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I might be totally misled here but, why would a company need to turn to such practices? Like, I’ve heard about enshitification but, can there be a company that

by _benj 3y ago

I might be totally misled here but, why would a company need to turn to such practices? Like, I’ve heard about enshitification but, can there be a company that provides a service, is profitable, the customer are happy and that is that? No need to swallow the world, destroy the competition, lock in their customer, sell their data? Like, honestly, why? I know about human greed, but is greed so stupid as to destroy itself?

figassis 3y ago
VCs don't invest in a company to make it last forever. They want their 10x return as soon as humanly possible. So they push companies to grow as fast as possible and then exit (ie. sell to the next bag holders). Their strategy is not steady 2x dividends from successful companies, it is multiple companies exploding at different times so they have a steady stream of 10x money bags falling from the sky.
johnnyanmac 3y ago
> can there be a company that provides a service, is profitable, the customer are happy and that is that? Sure, but with every artistic medium except video games you are making very little or even losing money on the medmium itself. The average episode of a TV show costs 1m dollars per episode (and I'm unfortunately being very conservative here. feel free to look up how much your favorite show costs) and it's being offered on a streaming service that people pay $5-15 a month for. BUT it is also offered alongside hundreds of other shows and payout is based on views. Even if you were the only show here, were talking about needing 100k-200k views per episode to be sustainable. But no one is paying $5/episode to begin with. Video games only succeed because they charge these sorts of premiums (or because of various f2p monetiztions, but that's another rabbit hole). People will pay $60-70 per new release. But of course, your average AAA video game is much more expensive to produce as well, so it still has issues. For the scale of presentation desired and the amount of money people are willing to pay, you really can't have a profitable service from the service itself. And unfortunately that mentality is part of why companies are jumping so hard into AI. pay less people, make more content faster. It's a win-win-win if you only care about money and not artistic quality and integrity.

by _benj 3y ago

figassis 3y ago

VCs don't invest in a company to make it last forever. They want their 10x return as soon as humanly possible. So they push companies to grow as fast as possible and then exit (ie. sell to the next bag holders). Their strategy is not steady 2x dividends from successful companies, it is multiple companies exploding at different times so they have a steady stream of 10x money bags falling from the sky.

johnnyanmac 3y ago

> can there be a company that provides a service, is profitable, the customer are happy and that is that? Sure, but with every artistic medium except video games you are making very little or even losing money on the medmium itself. The average episode of a TV show costs 1m dollars per episode (and I'm unfortunately being very conservative here. feel free to look up how much your favorite show costs) and it's being offered on a streaming service that people pay $5-15 a month for. BUT it is also offered alongside hundreds of other shows and payout is based on views. Even if you were the only show here, were talking about needing 100k-200k views per episode to be sustainable. But no one is paying $5/episode to begin with. Video games only succeed because they charge these sorts of premiums (or because of various f2p monetiztions, but that's another rabbit hole). People will pay $60-70 per new release. But of course, your average AAA video game is much more expensive to produce as well, so it still has issues. For the scale of presentation desired and the amount of money people are willing to pay, you really can't have a profitable service from the service itself. And unfortunately that mentality is part of why companies are jumping so hard into AI. pay less people, make more content faster. It's a win-win-win if you only care about money and not artistic quality and integrity.