Why do so many tech companies, like Reddit and Twitter are making their platforms worse for their users all of a sudden?
Why do so many tech companies, like Reddit and Twitter are making their platforms worse for their users all of a sudden?
Here is how platforms die: first, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves. Then, they die.
from Cory Doctorow's article on 'enshittification', which has become mandatory reading.
Just to add, the concept of a bait and switch, where you lure a party in with something and then swap it out once they are committed, is not a new idea in the slightest. This is just a modernized, refined tech version.
Uber and Lyft are good examples. Drive out most of the competition with an aggressive early phase where you spend most of your capital to shore up a massively negative balance sheet. You are baiting the customers to you with very low prices.
Then once the competition is eliminated, you raise your prices on the captive consumers that rely on the service to recoup your costs and start making money.
If you, in a video game, have ever lured something in with ranged attacks and then switched to melee to kill it, by plan, you executed this same strategy.
Every single discounted trial period for a subscription is employing a riff on the same concept, where they hope you're too lazy to cancel.
Fools been falling for the bait and switch since ... oh dawn of civilization maybe? Awareness of it defeats it, people don't take bait when they know it's bait. It is not complicated though, and does not require complex understanding to grasp.
IIRC, it's in the article, but what makes enshitification so prevalent in tech is that it mostly involves networks, wherein part of the value of using the application comes from the presence and concentration of other users and providers on it (network effect). Even Amazon, Netflix, and Uber, are subject to that effect because they capture providers, not just users you will interact with. It's a somewhat uniq trait that really exacerbates the problem. This trend will probably continue untill interoperability is legislated.
Your metaphor reminded me of killing vampires in Skyrim and it made me smile as I also feel a deep sorrow from the fact all major companies now are racing to the bottom while leaving their skidmarks on everything I used to love.
This can't be true, Reddit said they cared about community /s
They do care about 1 very specific, very niche community. Their shareholders.
That was a good read, the thing is that it seems that all of a sudden a lot of tech companies are getting more and more anti-consumer. I mean it’s not only the whole Reddit and Twitter thing, now Youtube is getting more aggressive with adblocking, Stackoverflow and their mod protest, Google dropping support for the open source diaper and messaging apps on Android…
Many companies are getting more aggressive against their customers, and in the end it feels like the internet as it used to be is really dying, and we might end up with the whole “dead internet theory” becoming reality. I don’t know it just feels very depressing.
If you haven't already, I suggest reading Stop Talking to Each Other and Start Buying Things: Three Decades of Survival in the Desert of Social Media, a blog post by Catherynne M. Valent. (It's actually referenced in the article above.)
It's long, funny, and angry and damn, did it strike a chord with me. It was written in December, '22 so pre-Reddit meltdown but still very relevant to it.
Some highlights include:
Stop talking to each other and start buying things. Stop providing content for free and start paying us for the privilege. Stop shining sunlight on horrors and start advocating for more of them. Stop making communities and start weaponizing misinformation to benefit your betters... It’s the same. It’s always been the same. Stop benefitting from the internet, it’s not for you to enjoy, it’s for us to use to extract money from you. Stop finding beauty and connection in the world, loneliness is more profitable and easier to control.
Over and over again ... I’ve joined online communities, found so much to love there, made friends and created unique spaces that truly felt special, felt like places worth protecting. And they’ve all, eventually, died. For the same reasons and through the same means, though machinations came from a parade of different bad actors. It never really mattered who exactly killed and ate these little worlds. The details. It’s all the same cycle, the same beasts, the same dark hungers.
All ... gone. Dismantled for parts and sold off with zero understanding that the only thing of any value the site ever offered was the community, its content, its connection, its possibilities, its knowledge. And that can’t be sold with the office space and the codebase. These sites exist because of what we do there. But at any moment they can be sold out from under us, to no benefit or profit to the workers—yes, workers, goddammit—who built it into something other than a dot com address and a dusty login screen, yet to the great benefit and profit of those who, more often than not, use the money to make it more difficult for people to connect to and accept each other positively in the future.
It does end on a hopeful note, though.
