color print for advertising, so this began an era where, with the addition of cookies, you could get more information about how your ads were received, how your viewer moved across domains, and so on. This in turn means you can ask for more money for advertising, after all you can target and track! Before it was merely exposure. Ah, but how to know more? Well, for one, you could have the users host all of their content on your servers. First email, then photos, then video. Why not? And it's all for free. We just need to perform sophisticated analysis on your content, then decide to show you this Viagra ad anyway. This more or less ends at Cloud Computing. I submit that the various frees and SEHs have created radical distortions in the mindset of generations when it comes to "Who pays for this, anyway?" It's certainly devalued some kinds of labor, overvalued others, and probably has some knock-on effects that we might not even immediately notice. I think the need for Cloudflare and other anti-DDoS products stems from the overly casual egress filtering of various ISPs. It's all just free stuff, anyway, let someone else pay for it. Email is "free," and we've largely dealt with spam by building some great machinery (eventually) and hiding it away from everyone, but its big brother, Internet Scam Sam, continues to slither along. We now build to scale and simply make tech support some forum where the users attempt to solve each other's problems -- they're not even interns. I could go on and on, but my key point is that thirty-plus years of "free" has translated to "someone else's problem" and I wonder if we aren't starting to see some bills come due at last.

kevin_thibedeau 4y ago

kar5pt 4y ago

Does anyone have recommendations to get off of Gmail? I've tried in the past, but I get so much junk mail that not having gmail's auto-categorizing makes my email unusable.

TedDoesntTalk 4y ago
This topic is discussed regularly on HN. Popular alternatives are Fastmail and protonmail (surprisingly not Outlook). I use Fastmail. I won’t touch protonmail. Their claims about privacy and encryption are mostly false and if they deceive about that, what else are they deceiving about? Fastmail has been around for ages, much longer than protonmail, even longer than Gmail, and is completely no-nonsense. Good apps and a good web interface. Also: “Fastmail developers are among active contributors to the widely used Cyrus IMAP open source software project and include the lead developer and maintainer of Perl module Mail::IMAPTalk. Fastmail supported the development of the free software webmail interface Roundcube and developed JMAP – a new open email protocol.” https://en.m.wikipedia.org/wiki/Fastmail https://en.m.wikipedia.org/wiki/Fastmail
- dhruvrrp 4y ago
  But fastmail is based in Australia, which means they can't be trusted for privacy/encryption following the The Assistance and Access Act/Anti-Encryption act. https://www.homeaffairs.gov.au/about-us/our-portfolios/national-security/lawful-access-telecommunications/data-encryption https://www.homeaffairs.gov.au/about-us/our-portfolios/natio...
  - pembrook 4y ago
    Encrypted email just isn’t a thing. The minute you send a message to someone else it’s out in the wild.
    - TedDoesntTalk 4y ago
      This. Get over it. Your email is not private or anonymous and never will be. Once you accept that, ProtonMail's value proposition is meaningless. ProtonMail must answer to subpoenas by handing over stored emails and IP addresses, just like everyone else. Here's one example: https://techcrunch.com/2021/09/06/protonmail-logged-ip-address-of-french-activist-after-order-by-swiss-authorities https://techcrunch.com/2021/09/06/protonmail-logged-ip-addre...

frozenport 4y ago

Lol what? Both companies are raking in money. As the article points out, Google uses gmail to sell more profitable business products. Alphabet Inc made $75 billion profit, so if it costs them $5 per user to run, it will be about a $10 billion cost. Which is a fraction of their profit - and makes for great advertising.

chaostheory 4y ago

I view voice assistants as Silicon Valley’s version of the $5 Costco Rotisserie chicken or $2 Costco hotdog. I am more willing to pay for Amazon Prime and its music service is more useful to me. I also enjoy Fire TV cube because it is voice controlled. I can say the same for voice controls on Google TV and Apple TV, especially for Android Car and Apple Car Play. It’s a loss leader that makes sense just like discounted soda that you place in the back of a supermarket, so you can force your customers to check out your other deals

thinking4real 4y ago
[flagged]
- 12907835202 4y ago
  He compared it to a $5 chicken not a "premium" product.
  - boppo1 4y ago
    Meat will probably be considered a premium product sometime this decade. I hope not, but that's the way it's looking.
    - nibbleshifter 4y ago
      In many places meat worth eating already is a premium product.
- pydry 4y ago
  They are loss leaders. Whether they are effective is another matter.
8n4vidtmkvmk 4y ago
google home happily plays Spotify tho. it doesn't work any better or worse with YouTube music. is it really bringing additional revenue to their other services?

