Unfortunately it is exactly what users "want".
Any for-profit social media will eventually degrade into recommendation media over time.
It’s our human lizard brain on dopamine.
Any for-profit social media will eventually degrade into recommendation media over time.
It’s our human lizard brain on dopamine.
It turns out that demand matters when you sell a product or a service. And it is elastic in ways other than price (such as convenience, value, appeal), but not infinitely so. In plain English, you can force anti-social media onto the market by making it appealing/hooking/addictive/convenient/supposedly valuable for a while, but not indefinitely. People do demand proper socializing, especially recently. Many are realizing they've been sold a total bag of goods just because they consumed it, and it's not good enough to displace real human connection.
My takeaway from that presentation is more that:
* Games cost more to make but there is resistance from players to pay more
* A number of growth areas (mobile, social gaming, displacing other forms of media, battle royale) are exhausted
* A lot of attention in China is moving to Chinese-made games
* The marketplace is overcrowded with titles
* Gaming is more social now, so a significant number of users are sticking to the same big 5/10 games where there friends are, which leaves even less room for the zillions of new games to gain traction.
I think the industry had a role in this, namely in locking people in to games, and simultaneously overspending on and underpricing games. But I'm not getting the sense (at least from this presentation) that the new games that are coming out aren't what users want.
Just like Facebook, the first-mover advantage has favored many now-established studios and franchises. They exploded game-development costs because they could, and funneled these costs into marketing and moat features indie developers could not build (such as huge open worlds, amazing sweaty character face wrinkle rendering tech, and SOTA systems). But many of these companies did not respect the player's wishes for well play-tested games with interesting stories and mechanics. Still, they captured the top 20-30 franchise part of the annual net bookings, and strongly compete in the top-50 game part. Some even built some black hole games (GTA Online, Rainbow Six: Siege, Fortnite). For a long time, they avoided much of the pressures felt strongly by smaller companies. They were "above" the 99% of games that have to compete for close to 1% of the revenues. Their marketing was so strong (plus, they strengthened it with access journalism) and features so moated, they could do no wrong.
However, over the last 5 years, things have changed. Many AAA industry legends have left their jobs at major studios to start small studios and create games as a form of interactive art, rather than to make publishers rich. Ultimately, in their view, the greed and blind following of what players would consume (trends) in large numbers led to a sterile industry that could no longer create art.
The growth engines got exhausted because players did not actually demand what they were offering, such as season passes, eSports corporate shooters, microtransactions, padded playtimes, user-generated content, and the other things. The new growth engines (AI, targeting kids, etc) are also what the players don't want very much. The industry understands it, and investors are starting to catch on after facing a decade of poor returns, too. The crucial point I am trying to make is that the industry spent a lot of money on these growth engines that the players didn't truly want, led by market metrics that genuinely showed they were consuming it. But now the gig is up, the writing is on the wall, and everyone inside and out of the industry sees it.
As a contrast, many Eastern companies (Nintendo is an especially prominent example) stuck to classic pricing models, did not inflate the cost of their games with their money for moat (most indie developers can make games to compete with Nintendo outside of the IP), and never used the growth engines used in the West. These companies, along with many people in them whom I know personally, are largely unaffected by the industry crisis. They were always making games their users wanted.
Finally, I have to say, the industry is split in two. 8/10 AAA companies are struggling because they cling to the growth engines (old and new) that the players don't want. About 2/10 game developers and publishers genuinely build games that people want, even in the West. And now that the pressure is up, some AAA executives from the 8/10ths are becoming acutely aware of this. Emphasis on "some". So, yes, the industry in some part was, is, and will continue to make games that players want. But the more interesting part for our discussion is the large part of it that wasn't, isn't, and perhaps won't be.
Of course, there's some probability I'm reading this wrong. I'm making my business bets in the industry based on it, but that doesn't mean it's necessarily right.
And thanks for reading the report before engaging in the discussion. That is appreciated.
It's a little bit more involved than that. Games don't have to cost much more to make, they just are due to declining quality of leadership and poor executive decisions. It's more like, "AAA studios are running their budgets up (arbitrarily, usually not driven by any customer request or engagement)" and "players are resistant to paying for that".