Don’t ever stop talking to each other. It’s what the internet is really and truly for. Talk to each other and listen to each other. But don’t ever stop connecting. Be a prodigy of the new world. Stand up for the truth no matter how often they take our voices away and try to replace the idea of reality with fucking insane Lovecraftian shit. Don’t give up, don’t let them have this world.
Don’t get cynical. Don’t lose joy. Be us. Because us is what keeps the light on when the night comes closing in. Us doesn’t have a web address. We are wherever we gather. Mastodon, Substack, Patreon, Dreamwidth, AO3, Tumblr, Discord, even the ruins of Twitter, even Facebook and Instagram and Tiktok, god help us all. Even Diaryland.
It doesn’t matter. They’re just names. It doesn’t matter who owns them. Because we own ourselves and our words and the minute the jackals arrive is the same minute we put down the first new chairs in the next oasis. We make our place when we’re together. We make our magic when we connect, typing hands to typing hands.
Hello, world. Come in from the cold. This will be a good place. For awhile. And then we’ll make another one.
Stop buying things and start talking to each other. They’ve always known that was how they lose.
2022-'23 really has been the year of enshitification
But I think it all started with Tumblr
I think you mean dialer.
Many companies are realizing they can screw their users over and turn a profit for their actual bosses, the shareholders. Whether that's true only time will tell.
Many companies are getting more aggressive against their customers
Oh no, they are getting more friendly to their customers. The thing is, you’re not the customer, the ad companies are the customers. You’re the product they’re selling. And they want to improve the product by controlling it more.
Many companies are getting more aggressive against their customers, and in the end it feels like the internet as it used to be is really dying, and we might end up with the whole “dead internet theory” becoming reality. I don’t know it just feels very depressing.
With all the distributed social networks getting popular only among tech-literate people it feels like we're getting a reverse- Eternal September as well.
I had just copied the link to post this.
Read this for an actual answer.
That was an excellent read and something I've observed many times but failed to describe so well. I really like the analogy of the big teddy bear.
Is it possible for Lemmy to become enshittified? If so, how? Given that it has federation at it's core and it's not owned by any one entity, wouldn't the greater community just abandon the bad instance and self heal, like a lizard loses it's tail?
I understand how federation could die, like what Google Talk did to XMPP, but not how Cory's described process would affect Lemmy.
I think the exception is companies “too big to die.” They serve as the archangels of tech so ALL other goals lead to being bought by FAANG or dying.
This, just this
Capitalism. Monetise everything no matter the cost to the users
To expand on this, it's not just capitalism - it's greed.
Potato potato
@Nollij @breadsmasher
one in the same
money, power, greed - all part of capitalismI don't think "greed" is quite the right word. "Greed" would be the right word if they were trying to make themselves more profitable. But they're not: they're trying to make themselves profitable at all. That's not about greed, but about surviving. You can't survive unless you stop hemorrhaging money at some point.
Maybe the question is "Why do investors invest so many hundred of billions of dollars into companies that cannot be profitable without becoming super-shitty? And why do users join them knowing that they're going to become super-shitty one day?"
To expand on this, it’s not just capitalism - it’s greed.
No it's just capitalism lol. Every company has to continue reaping in profits for capitalists or else it dies. This is just Reddit's way of doing that.
do you think this move will be good for their business?
You ask on Lemmy…
What’s good for making more money is not always or even often good for what we would think of as customer-friendly business. If you can wring more money out of a few whales at the expense of pissing off customers who don’t create as much revenue, then in our current system that’s what shareholders apparently want.
Reddit wants more users in their official app where they can target them for ads, sell NFTs, and whatever other bullshit they want to sell. It doesn’t matter if the experience is worse, and it probably doesn’t really matter if a couple thousand 3PA users split for good. As long as they can tell investors that the official app use is growing and that they can target a greater percentage of users with ads and data, they feel like they won.
I like how it's already bad not only for Reddit, but for Google as search engine as well, as "reddit" is what many people put to thir phrases to find content. Now such search results are mostly useless.
In the short term? Maybe. Long term? Probably not.
But first be not as terrible to the users to attract them, then hope they're lazy enough to not go anywhere when you treat them terribly later while they squeeze value from them
But first be not as terrible to the users to attract them, then hope they're lazy enough to not go anywhere when you treat them terribly later while they squeeze value from them
In short: money.