TedDoesntTalk 4y ago

> There may be no good exit strategy for Google Just start charging for gmail. Problem fixed.

ripvanwinkle 4y ago

Gmail isn't completely free. If you cross about 15GB of total storage across drive, photos, gmail and anything else ( youtube is exempt) you start paying. Now, while the cost to provision a GB of storage keeps dropping Google's prices haven't been revised down ever (from what I can remember). I pay for Google storage and know of a several others who do the same. I suspect the number of paying users is growing

Ayesh 4y ago
Yeah I recently started to pay for it too, after using many 12+ years with free storage. It was relatively low cost compared to Dropbox (etc), so it was a natural move. No more stressing over about deleting photos from Google Photos, and I configured that extra space to use as a backup endpoint too (using Duplicati with Google Drive). Probably one of the best value online services I paid for.
- htag 4y ago
  I recently reached a critical mass on my Google storage (95%+ full), and almost all of it was gmail, with less than 1.5gb for drive/photo. I decided to delete 5gb+ of emails instead of paying. I already had all of my file storage/backup needs taken care of, and I had plenty of emails that were providing me no additional value.
chaostheory 4y ago
Photos, just like Gmail, is also a loss leader that drives people to eventually pay Google for storage or for physical photo books.

quicklime 4y ago

> There may be no good exit strategy for Google There is an easy exit strategy for Google (and Amazon), and Google has already done it for Gmail: put a reasonable cap on how much users are allowed to use (storage for Gmail, # of queries for Alexa) and charge for anything on top of that. As server-side hardware costs decrease, wait for that "billion dollar curse" to asymptotically approach zero over the course of a few years.

JamesAdir 4y ago
Exactly. Google has slowly but steady cuts the cap on the service. They've started with Google Photos which (I guess) is the 2nd most used personal service for Android users after Gmail, and they will continue to do so by putting more and more limits on storage, so it wouldn't be directly paying for Gmail but paying in general.
- Gigachad 4y ago
  A lot of the time you don’t even notice the limits. They started counting google docs to your storage limit when previously it was uncounted. But unless you are abusing the service as a file storage, it’s still effectively unlimited. There’s probably a 1% of users who use more than the other 99% added up and quotas cut down on that.
  - rippercushions 4y ago
    If you use Google Photos for backup, you'll hit the free caps pretty quickly.
    - llampx 4y ago
      Exactly. Some members of my family have run into this in 2022, after I recommended Google Photos as an automatic backup for their phone a few years ago. They don't get Gmail when storage is full, something I thought would never happen with Gmail.
    - ghaff 4y ago

vishnugupta 4y ago

If I have a bunch of Alexa enabled devices I'd be really wary. Amazon usually does a decent job of continuing support. But by their own admission they have written off $10B and followed by massive layoffs predominantly in Alexa divisions. Alexa infrastructure is massive and it'll be now put on life support. Mind you that even on life support the infrastructure is incurring massive costs with zero $$ revenue. Perhaps only critical security updates will be rolled out. So expect things to break around the edges, at first. Maybe Amazon will rollout Alexa specific subscription? Otherwise I just don't see how to justify the running costs.

