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Comment by DoubleMalt | Hacker News Reader

If you're not paying for the product, YOU are the product.

I'm getting very tired of hearing this. It's like we make up excuses for startups being dicks. There has to be a way to find business model that involves showing respect for your users and the content they're creating, while still making money on ads, offers, etc.

It also completely ignores the fact that paying customers get ripped off all the time, by the companies they pay money to. In the wider perspective, being a dick doesn't seem to correlate to receiving money from your user-base.

Here's an excellent text about it: http://powazek.com/posts/3229

I think it's important to keep saying it so that the general population begins to understand it. Eventually it will trickle out. I don't think it has yet. So, while I agree with you that it's an old saying in our circles, your friend's sister may not realize it.

I'd like to see people become more aware of this sort of risk, but I don't think that slogan will take off outside geeky circles, and I don't think we want it to.

There are companies which - by most people's standards - quite reasonably make money from free services. Telling people that they're all stupid sheep for using Google isn't going to get much traction. We need to highlight real problems, like this move by Instagram.

Lots of us also work on open source software, in which case telling people not to trust anything that's free is shooting ourselves in the foot. I don't pay for Linux, Libreoffice or Firefox, but I'm not 'the product' there.

It's not really calling them stupid sheep, but rather a reminder that they are interacting with businesses and they should pause to think about the business model when they do that. It's really about educating, not name-calling.

There has to be a way to find business model that involves showing respect for your users and the content they're creating, while still making money on ads, offers, etc.

I agree with the first part but not the second. What if the best way to show respect for your users is not to pester them with ads and offers, but to let them pay you directly for the value you are giving them?

I think that's my biggest hangup with this. There was never a "Well, we're thinking about doing this with your photos, but we were wondering if you valued the service enough to pay for it instead?"

There would have still been outrage, but people pay to get rid of ads on services all the time.. particularly if they want to continue a streamlined experience. If not, they can tolerate the ads. But using my photos as ads? If I opt-in, sure. But I don't want that by default. I'd rather see something irrelevant than have my likeness potentially supporting a business I don't want to.

I hear this slogan a lot, because it implies that if you're paying for the product then you're NOT the product. Which is false and misleading.

(That's "implies" in the English language sense, not the mathematical sense. Substitute "suggests" if you prefer.)

Purely out of interest, when are you the product (when you pay for the product)?

    - newspapers / magazines with ads

    - subscription TV with ads

others?

Whenever you shop at a store like Target or Walmart.

How so?

They mine purchase data. Any store with a "customer rewards" card does as well.

Don't get a discount card. Pay cash. Problem solved.

I doubt the problem is solved that easily. Stores have been known to instruct cashiers to enter information about customers during the checkout process -- age, gender, race, etc. -- and combined with what you buy, there is probably enough information to identify you or to distinguish you from the set of all shoppers. Some stores print coupons with your receipt; it is not all that unlikely that the profile they are building of you as a customer, even without the use of a customer loyalty card, is used in deciding which coupons to print.

In the future, they might even use their security cameras to add some extra data points. Never mind facial recognition; I bet they would only need to track your walking pattern as you move through the store. Some people like to browse. Some people enter knowing exactly what they are looking for. Some people store by going left, others by going right. Maybe the first thing you do is go to the produce section.

Chances are that this sort of data, combined with other data, can be used to identify you even if you never explicitly gave Walmart any identifying information. If Walmart can distinguish but not identify you, they might make more money just selling your profile to an advertiser, who can combine it with data gathered from other sources to figure out who you are (then annoy you). Maybe it's already happening, but I think it will be a few more years before the technology is really that advanced (I have no doubt that this will happen in the near future, assuming no laws to stop it).

Thanks for answering, I appreciate it. I'm curious how this data is then used by the stores.

The only example I can think of is optimizing store layout based on neighborhood demographics and what those demographics purchase.

However, big box stores all seem so similar - it doesn't appear on the surface that they do a lot of demographic-based differentiation. Unless their demographics are so similar, which defeats the purpose of profiling?

That's a good point. Somebody here the other day said that Google still mines your data on their paid services. I don't know if it's true or not but I would find that surprising and disturbing.

Well of course the reverse is not necessarily true.

!A => B does not imply A => !B .

However I do not think there is any valid business model out there that gives something away for free, without making money off the people that get the freebies.

Essentially even in a freemium model, free users are the product as they are marketing leads.

Accepting that your users are the product does not necessarily mean you should be a jerk to them though.

Wikipedia gives things away for free, and use the halo effect from that generosity to convince people to donate.

You could argue they sell a product under a name-your-own-price model though.

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