Long story is that a lot of these tech companies started as startups funded by VCs.
Borrowing money was cheap so they got dumped buckets of money onto them to burn in an effort to try to get a foothold and/or kill off competition by undercutting them.Now that they've gained a foothold and in some cases have a near monopoly or duopoly and now that borrowing money isn't cheap anymore, they need to start cutting cost if not outright turn a profit.
And so the enshittification begins.
Specifically for Twitter, Musk needs to cut cost because he bought Twitter at a severe premium and has made it less valuable by the minute ever since he took over. This to the point that he is leaving bills unpaid.
Specifically for Reddit, they've burned through all that VC money and have been eying a juicy exit in the form of an IPO. An IPO would be a payday for everyone who initially invested into Reddit because now they can sell their shares for more than what they invested (or at least that's their hope). In order to get a good price once they go public they want to cut cost and increase revenue to seem as valuable as possible.
Specifically for YouTube, the ad game has been generating less and less revenue over time and advertisers have been burned in the past by having their ads placed next to objectionable content.
So the knee-jerk reaction is to severely tighten the rules for content, lest they be demonetized.
This however made creators realize that their livelihood in the form of the pittance that's called AdSense payout is very fragile, so they started moving to doing sponsorships, soliciting Patreon donations and partnering with Nebula.Now YouTube is missing out on those revenue streams and often ad revenue as well as creators often turn off ads on their video when they have sponsor deals etc. So what does YouTube do? They started monetizing videos of creators who are not eligible for their partner program (i.e. place ads on videos and not share it with creators) and not give those creators the option to turn off ads, they started severely increasing the amount of ads on videos that do run ads, they started severely pushing YouTube Premium and now they're cracking down on adblockers.
Yeah man, it sucks. We won't miss Twitter because there are alternatives, i think the fediverse has the potential to be less predatory and more stable over time while facing its own issues; but for YouTube, i got nothing. Video hosting is expensive, there's no way around it, whether it's for centralized servers or enthusiasts running their own instance.
There is PeerTube, which is kind of the Fediverse's answer to YouTube.
It doesn't really fit to YouTube the same way Mastodon fits Twitter and Lemmy fits Reddit, but it's relatively well used outside of the West, due to local governments blocking YouTube etc.
They’re aiming to maximize profit
Their profit centers are advertising and selling api access to content libraries
So they don’t want you to see posts with long narratives, extensive image galleries, long videos, etc. there are some exceptions to this of course like YouTube and other streaming services that embed the ads and as a result want long videos that engage the user. But Reddit, Twitter, TikTok, Insta, etc want page views. Once you take venture capital you’re fucked, they demand a return on their (typically massive) investment and will insist you sell your soul to advertising ghouls. All the socials did that long ago
That way they get maximum impressions and can serve you the most ads. They also get more data on you quickly and can use analytics to develop a profile for more targeted advertising which is more lucrative. The dream is that you view a post for 10-30 seconds, react quickly (like or upvote or whatever) then move on to the next one. This is also why they tweak their algorithms to promote garbage content. They want content that grabs an audience. R/stupidfood, fightporn, diwhy, conservative, politicalcompassmemes, etc plus the spattering of news where people react to headlines without readings are the dream to them. Why do you think they let the_donald fester when it was obviously breaking sitewide rules every single day? Because it drove engagement through ragebait. “Oh did you see what they did now?”. These are Reddit centric but the other networks are largely the same, a push to prioritize content that is ugly and rage inducing to drive engagement. They completely disregard the potential social impacts of this. Maybe it makes people more angry and more irritable, more impulsive, less empathic, more divisive, etc. but they’ll hide behind “we are giving the people what they want” because they have a complete disregard for ethics and no regulatory oversight at all.
Wrt Reddit specifically at the same time they do want some engagement with commentary because they want their cake and to eat it too. But they want this for the benefit of being able to add an additional revenue stream with selling API access to commercial clients. The biggest example is LLM stuff like chatgpt. If you need to train your AI language model you needs tons of naturalistic colloquial writing. Reddit is a perfect place for this. I mention chatgpt because they were using Reddit for this already and Reddit had mentioned them numerous times to the point that they’re clearly pissed about it. They think chatgpt owes them money as part of their success. They realize they missed that boat so this is likely another driving force in the api changes.