"Clair Obscur Expedition 33" literally just came out a few days ago. It's gorgeous high-fidelity AAA-like art, it's super well done, it's incredibly well received, and it's retailing at $50 ($60 for the 'Deluxe Edition') at launch (not including current steam sale). It's doing great, because they made a great product, kept to a reasonable budget, and sold it at a reasonable price. Oblivion also just got a remaster at the same pricing by Virtuos, and it's doing really well. Baldur's Gate 3 is also another example, amazing title, AAA quality graphical fidelity, $60 launch pricing (digitally on Steam & GOG, anyway).
Compare that to something like Ubisoft's "Star Wars Outlaws", which was $70 digital base ($130 Deluxe Edition) at launch. Yes, it's high-fidelity and AAA-like too, but it's very much not well done, it's not well received, and it's arbitrarily super expensive on top of all of that.
Games don't just "cost more to make" automatically, it's mostly not based on inflation or underlying costs. AAA studios are increasingly more mismanaged (or just demanding higher margins) than they did before, and that mismanagement is impacting their cost structures. Instead of fixing those mistakes, companies are expecting players to just forever eat those additional costs.
If the game is really, really good, they might get away with it. (Nintendo, probably). If their games aren't that good, players are going to walk (Ubisoft).
It's not "the market is saturated". It's not "the market is overcrowded". It's "the market is competitive and expects quality", you can't just shove a half-baked only-ok game at high pricing, and expect it to be a success.
That doesn't contradict what I wrote, so much as expand on it. The presentation linked above (which I was attempting to summarize) says there's a push for, for example, more photorealism, that players don't really care about, but balloons various costs. It also mentions recurring costs for online games too unpopular to cover their expenses.
> It's not "the market is saturated". It's not "the market is overcrowded". It's "the market is competitive and expects quality", you can't just shove a half-baked only-ok game at high pricing, and expect it to be a success.
I don't doubt what you're saying about quality of gameplay, but that's really not the focus of the linked presentation. It mentions that too many game studios are chasing dead trends, and unpopular payment models. But it's also making the claim that there might be tons of great new games coming out, but hardly anyone is even trying them.
Honestly I'm out of my depth with this, as I barely game at all, and if you had asked me yesterday, I would have thought the industry was still booming. I clicked caseyy's link and expected something concise about the state of gaming, but ended up reading (most of) a 200-slide presentation.
This just can’t be anything but nonsense when EA can release the same game literally decades in a row and have people eat it up anyway.
HN just doesn't skew really getting sports people.
The growth numbers don't show what people attribute to them. That timeframe aligns with increases in discretionary spending, and also QE/loose financing requirements. The boom bust cycle can easily be explained as a result of debt financing, and leveraged buyout.
The bust part of the cycle is what you get naturally when you finance poor investment choices.
This is the same Atari story, all over again. Those spends also don't appear to normalize against inflation.
Main console manufacturers also require additional costs which the developer must carry if you want to develop games on those platforms, and the industry has been devoid of anti-trust for decades, and exploitive of its workers (all which increase costs), and regulatory is paying much closer attention to deceptive business practices, with addictive design in some places being comparable to civil battery. The elements for this type of design are scientific, and are based in early last century torture findings.
What you naturally get is overinvestment, shortfall in delivery, stark losses, and a burning down of your supply logistics, where they stop carrying your goods, and won't carry your goods at any price (even on contingency), on top of the rising costs. In other words, you have benefits front-loaded, followed by diminishing returns, followed by outflows exceeding inflows. This is Ponzi, followed by deflation leaving the market chaotic.
Cooporation between large platforms and developer monopoly has shrunk the market over time as well. Extracting revenue in a race to the bottom, with fixed barriers to entry concentrating marketshare.
With this approach, everybody wants fentanyl.
Open a restaurant masquerading as providing high-quality, locally sourced organic food, discreetly sprinkle the hardest drug on the most popular plates, slowly increase the dosage until people are completely hooked, and voilà, you can legitimately claim "people wanted the drug; it was their choice."
Sure there are nice small restaurants. But look at all the big chains.
And we all probably would want it if we tried! It's not that we're in any way better than the folks suffering from opioid addiction. It's all just chance.
1. At-scale boycott: would you eat at a McD's where the "Happy Meal" has fentanyl in it? But somehow, this doesn't work for "social" media -- we're all aware what it is, yet we still use it, unironically.