thewebcount 4y ago
But it’s not zero revenue. If you’re asking Alexa to play something on Amazon’s music app, they’re getting revenue from your music subscription. They just need to understand where the revenue is coming from and allocate it accordingly. For setting a timer, yeah, there’s no revenue, but people are also unlikely to pay for it, so maybe they could cut out that functionality.
- groffee 4y ago
  Pretty much the only thing I use my Alexas for is timers (for cooking) and the weather. You're right that I wouldn't pay for just that functionality directly, but I pay for Prime, and spend a fair chunk on AWS every month. And if amazon abandons Alexa then I'll just move everything to another ecosystem.
  - htag 4y ago
    > if amazon abandons Alexa then I'll just move everything to another ecosystem. Why? I'm not an Alexa user, but I am a Prime and AWS user. I don't understand how having a voice interface for weather reports impacts your decision for cloud computing or package delivery. Additionally, what other ecosystem would you move to? Google or Microsoft because they offer both voice interfaces and cloud computing? Why does that impact Prime? I really don't see how these three things are linked in your mind. I could see some link if you used AWS to provide custom Alexa services, or used Alexa to play Prime content (music, audio books) but you specifically said you don't use Alexa for anything other than two really generic use cases.

Aeolun 4y ago

I mean, if they want me to run the Alexa infra on my own systems so I don't have to send anything to Amazon they're very welcome to it. But I'm guessing they want that sweet juicy data.

sacnoradhq 4y ago

What a dumb and ignorant article. "Can't be monetized": news shouldn't be monetized, and neither should personal assistants that tie together personal data and control of vital home systems. VAs are an operating system for all of the other products and services. You give away the printer or the razor handle, and charge for ink and razor blades. You give away the personal assistant, and charge for voices, ringtones, music, movies, groceries, apps, alarms, security features, and so on. If you're spending billions upon billions running a VA that's stagnant and not very good, then you suck as a CIO/CTO and shouldn't be trusted with that sort of budget.

stubish 4y ago

GMail can't go anywhere because of Android. It would need to be replaced with something nearly as comprehensive, tying accounts to 1+ phones and other devices, and authentication and recovery processes. Worst case would be switching to tiny quotas and/or message expiration.

yokoprime 4y ago
They could do as Apple with iCloud, where your iCloud login can be any email account.
- ushakov 4y ago
  Your Google account can be tied to any e-mail account already
  - pmontra 4y ago
    I prefer to separate my Google account from my real email. I've got a gmail before Android because it was free but I never used it. Basically I squatted myself. It's only a spam black hole now. If anything happens to my Google account it has no effect to my business. I might get locked out of the Play store if I won't be able to register another account with the same phone number. The worst it happens is that I have to get a new number which actually is a lot of work (banks, etc.) Does that happen? Anyway, the less I use my account the less problems I should have, so no Gmail.
  - stubish 4y ago
    'any e-mail' account means GMail, Apple or Microsoft for the vast bulk of email addresses. Most of the rest people using their work or school email (many of which backed by Google or Microsoft). Personal domains and other providers are a relative blip.
- stubish 4y ago
  Apple needs to provide email to users for the same reasons. They are nice enough to let people who already have a working email setup keep using it, but I suspect the bulk of iPhone users will be using their Apple mail.

Havoc 4y ago

I was expecting this article to head for GCP always free tier not gmail. I guess both are expensive promises that can’t be taken back

college_physics 4y ago

The importance of individual data points (the viability of specific products etc) is debatable. What is not debatable, and quite astonishing if you take a step back, is that the majority of tech infrastructure of the recent era, and a major part of total "value creation" as per public markets is based on a random agglomeration of business models. Some of them positively despised and progressively hemmed in by regulation, others unviable on a standalone basis etc. Its not clear if the way the mess will resolve is reverting back to true "big tech" where we pay for tech (as opposed to big adtech or big ecommerce providing tech as a sideshow) or is some other pattern will emerge. The astonishing amount of freebies points on the one hand on the increasingly low cost of tech, on the other hand on the enormous commercial benefit of extracting value from user behavior. What will be the new equilibrium and will it in any sense feel "right" and sustainable? Its a trillion dollar question.