Additionally the content drives traffic. Reddit specifically shows up organically in tons of twitter searches and this is because of the massive amount of content they have. Other social networks have this content but they don’t make it as accessible and searchable so they’re not as concerned here.
The solution is to continue to decentralize. Imo lemmy/kbin are good but as an old head I think we need a return to the late 90s/early 2000s internet where communities were completely decentralized from each other. If the administration of your community goes to shit then only your community is fucked. This whole thing where a “platform” for communities lowers the bar which is nice but if the administration fucks up a lot of people get fucked over and a lot of communities get wrecked
Tldr advertising is cancer that will do anything for a few more dollars even if it’s destructive, the us government does basically nothing to regulate them, and we actively tolerate and invite it to our lives so expect it to get worse
What's funny about the LLM stuff is Reddit must know where those API calls are coming from. This is RiF's calls. This is Apollo's. They could have ring fenced every app easily. They could have then introduced a 'If you're not in the Genuine API list, you have to resubmit your application or you pay at this higher tier'.
I think most would not have cared if OpenAPI would have faced these costs. They'd likely have cheered Reddit on for taking a chunk back from Microsoft.
Accessibility apps could have been pre-approved too. Instead, they tried to have their cake and eat it and have all the ingredients left over at the end. They could be sitting high with a new revenue stream for high-call low-community impact API calls. But, tried to eat all of that cake at the same time.
think we need a return to the late 90s/early 2000s internet where communities were completely decentralized from each other. If the administration of your community goes to shit then only your community is fucked. This whole thing where a “platform” for communities lowers the bar which is nice but if the administration fucks up a lot of people get fucked over and a lot of communities get wrecked
I don't know what you mean. If one instance falls there's a million fallback communities. If the developers of the software itself fuck up instances just won't use that new fucked version.
It’s definitely a lot better but like if lemmy.world goes down it takes a lot of communities with it scrambling to find homes on new instances. Maybe if each instance itself was a community? That would probably be a nightmare though in terms of building up a user base.
Or maybe I’m just misunderstanding it, I’m kind of new to lemmy
Capitalism. The incentive for any large, profit-motivated firm will always be to get the most people to pay as much as possible for as little as possible.
- Startup releases nice product
- Product is cheap or free
- Startup gains huge customer base while burning through money
- Investors are interested
- When initial money runs out, startup either asks for VC money or goes public
- Now investors want more growth
- Product goes through enshitification to extract more money out of customers
- Product loses customers as it loses its original charm
A tale as old as time
In the tech world I've heard it called enshitification. Basically what you layed out but with a little nuanced difference.
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The growth of online advertising revenue slowed in 2022 for the first time since 2009.It still grew, just slower.
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Interest rates went up.
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With the collapse of crypto and Silicon Valley Bank (which was overleveraged in crypto), VC money isn't as free flowing. There really wasn't that much institutional money in crypto, but it's still a destablizing force and has had a ripple effect.
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AI is making more people aware of bots. This is related to point #1. A huge, unknown percentage of of FAANG revenue is selling online ads to bots instead of real eyeballs and once the word gets out, ad revenue will slow even more for any service depending on online ads (eg reddit).
One correction,, SVB was not over-leveraged in crypto, they had too many government bonds when the interest rates went up, devaluing them.
That makes a lot more sense. Thank you.
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The interest rate hike in the USA by the federal government caused this. The companies can't borrow money for nearly free any more. All the entities who would have been offering these loans are now able to buy government bonds with a much more guaranteed return on investment. This means the corporations must squeeze more profit out of their products to pay back loans. There are an enormous amount of large money transactions like this used to run a large business. They do not operate on cash reserves all the time. They have assets and are always evolving to stay relevant. Most businesses have enormous asset holdings but limited liquidity.
This best answers the OPs question. We know why it happens in general, but this is why everything is doing it in overdrive right now.
I also think Spez is trying to rush into an IPO before the bottom truly drops out and the company folds.
There's also a clampdown on venture capital happening now. Investors are getting tired of waiting indefinitely for returns on over-valued media companies. For any running in the red, things are going to get tight. That means layoffs that result in lower quality service and more burden on users for revenue. Social media has never been a profitable and sustainable corporate enterprise.
