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Comment by Calvin02 | Hacker News Reader

I foresee tech companies creating paid and non-paid versions of their products. If you don't want your data monetized, please pay $50/month for Google Search, GMail, Maps, and YouTube. If you are okay with the value exchange of ads and free services, then you are opting into a mutually agreed upon arrangement with no compensation.

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This would create a weird paradox:

Advertisers want people with disposable income.

People without much disposable income get really targeted ads (they won’t pay for the privacy).

People with disposable income pay for the privacy service and don’t get ads or get poorly targeted ads.

It then becomes more like traditional ads that get broadcast to everyone.

So the policy shoots itself in the foot.

I think you overestimate how much people with disposable income value internet privacy.

I'm sure Google has good numbers on this from YouTube premium.

Yeah. It s like advertising to poor countries because CPMs are lower there

Podcasts already have premium versions without ads.

Video streaming (and music streaming though not as much anymore) also have premium versions without ads.

I think people are willing to pay for an "ad-free" experience on some services and still see ads elsewhere.

This business strategy has been known to fail time and time again. Once a product is launched with the "Freemium" model, it is very difficult to switch to a subscription model without losing the majority of the customer base.

This article argues that freemium is a marketing tool, not a business model:

https://medium.com/m8-ventures/why-freemium-doesnt-work-so-w...

The M&Ms example is delightfully succinct in explaining why the transition never works.

I cant imagine this type of model existing without a large number of companies continuing to monetize that data regardless of if they charge the user or not. Unless data privacy laws get much better why wouldn't they? Just say sorry when caught and keep on doing it.

This shows why it wouldn't work. What someone may expect to pay is something like $50/month.

In the US, the Fed did a study to figure out how much they would have to pay users to stop using products like Facebook, YouTube, or to stop using search engines altogether.

The median value for Facebook was $48/month, YouTube $1,173/month, and search $17,530/month. [1]

I think many people might pay $50/month to use Google Search, GMail, Maps, and YouTube. But what if they were to pay $18,703/month, just for Google Search and YouTube? Because that's the median price that US users valued these at.

This shows that the advertising model is way better than paid subscriptions, because users are getting much more value out of them (>$18,000/month) than they would realistically pay for them. If all these services were subscription-based and there was no advertising or data collection, almost nobody would pay for them and then the business model wouldn't be scalable so the service wouldn't work. TLDR: The advertising business model is awesome!!

[1]: https://www.cnbc.com/2019/10/11/fed-tries-to-figure-out-valu...

I'm not sure that can work with so many of those services being built on a social graph.

You may not want your data monetized, but if you are in the contacts list of somebody else who has opted in, your half of any conversation isn't going to be excluded.

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