8n4vidtmkvmk 4y ago
Google and Amazon could just charge subscriptions. paying for email might be a hard pill to swallow, but paying for youtube ad free, drive, docs, photos and everything else.. sounds reasonable. Amazon already has prime. just require it for alexa. i don't know how they can add those fees now but it would have been reasonable if they just started that way instead of crossing their fingers Hoping they'd find a way to monetize in the future
- SkipperCat 4y ago
  I’d pay $12/year for gmail. That would give Google the revenue they need to keep everything humming along. I’ve been living with free e-mail for almost 25+ years now, but a dollar a month would be easy to rationalize for the service.
  - lelanthran 4y ago
    I won't, unless I'm the customer, and get to speak to a human when my email is down. Right now I'm the product and so I have no expectation of customer service. When I'm paying 1 dollar a month I'm holding someone liable if I lose access to my account. And, legally, I can reasonably take Gmail to court for monetary loss and f I am a paying customer. 200k people going to small claims court for whatever will completely wipe out any profit that alphabet hopes to make of Gmail. So, yeah, it's cheaper for Gmail to provide free accounts with no liability than to get caught up in mandatory customer protection laws.

webmobdev 4y ago

> We do not scan or read your Gmail messages to show you ads. That's laughable - When Gmail was launched, it advertised that it would show you "relevant" text ads based on your email! That was one of its features in an era of intrusive banner and pop-up ads in many of the free email services available in the past. While the article may have a point about Alexa and Google Cloud, Gmail cannot be clubbed with it as Gmail does have 2 viable business model - advertisements and subscriptions. Moreover, it is a virtual goldmine of personal data for any advertising platform with your banking statements, your online purchases, your work emails, your personal correspondences, your contacts etc. Anybody who believes Google isn't mining this data is living in a fool's paradise. Unless a law explicitly forbids it, with severe penalties, corporations like Google will absolutely use this data to make money - just look at the fines Google faces around the world for violating the privacy of its users.

knorker 4y ago
There are laws against lying about it. So if you believe they are scanning your email but saying they're not, then you have a slam dunk case to get rich by suing them. Edit: Hell, Google can't keep a secret anymore without leaking it. If what you're saying were true then any employee working on the pipelines and ad targeting would easily get the evidence themselves, and sue Google. Google pays well, but not as well as winning a lawsuit.
- webmobdev 4y ago
  And there are loopholes to get around it. A simple example is when other services are automatically enabled in Gmail like "personalisation", "spam detection", "priority inbox" or sorting promotional emails. All of these require scanning emails and harvesting keywords from it, for which you implicitly give permission. All this data also goes into the personal profile that Google creates for you. The ads are then served from your personal profile. So legally Google is not serving ads after "scanning your email". Why do you think you have to agree to separate terms and conditions privacy policies - Google, Gmail, Photo etc.? (This is not unique to Google. Apple also uses similar tactics - every Apple app now tells you that your data will be used for personalised ads. Services within that will have its own data collection policies "to improve service". Every bullshit "privacy" protection needs you to allow even more invasive data collection to "protect" you. And everything is "opt-in" by default (and praise the lord if you can find an "opt-out" settings at all).

ShredKazoo 4y ago

Why does Google Cloud lose so much money? It shouldn't be that hard to sell cloud services for more than they cost, right?

adalacelove 4y ago
That comes after destroying the competition
- ShredKazoo 4y ago
  Hm, maybe best to use a different provider then
goodoldneon 4y ago
The article says that Gmail is reported as part of Google Cloud and Gmail is supposedly a massive money loser
knorker 4y ago
Costs money to build new DCs and lay undersea cables for next year's customers when you're consistently growing at 40% year on year. My prediction is when they stop growing exponentially the investments will instead become huge profits.

knorker 4y ago

Uh, google cloud is growing like 40% year on year, and its losses are not. You could call those losses investment, and compare it to how Amazon took over the world (pre AWS) without making a profit. Consistently growing 40% year on year is expensive. It doesn't mean it's not doing great. It's not losses, it's investments for continuing the exponential growth in revenue. When that investment is not needed because market saturation, this can quickly flip to billions in profit.