A lot of the value was thought to be in LLM's but with the meta weights leaked, and the open source ability to patch the weights without refactoring the base, or even becoming a detriment, controlling all the data holds less value.
Money was basically free until now, making promises of infinite growth to investors possible. Not anymore.
This is the best answer. For a long time, VCs were willing to load up all sorts of startups and growth-stage companies with cash. But that changed last year. Suddenly, some investors found it made more sense to park their money in less risky, less time-consuming opportunities. That included stuff like bonds. Higher interest rates and an economy in crunch mode made the need to make money now more important than before.
Interest rates go up. Quantitative Easing go down.
They might have to play with real money lol
This is it. For nearly 15 years money was basically free for tech companies. Banks don't pay anything, bonds don't pay anything, the stock market is overheated and investors are still looking for return. So if your tech company was already public you could borrow in the form of bank loans or bonds for dirt cheap and if it was still privately held you can get money from individual and corporate investors.
Now that the free money era is over a lot of companies have had to finally think about making a profit so that they can keep the lights on. This is why there have been tens of thousands laid off in the tech sector in the last year or so.
As far as Reddit goes I have no idea what they've been thinking. It seems like they've been spending money developing features nobody wants or needs: locally hosted images and video which have to cost a fortune, live chat, and NFTs, to name a few. They've got the ~20th most popular website in the world with millions of daily active users and they can't figure out how to make it profitable?
The API the third party applications used doesn't serve ads. All they had to do for a bump in revenue is to insert ads and require third party applications to display them or risk losing their API access. Users would grumble but it's a pretty reasonable ask. The fact that they didn't do this demonstrates to me that they don't think the money is in serving ads, they think it's in data mining and they can only get the data they want from the official app.
Great read, thank you.
That actually explains it, really, a good read.
Excellent article - thanks for sharing
Enshittification has only lasted for as long as it has because the internet has devolved into "five giant websites, each filled with screenshots of the other four"
Snailed it.
$$$ M O N E Y $$$
-- Mr Krabs
The meme became real life
Billionaires are circlejerking all push backs against wealth redistribution mechanisms. They want to use the fallout of any apparent mechanism shutdown as swag within billionaire soundbite circles. The ultimate tool is a flamethrower, or something similar. It's all a flex!
Sycophants, cronies, and useful idiots will be doing shout outs on handouts, commies, vox populi, failures, freaks, basket cases, lay offs, recessions, leftists, parasites, leaners, blah, blah, blah -- weird ass rich people lickboot enshittifications.
They are trying to squeeze as much money out of their platforms as possible, regardless of the fact that it's at the expense of users and will downgrade users experiences.
Honestly they do it so consistently that i'm starting to wonder if they have a choice.
A common way to do things for tech startups is that they get venture capital funds, use them to run the business at a loss hoping to acquire market dominance, and then use market dominance to turn a profit. I think a lot of tech startups that we know are currently in phase 2, meaning they've thrown money out the window for years and are now trying to recoup their investments.
Also, Reddit wants to go public and Twitter already is. This is relevant because investors are animals, all they see is short-term profit, and they use their voting power to make the company behave that way.
There's a common thread between both my theories: it's shareholder capitalism. I say this as a lifelong shareholder myself, shareholders ruin everything.
Can't fight the class war if they have us either fighting the culture war, or not talking to each other intelligently.
Probably enshitification!
Look it up.
I hate that word. Crapification or Shitification would have done fine
I think they always need one company that people will forgive anything to normalize a practice and then everyone will start doing it. There was Twitter killing their API in all but name: Twitter still alive -> we can do that too without dying. Apple stopped including chargers and charges people extra if they actually want to use fast charging: People still buy iPhones -> we can do that too. This is like reverse competition. Someone will check how far they can push things and everyone else follows suit.
Watching businesses operate in the "how much can we get away with because the average capitalist consumer is either lazy, an idiot, or both" realm has been incredibly depressing.
Lemmy is the first time I think I've ever seen a significant amount of people actually fight back and abandon a shit product.