2. Regulation: if a food inspector eats at your restaurant and confirms rumours that your food is actually addictive, your restaurant will get shut down. But somehow, FB/IG/etc. can operate without regulation, and free of any consequences. Sarah Wynn-Williams' book "Careless People" is worth reading.
This is largely a communication problem. Fentanyl is unacceptable, but a large subset of people would be glad to get food with CBD oil for free. Or caffeine - as last year's Panera charged lemonade scandal [1] revealed. Or alcohol, that's already very normal. Or monosodium glutamate, a personal favorite of mine which was once surrounded by negative press, or high-fructose corn syrup, or trans-saturated fats. Or maybe not an intentional part of the food, but traces of herbicides, pesticides, and antibiotics may end up in food, and microplastics or PFOS from packaging will be eaten as well. And I'm sure you've seen old advertisements for cure-all elixirs that contained cocaine.
Health experts know that certain ingredients are bad, and many others are regularly consumed in quantities far, far exceeding their safe levels, but you don't have to look too deeply at a grocery store shelf or fast food menu to realize that the contents are boycott worthy but normalized to the point of being inescapable.
People know even less about what Meta is doing with their data or what their addictive apps do to their brains, and are equally powerless to learn about it or change it.
[1] https://apnews.com/article/panera-charged-lemonade-drinks-ca...
The fact that Zuck (and Elon) are all buddy buddy with the current admin in Washington shouldn't be lost in the conversation.
Well, part of that is because people got addicted gradually, starting before it was common knowledge. Another part of it is that people actually do need to use these services (for some reasonable definition of "need") because some friends, family members, government/community services, etc. can only be contacted via these services.
It started as small roaster of coffee but now it’s a Sugar+Caffeine drink system for addicts.
One difference that may possibly affect the strength of your argument is that fentanyl is a physically addictive drug. Social media may be "addictive" but they aren't addictive. If you genuinely believe they're equivalent, use social media for a year, and fentanyl for a year, and see which is easier to quit.
Actually, scratch that: make it a thought experiment. But if you can see that they aren't equivalent, you can see that it's not a good comparison.
Mileage varies for different people, of course. But dopamine is dopamine and addiction is addiction and it's neither kind nor fair to tell someone else that their addiction isn't real because there's no change in their blood chemistry.
It’s actually what users want “now”. When instagram initially stopped chronological feed users didn’t want it. When they started injecting random posts from people you didn’t follow. Users didn’t want that either. When they launched reels, they also didn’t want that. When they started almost exclusively showing reels like TikTok, users still didn’t want that.
The problem with all of the above is that users eventually got used to the new norm and their brains established the dopamine rewards pathways according to what they were offered. And that’s why they think they “want” it now.
But we’ve seen this happen before. FB did the exact thing and now it’s almost dead, even Zuckerberg acknowledged it. But they somehow think, users won’t eventually get off Instagram because somehow this time it’s different?
I check Facebook less than once a month. I want to see what my distant friends are doing. Instead though I see subversive political memes, and other things (jokes) that are fun once in a while but not worth spending much time on. Because Facebook isn't giving me what I really want I gave up on them. But it took me a while in part because the things I want to see are there - they are just hard to find.
Whether it's good for society is another question but, users definitely didn't show that they "wanted" a chronological feed, they only said it. There was a JUMP in engagement, not a decline.
But you can make that case for most business models. Restaurants? They’ll all eventually turn into fast food chains, because our human lizard brain appreciates fat and sugar more than actually good meals.
Gaming? Let’s just replace it all with casinos already. Loot boxes are just gambling anyways.
There’s absolutely a market for proper social media that’s actually social. It’s just that companies are way too greedy currently.
If your "users" are the guys in charge of showing more ads to people, then yes. People, on the other hand absolutely prefer watching their contacts' posts first. Recommendations related with their individual preferences, second. Random dopamine-inducing stuff, only from time to time. If you prioritize the third kind only is like someone said already on the commments here: like a restaurant that only serves candy. They will have customers for a while but eventually they will burn them down (or kill them).
I also browse random junk on xitter. It's a different thing.
Does an addict really want to be an addict? The Light Phone, screen time features, and various other things exist for a reason. People don’t want this, but feel helpless to break free from their addiction, which entered their life like a trojan horse.