scarface74 4y ago
Growing 40% a year and losing money by charging less than it costs to run is not a sustainable business model.
- knorker 4y ago
  We don't know if they're charging less than it costs to run. They probably simply have to make investments this year in order to acquire revenue next year. Or at the very least it's a large factor. They could choose to not grow, and instead realize it as profit, but it's not a long term good move. It's probably a good idea to spend $4B (made up number) this year in order to be able to grow revenues next year by $11B. (some simplified arithmetic based on Q3's $6.868B revenue times 4 for the year) And then next year $5.6B to acquire $15B the year after. The nature of exponential growth (anyone who's started a growing company would know this) is that the investment that was expensive this year could easily be paid by the same company next year. Assuming Google can avoid investing the $4B with current customer base, that would take them over a billion into profitable territory. Again, have a look at how Amazon did this the last ~20 years. You can't spin up a DC the same month you find out you need the capacity. It just cannot be done. You need to take into account the time axis. I'm looking forward to the Q4 earnings report. We live in interesting times, though. The USD exchange rate due to the wider economy has significantly affected the earnings of multinational conglomorates as expressed in USD, lately.

lifeisstillgood 4y ago

And ... welcome to the transition from competitive Electricity providers to regulated utility. We will end up seeing something like the "Public Utility Holding Company Act of 1935" but this really was focused on electricity providers that crossed US State lines - and I suspect something something international concerns will mean a conglomerates regulation approach and leave us with about three or four more or less seperate internets with different regulatory regiemes.

s3000 4y ago

>If Google isn’t making any money from you on Gmail Isn't Gmail the core pillar of Google's ad network? Whoever is logged into Gmail tells Google who is using an IP address. Facebook is the other ad network because they can also link requests to ids. Facebook can monetize Instagram because they can sell targeted ads. Likewise, Google can monetize Youtube. If ads can be sold without those ids, Instagram and Youtube could have grown on their won. Is this an emperor's clothing situation and nobody talks about this or do I have a complete misunderstanding of ad technology?

YetAnotherNick 4y ago
> Whoever is logged into Gmail tells Google who is using an IP address. Google already has most people's IP address through search. Google is just providing free email because they want control, and I am willing to bet that it would be very hard to make profit, both direct or indirect, through gmail.
- sokoloff 4y ago
  Without the Google login, Google has a bunch of 32-bit numbers from people’s search activity. With gmail, they now know a lot more about what’s behind those 32-bit numbers.
  - 2OEH8eoCRo0 4y ago
    How many billions does Google pay Apple to be the default search? How about email? Search > email, though I think they're both pillars.
    - adastra22 4y ago
      They don’t have to pay anyone to use Gmail. People prefer gmail and seek it out themselves.
      - hericium 4y ago

nailer 4y ago

I would pay 10 dollars a month for a ChatGPT voice assistant but as the owner of a house filled with Alexa devices, i would pay zero as alexa fails too frequently on even basic queries.

mrhektor 4y ago

What are the chances that Google starts charging $2/month (maybe lower in certain markets) for Gmail? I imagine there would be plenty of takers. Maybe not 2 billion takers, but quite a few.

seydor 4y ago
They did that with grandafathered Google Apps accounts (custom domain) which remained free until last year. I bet the vast majority of them (like me) switched to the paid version
- jtc331 4y ago
  There was enough of an outcry that they were forced to implement a way to keep it free if all you used was email (and checked the “noncommercial” box).
  - seydor 4y ago
    really? because all I use is email but i dont recall that option
    - spockz 4y ago
      There used to be large banners and numerous emails warning about this. The deadline has passed now but you can get the “non commercial” flag enabled by going to the help center and asking for it in the chat bot.
      - seydor 4y ago
        Right, i guess i missed them or dismissed and forgot about them because i m using it for commercial purposes anyway
  - jtha 4y ago
    Did not know that! You just saved me $5 per month. Happy holidays.

bennysonething 4y ago

I always thought theregister was written by UK staff. The new jersey reference in that article sounds like it's not. Did it change hands?

nibbleshifter 4y ago
They have some writers based in the US IIRC, though mostly UK.

concordDance 4y ago

Gmail itself has a negligible cost, when for all those users. Its pocket change for Google and not worth the risk of nationalisation to end of life it.

elzbardico 4y ago

That's the trap with MBA and accountant ways of seeing costs and profit centers: They know the price of everything and the value of nothing. They are the people who laud executives that spin-off businesses like HP getting rid of Agilent, or IBM getting rid of the PC business, or companies cost cutting by closing research centers because they don't really understand how REAL economic value is built in the long run versus financial and accounting shenanigans devised to fool a market composed of short-term obsessed idiot-savants. Gmail may not be very profitable by itself or even a net negative, but it is definitely a centerpiece of google's business. For a sizable portion of humanity, Google is the default provider of their digital identity, something they leveraged even more with Android.

