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Comment by turnsout | Hacker News Reader

It’s alllll fun and games until the SaaS you 100% rely on decides to become profitable

I guess he can write about this failure to anticipate in his failory.com

I've been speculating for a while that SaaS is a zero interest rate phenomenon.

It's not that the SaaS model can't be economical, it's that all these companies are suddenly expected to beat a much higher interest rate bar and must enshittify rapidly to squeeze their customer base. Since SaaS is absolute lock-in, they can... for a while.

The PC revolution and local software exploded when interest rates were high and in addition to the novelty and flexibility a major driver was cost reduction and having local control over cost. If you can run software locally on your own stuff you can decide whether to invest in an upgrade. If everything is a subscription to a remote system you have zero control, which seems like less of a problem when money is free. Lots of economically irrational things like variable-rate outsourcing with hard lock-in make sense when money is free.

Maybe those of us interested in decentralization and local-first just have to wait for the ZIRP era to unwind.

Look, SaaS, or plain classic Software isn't an inherent enterprise stuff. SaaS model isn't a zero interest rate phenomenon. VCs selling successful software is a ZIRP phenomenon. We will survive without them.

Hear, hear. There are plenty of profitable SaaS companies with sensible unit economics.

This is amplified by the fact that many of those SaaS are startup and privately financed. They are living on borrowed money, and if the money dry up, they will need to move to a viable business model, that is, charging the consumer the real cost.

>The PC revolution and local software exploded when interest rates were high and in addition to the novelty and flexibility a major driver was cost reduction and having local control over cost.

At that time (80s to 90s), computer networks weren't really a thing outside of institutional settings, so it wasn't like there was anything to compete with "local software".

Software subscription is basically a form of loan. Obviously interest rates influence them a lot.

What is different from the ZIRP inflating unsustainable startups. SaaS is a loan even when it's bootstrapped or financed in a normal way.

totally unrelated comment, he spent 3x-5x times is allocated bandwidth of 400GB, it is his fault and should have been more cautious about it

You missed the part that this bandwidth limitation didn't exist when he signed up. Not sure how he can prove it or if he missed reading it.

Exactly. You sign up when you're just playing around, and the product is free or cheap. It's easy to ignore the details of the enterprise pricing at that point, even if it exists and is prominently displayed. By the time you need enterprise pricing, you're locked in and they've got you.

I'm not anti-SaaS by any means, but it's a cautionary tale about over-reliance on services that are way outside your control.

Not unrelated at all. Webflow is suddenly using the excuse of 3x bandwidth usage to justify a 3x increase in subscription price, when we know that this isn't proportionate to the underlying hosting costs.

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