If Mark Zuckerberg forcibly injected educational material and long form journalism into everyone's feed the average user would uninstall the app. People have been consuming crap since they were able to draw boobs on cave walls with chalk. Do you know why every belief system that claims people are ensnared by some false consciousness fails? Because they aren't, there's no such thing. Mark Zuckerberg is exactly right about one thing, he gave the people what they wanted, and if he's going to lose to a platform like TikTok it's because they're even better at it
I might fine tune this to "users most likely to click ads"
And with both in the same platform… I know where I’m going.
I think another problem are network effects. They make it much harder to build a reasonable alternative
Your implication is correct in that there is no reasonable alternative for distracting oneself. At the same time, I'm not sure that if you were to build an alternative, it would not degrade into "content" scrolling as well.
-under network effects, you can’t spin up a viable indie alternative (like you could for a note taking app) because you need to massively attract users
-the less engaging social platform is the less economically viable social platform
So the natural end point for any social app is content doomscrolling
No it isn't. No one "wants" to be addicted.
> Any for-profit social media will eventually degrade into recommendation media over time.
They will measure you then do everything they can to increase the number of minutes you spend on the site. The media recommendation is a consequence of cost. It's very cheap for them to maximize your time spent using other peoples content.
> It’s our human lizard brain on dopamine.
There are tons of ways to get dopamine flowing into your brain. Which is why it was important for Meta to monopolize and dominate the field. Turns out lizard brains are exceptionally fickle.
Not consciously, no. But our conscious mind is just the tip of the iceberg, half-filled with post-hoc rationalizations for numerous unconscious urges. We don't have to call them "wants", but maybe "desires" works better.
Taming our internal animal nature is possible. People don't for all kinds of reasons. This leaves them susceptible to simple addictions.
Most users want to scroll through internet TV passively. However there is a big enough minority of users who want authenticity, novelty, and creativity in their online experiences. This group is big enough to sustain, say, a social network.
We've just never solved the Eternal September problem.
I am a part of more genuine social networks now then when facebook launched. They're all around you, it's just "giant supermassive public square" never really worked even with strong recommendation algorithms to try to ad-hoc connect related people and cut down on the perceived size.
Most of them live on Discord, others on the fediverse, none are large by any metric and highly personal.
This is like an old school forum optimizing for flamebait threads, it's clearly not going to work. The major problem is that while advertisers love engagement they hate toxic content, low quality content, violence, drugs, porn, illegal activity, extremism, bots, trolls, etc
Eventually the media will build some story and the bottom will fall through, this process is just slower than usual because users are siloed into bubbles (like if you report a racist video they will show you much less, but there are still tons of people watching tons of racist videos and getting ads)
Young people in Europe and North America do not use Facebook anymore, if they even have an account at all.
It is still popular among older users in North America. This is one of the wealthiest demographics on earth, so Facebook’s advertising model will be ok for the foreseeable future.
Growth is still positive on Instagram and WhatsApp, though Instagram’s engagement levels have begun to decline.
Facebook’s main growth areas for all three apps are in the developing world. They pay carriers to allow Facebook to be accessed without counting against user data limits, so in a lot of these countries Facebook is synonymous with The Internet. Young people in these countries still see Facebook as cool, and they aren’t as likely to seek out platforms to avoid their parents on. The key problem is that these markets are not worth very much to advertisers because they have low levels of discretionary spending. This makes operating in these markets a long play for Meta; they spend some money on subsidies to build a user base in the hope that the users will gain higher levels of discretionary spending in the future, increasing the value of the market for advertisers.
what *some* users want.
sure, it may have been a majority at the time. but imo chasing that was incredibly short sighted.
many many many people warned them this would be the outcome. in typical fashion for these people, they ignored it, imagining themselves to be smarter in every area than everyone else.
i’ve said it before and i’ll say it so many more times: we need to better at realizing where our intelligence is behind. some people are untouchably genius in social situations but absolutely terrible at stem. and some stem people may be absolute genius at engineering work but entirely lack understanding of social/humanity issues.
far too often only one of those two groups understands their lack of understanding. if you ask the best party planner in the state to engineer an automobile, they’re going to look at you like you’re a crazy person. ask the best engineer in the state to plan the years most important ball, we’re going to fully delude ourselves into thinking we can do it better than the party planner.
This is unironically why I think we need a government funded non profit website for friendship and dating. Any such site subject to the whims of capitalism is doomed to become toxic
Social media is just fine. Trillion dollar ad conglomerate staffing menlo park software engineers making 500k/yr? That requires enshittification.