This is the most willfully ignorant take possible and contributes nothing to the conversation.
Teach companies always wanted money. The question is “why do tech companies recently think that limiting their user-base and getting rid of free labor is a good way to increase the amount of money they get? What has caused the meme of this strategy to spread, and what was the initial reason for its inception?”
This has been happening since the 90s with websites and software products. It has to do with the life cycle of many tech companies. In the beginning they are often flush with money from venture capital, so it’s all about gaining users and providing the best product to the user they can. Got to get that network affect and reach a critical user threshold to get more venture capital money. Eventually there comes a point where the venture capital firms want to get their money back and to get a profit, so now the tech company has to stop operating at a loss and figure out how to make money off of their users. Often the only revenue stream is advertisements and getting more $$ to become profitable is easier said than done, and low hanging fruit items that can cut costs are implemented, usually at a cost of the quality to the product. So, you lose some users, but if you don’t lose too many, and now your costs are under your revenue, you can start being profitable. For Reddit, say they lose 10% of their users, they don’t care, particularly if the new less used site takes in more $ than it costs to operate. Something that has not been the case since its inception. Money isn’t the only enshittifcation force, but it’s the most common. You see it when private companies go public, you see it when venture capital firms want their money back, you see it when a monopoly is reached, etc.
This is the most willfully ignorant take possible and contributes nothing to the conversation.
Teach companies always wanted money. The question is “why do tech companies recently think that limiting their user-base and getting rid of free labor is a good way to increase the amount of money they get? What has caused the meme of this strategy to spread, and what was the initial reason for its inception?”
This has been happening since the 90s with websites and software products. It has to do with the life cycle of many tech companies. In the beginning they are often flush with money from venture capital, so it’s all about gaining users and providing the best product to the user they can. Got to get that network affect and reach a critical user threshold to get more venture capital money. Eventually there comes a point where the venture capital firms want to get their money back and to get a profit, so now the tech company has to stop operating at a loss and figure out how to make money off of their users. Often the only revenue stream is advertisements and getting more $$ to become profitable is easier said than done, and low hanging fruit items that can cut costs are implemented, usually at a cost of the quality to the product. So, you lose some users, but if you don’t lose too many, and now your costs are under your revenue, you can start being profitable. For Reddit, say they lose 10% of their users, they don’t care, particularly if the new less used site takes in more $ than it costs to operate. Something that has not been the case since its inception. Money isn’t the only enshittifcation force, but it’s the most common. You see it when private companies go public, you see it when venture capital firms want their money back, you see it when a monopoly is reached, etc.
Read more about it and worded better than I can: https://pluralistic.net/2023/01/21/potemkin-ai/#hey-guys