Hacker News Reader

Comment by manquer | Hacker News Reader

That is how it is today. But does it have to be like that ? What is the minimum revenue per user required for service like FB to run.

While everyone is sceptical on whether such a service can reach critical mass to make financial sense, a brand new FB replacement may not be able to do it, However FB itself can certainly give that as an option without hurting their revenues substantially.

I was sceptical on the value prop for Youtube Premium, I am constantly surprised how many people pay for it, if google can afford to loose ad money with YT premium, I am sure FB can build a financial model around a freemium offering if they wanted to.

View on HN

Minimum doesn't matter, the only question is if it's more profitable than the current approach. Facebook makes $9/user/quarter. That's every user no matter how little they use the site.

The issue however is that the users advertisers care about are the ones with disposable income. The users most likely to opt out of ads are the ones with disposable income. Thus the marginal cost to Facebook from such users is significantly more than $9/quarter.

>>> The ultimate problem is that Facebook doesn't want to show you good, enriching content from your friends and family. They want to show you ads. The good content is just a necessary evil to make you tolerate looking at ads.

>> That is how it is today. But does it have to be like that ? What is the minimum revenue per user required for service like FB to run.

> Minimum doesn't matter, the only question is if it's more profitable than the current approach.

Only if you think strictly inside the box.

The real problem here is one is a misalignment of incentives: Zuckerberg is managing Facebook to maximize the metric he's being evaluated on (profit and wealth), not the value provided to society.

Value to society is subjective and many horrors of the past (and current) were caused by trying to optimize specific definitions of that term.

And many horrors of the past and present were and are caused by optimizing for profits. So it's not like we get to side-step horror-avoidance.

I'd start with treating users as partners, and not cattle.

>So it's not like we get to side-step horror-avoidance.

Which is my point. It's easy to say "just force them to optimize for value to society" and then ignore what that really entails in practice. And what giving someone the power to do that tends to cause.

Actually solving the related problems and making things actually better is probably possible but it's messy and hard and complicated.

> It's easy to say "just force them to optimize for value to society" and then ignore what that really entails in practice. And what giving someone the power to do that tends to cause.

> Actually solving the related problems and making things actually better is probably possible but it's messy and hard and complicated.

What you describe is politics, and it's inescapable.

"force them to optimize" doesn't mean putting a gun to somebody's head. But it's clear that the existing socioeconomic arrangements overall incentivize companies, including Facebook, to do a lot of harm while chasing profits. Forcing them to not do so can also mean changing the arrangements to remove the incentives.

> I'd start with treating users as partners, and not cattle.

What does this mean in practice? How do you treat 2.6 billion people as partners?

> I am sure FB can build a financial model around a freemium offering if they wanted to.

They probably could. As they could also charge you a premium and then profit two times on top of you — with your fee and then by selling your data to third parties. Why? Because who would know that was happening? Corporations have no moral compass dictating their actions. The bottom line being what's best for investors.

Google uses my watching data in YouTube premium paying or not. They only claim not to show ads , that’s what most users care about . Even if FB sells / uses the data , as long as you don’t see ads and promoted content there are enough people who will pay for it

20 million for YT @ 5$/month is more than 1 billion in revenue per year. Given that 20M is just 1% of the user base , there is probably not a lot impact on the ad revenue either.

In don’t see Facebook surviving such a transition. Without the manipulation and data mining for engagement you’re just left with a few features that is probably easily subsumed by other services in some federated fashion. It would provably look as exciting as hosted e-mail from the business side.

Only a minority of users would pay for it. <1% of the users going by YT numbers .

It is not either free or paid , it can be both . It satisfies a need for the people willing to pay for the privilege of not seeing ads and gives additional revenue even.

No radical business changes required only a ideological change to treat their users as humans in required from FB

Reply on news.ycombinator.com