Alex3917 4y ago
> it is definitely a centerpiece of google's business. THE centerpiece. The average Google user spends ~5min a day on search, and ~6 hours a day on Gmail.
- tommek4077 4y ago
  "Of course those numbers are true. I just made them up myself!" .... 6hours is a bit much.
- jffry 4y ago
  Can you please provide a source for those numbers? Because at first glance they seem pretty fantastical.
  - Alex3917 4y ago
    According to a research report by Adobe, the average office worker spends 5.9 hours per day checking email: https://business.adobe.com/blog/perspectives/if-you-think-email-is-dead-think-again https://business.adobe.com/blog/perspectives/if-you-think-em... Whereas the average Google search supposedly takes 14.6 seconds: https://fitsmallbusiness.com/google-search-statistics/ https://fitsmallbusiness.com/google-search-statistics/

Night_Thastus 4y ago

I'm glad I ended up going with a paid e-mail service. They have to keep improving and maintaining quality of service because if they don't, customers will simply go elsewhere. And I know they won't suddenly disappear as long as they have a solid number of users. If they gathered and sold info, people would immediately leave them as well. All of those make their interests and mine line up, so I don't need to have faith in them to entrust them with my email. As a sidenote: Reminds me of the situation with UberEats and DoorDash, though they're not free services. People like these services. In terms of raw users, they're enormous. DoorDash has something like 25 million users. But they're absolutely burning money. An average of $250 million a year for DoorDash, and sometimes as high as $400 million. But investors keep dumping money into it, because clearly there is enormous demand. And if there's demand, there must be some way to make it profitable. But none of them have noticed that the unit economics don't work. No customer is willing to pay the true price of the food, the delivery and even very minimal overhead. If they charged enough to break even, the demand would completely fall out.

marcus_holmes 4y ago
I use a paid email service too. But in the account identity settings I have to give them a backup email address that they can use to verify my identity in case of issues. That backup email address never gets any email, definitely isn't worth paying for, and is obviously a gmail address.
gruez 4y ago
>But none of them have noticed that the unit economics don't work. No customer is willing to pay the true price of the food, the delivery and even very minimal overhead. If they charged enough to break even, the demand would completely fall out. I thought food delivery services were profitable on a per unit basis, it was just the marketing/development spend that was causing them to go into the red?
mattmanser 4y ago
But we've had paid delivery services for decades before the internet even existed, so it's not that customers don't want to pay. What doesn't seem to work, which is a bit surprising, is centralizing the deliveries to reduce costs. The delivery services should be making their money out of those centralized cost savings, but can't. So instead it's coming out of the food, which means the restaurants rise their prices, etc. My local chippy has four different prices depending on which platform you order it through, which vary by up to 60%! The same item: Deliveroo - £11.99 (centralized search, centralized delivery) Uber Eats - £11.99 (centralized search, centralized delivery) Just Eat - £9.99 (centralized search, restaurant delivers) Preoday - £7.99 (restaurant website, restaurant delivery) Preoday- £7.49 (restaurant website, you collect) Why they can't make money out of the centralization is the real question. I know in the UK they seem to be spending huge amounts on prime-time advertising. Central office headcount could be another reason. Call me cynical but I would also bet a lot of takeaways would avoid a lot of tax on cash orders, which you just can't do when it's all recorded electronically.

EMM_386 4y ago

I still remember when Gmail had the live counter that showed you how much disk space that was being added to your account in "real time" down in the corner back when it first launched. I had to finally cave in last week and pony up to get rid of the "You are using 98% of your storage space!" banner across the top of my Gmail.

roobre 4y ago

Would you have a google account if gmail didn't exist?