Well, usually they're not making a change like this. You can add all kinds of transactions, you can have dark patterns, you can mistreat your workers, but the moment you do something that directly affects the basic experience that the user is there for, you open yourself up to competition.
Google Chrome is seeing users migrate to Firefox to keep adblock, the Battlefield series is seeing users switch to BattleBit Remastered (an indie game made by literally 3-4 people, which now has nearly 7x the players as Battlefield 2042 on Steam), Call of Duty has xDefiant advertising itself based on longtime CoD player complaints, Minecraft pissed off some members of its modding community enough that they decided to make their own game called Hytale with a focus on modding and custom games (and this got picked up by Riot Games, so there's real potential here), and now we've got a bunch of people abandoning reddit because Steve Huffman decided it was a good idea to take away all the good reddit clients and mod tools without improving the official stuff first.
Don't fuck with the core experience.
Enshittification and the raising of interest rates.
These are old era internet companies from when it was considered fiscally fine to be unprofitable as long as you were growing. Those days of the internet are over and the last few companies clinging to that model now have to plan their shift toward either profitability or being sold off for parts.
capitalism — they want more money
Of course they do. But whether these changes actually lead to that is far from sure. The conviction with that the CEOs enforce these changes indicates some strong belief in some story line that’s only vaguely coupled with the promise for more money.
The tech markets have tightened.
To take Reddit’s case: so far, they could raise money at increasing valuation, and that’s how they’d fund their operations without having to have solid monetization. Now that all valuations are down including theirs, they can’t raise anything anymore, leaving them with four (non-exclusive) choices: running out of money soon and closing shop, exiting as fast as possible to get capital injection that way, letting go of most of their staff quickly in order to get leaner, or finding aggressive ways to monetize shortly.
I think Reddit’s monetization situation was grim enough that they’re making precipitated moves towards all the last 3 options, in order not to pick option 1 and die soon. For having been a part of it, a startup looking to exit will choose some very specific metrics that they’re choosing to market their exit on, and then they’ll make all their subsequent moves based on ruthlessly optimizing for those metrics alone. Since those metrics can be way different from the ones the company was using to raise money so far, that by itself can turn a company’s ethos on its head.
I think that’s what we’re seeing across the board in tech companies; except Twitter, which was a rare case of being driven by political calendar, and one person’s political goals. The acquisition agreement was signed just before the markets tightened, and in fact, Musk tried hard to wiggle himself out of it when the market started tightening, because that kind of wasteful ownership doesn’t make sense in the new climate. But this is really specific, and I believe the timing is a coincidence; unlike all the other ones.
Dr. Capitalism, or How I listened to stop worrying and love the dollar.
In the case of reddit, I've heard a theory that the company's planning to go public, and so the API changes were designed to make the platform look more appealing to shareholders (no more 3rd party apps blocking ad revenue).
It does always seem to be about making as much money as possible with a direct focus on the short term.
I'm wondering if it's a domino effect. Now that one major company made an announcement that fucks over their users, they're all doing it. We even now have YouTube cracking down on Adblockers. The Golden Era is coming to an end imo
This basically. Companies see that others can do it without consequences and so they do too. The age of acting like your "friend" is over and they are gonna squeeze ever last cent they can from users. Twitter, Reddit , YouTube, discord. I expect to see smaller players doing the same soon.
We must persevere.
As always, $$$
They want money. Capitalism strives to constantly grow.
Deleted.
$$$
Because they want people to be aware of open source alternatives but they don't want to say it directly. Poor companies 😕
Money. It really is that simple.
Reddit wanted to kill third party apps because they have ad blocking features and don't show unwarranted sponsored posts. Reddit wants to serve users as much ads and sponsored content as possible, which was not really able to happen with third party apps.
I think it had more to do with tech companies using their API heavily to train their language models. Getting users over to their app is just a bonus, probably.
Greed and monopoly, they have the power to do whatever they want since there is not many competition in their business field.
The companies want to make more money, and they have (what they think) a captive audience that will put up with the increase in costs. Pull off the bandaid all at once to maximize the probability that everyone will shrug and take it.
When a company goes public it becomes something that needs to “appeal to the public”. It’s like when a movie wants to appeal to everyone. By doing so it ends up appealing to no one in particular and it’s a successful meh movie.
