Enshittification is basically monetization, so… it’s only going to get worse as they invent new ways of ‘extracting value’.
The whole idea Doctorow was pointing at is that startups could use massive amounts of VC funding to attract a large base of users, often by dumping their services on the market in order to kill competitors (what was once rebranded "blitzscaling" so we wouldn't notice it was at its core an illegal business practice).
Then, once that user base was attached (and ideally stuck due to barriers like network effects or the lack of any viable competitors in the space), you start milking them by "enshittifying" the service.
But if VC money becomes more scarce, that stops working. Companies will have to generate revenue much earlier, and compete on quality of service instead of who can raise the largest VC war chest to subsidize their operations. And they won't be able to wait until that user base is built and attached before they start monetizing. They'll have to create a revenue generating service that's also good to the user because otherwise the users just won't show up.
For the existing services? Yup, you're right, the masks will start to come off (and in many cases already have).
But long-term I would expect a much healthier internet to emerge.
I’m quite happy with the products where you just directly pay them and receive a service. Fastmail monatizes their users and doesn’t have to do it in a shitty way.
Which by and large doesn't work but staves off the inevitable for a while.
A lot of news has been in this boat for a while. More obnoxious patterns trying to get you to subscribe. More ads. While cutting staff to the bone and more. (And that's not even VCs for the most part.)
A lot of things that people want, not enough are willing to actually pay for.
Except in a capitalistic system, owners will not be satisfied with ANY price because the number has to keep going up.
<https://www.theatlantic.com/magazine/archive/2021/11/alden-g...>
<https://www.nytimes.com/2023/07/11/business/media/maine-news...>
I’m the same way, but we’re a strong minority of users. I love that I can simply pay for YouTube Premium and not have ads, but that’s generally not a workable business model for many types of tech companies. In fact, I’m a bit surprised Google hasn’t done away with that yet, because I worked at a different tech company that frequently assessed the feasibility of subscription payments vs ad revenue, and the math just never worked out. There simply aren’t enough people willing to pay an amount that would offset the ad revenue loss. It’s the difference between stated preference and observed preference in consumer behavior.
Why?
I'm not sure about that, either way. I feel like I've seen cases where this is true, and cases where it isn't.
For YouTube, for example, I'd guess this could be true, now. It depends on hours and type of content watched, yes? While the charge to advertisers per ad impression is very low, and low enough for click-throughs / other categories that might be considered 'hits' in advertisers' search for customers*, it is presumably carefully metered to ensure solidly net positive "monies"** to Google. YouTube premium is billed at a flat rate - hence, its worth likely varies rather inversely by "hours watched" as compared to ad-supported viewing, right? I.e., the best "premium" customer, strictly from the POV of max direct revenue / profit should be one who pays and doesn't watch even a second of YouTube content in a given month.
Obviously, I'm simplifying all of this a bit, and, also, not really getting to the point efficiently - Sunday morning blah blah. So, to wrap, it's all about distributions. Oftentimes, when companies introduce plans like "premium", the heaviest users immediately sign up. The distribution is often heavily skewed, initially. Over time, "non-addicts" and such do accrete ... distribution shifts a bit. That's basically why it's not so clear to me - on the one hand, YT premium charges quite a lot, AFAIK, compared to $ / ad ... but, at some number of hours viewed, that stat flips. I.e., YT makes less money (directly, at least) from Premium. Now, that's probably a quite high # of hours. But, I just have no sense of what it might be and what the metrics look like.
And, ultimately, this ended up also being a long-winded way of saying my brain still isn't fully online and I'm too dull / lazy to try and pull up Google's / Alphabet's 10-Ks etc. ... but not too dull / lazy to let the world read a big ol' pile of words! Ugh... Almost as bad as drunk texting.....
* I.e., "more money" - https://youtu.be/aN8wxQDqfRk