Going public then you have a committee of board members making decisions. And who’s going to be on a board? Bunch of rich people who only care about making it the best company for the public. Effectively ditching everything that makes a company risky or unique.
Going public can also be good cos you’ll have public money to invest in new and better tech or systems or acquisitions. So the future they have in mind seem to not include a lot of us. It’s a direction that’ll strip anything unique about reddit and become a successful meh platform
It's a more direct path: going public means they want money. Money, profit, and as much as they can get. That means ads, subscriptions, ads, tracking, ads, data gathering, ads, and the best: get back to work you unpaid
peasantsmods.
I have a theory that the advancement of AI as demonstrated by the likes of chatGPT is gradually assimilating the data corpuses of big social media companies and using it to train bigger and better models. The social media sites are being eaten alive.
So it is only natural that Reddit would want to ban API access or make it incredibly expensive. This defense prevents outsiders from extracting their valuable data.
But there is a bigger issue that makes this problem existential not only for the likes of twitter and reddit etc. Eventually, there will be no clear distinction between a human user and an AI agent, it is already possible to instruct an agent to browse the internet and carry out actions on behalf of a user. If this process is scaled up then it becomes a de facto programmable interface to the application.
When this happens the remaining users will be forced to pay for continued access because they will have no way to verify that they are human and no way to prove that the text they are reading is not going to be used to train large language models. The business model that fueled Reddit for so many years (unpaid content creators and moderators) will fade away and the site will autocannibalise.
Interest rates had been historically low for a long time. Loans were cheap and venture capital was flowing freely. Tech companies could focus more on growing their market share with lots and lots of runway before they needed to become profitable.
Then during the pandemic, Congress gave a massive bailout to businesses. Inflation went skyrocketing, and the Fed had to raise interest rates to limit the damage.
Now money isn't flowing nearly as freely for tech companies. Loans are more expensive, and investors are more content to leave their money in high-yield bonds instead. Tech companies are pivoting to stop chasing market share and instead start taking their profits from their current market share, even if it means their market share stops growing.
This is a take I haven't seen yet, but I think it's spot on. A lot of businesses grew unsustainably because of cheap loans being available for so long. We're going to see a lot of companies and services get worse or crash and burn.
Ultimately a for-profit social platform can only make money via advertising. If you are depending on advertisers to be profitable you become beholden to those advertisers. Advertisers do not care about "community," "sustainability," or what made the platform attractive to users in the first place. But they do care about "public perception," and "number of users," and most importantly number of impressions per user, per hour. The advertisers customers care about things that hurt their branch, so they dont' want NSFW content, they don't want violent content, they don't want controversial content, they don't want anti-capitalist content, they want "quality" impressions.
So if you are twitter or reddit, or facebook, or whatever, if your advertisers make a demand that will piss off your users and make it worse for them you will always do it and you will continue to do it until the platform dies.
Have you heard of the story of the Geese that laid Golden Eggs? Yes, it's the same story here.
Both Reddit and Twitter are losing a lot money. They want to squeeze their users for profit.
Check out Cory Doctorow's post on a term he coined called enshittification. Good primer to some of the same patterns we are seeing.
I believe there is another comment that breaks down a supposition for Reddit's enshittificationw, too, in this thread.
Greed.
Regarding Twitter, Elon seems to like trial and error, right? That's how SpaceX developed their rockets - by trying new things and testing them frequently, to see if they work.
So with Twitter I think he's just trying to see what he can get away with. And if he can't get away with something then he'll just roll it back.
As for Reddit, I guess they saw Twitter trying to squeeze more money from their platform and thought "let's try that too".
Twitter had experimented and had a fair system in place through previous trial and error. Elon thought it wasn't good enough and then ran into the wall face-first thinking he was smarter than the average guy. Spoiler: he wasn't.
The other issue to consider is MBAs. Or at least the MBA way of thinking, that "caring about customers" actually means "leaving money on the table." The relentless search for "business efficiency," evaluated in pure accounting terms, can easily lead to destroying the core business due to a lack of understanding of how the core business shows up on a P&L statement.
Any company with a MBA at the helm always seem to make poor choices. Look at the all the companies that have started switching back to engineers for leadership they've started making comebacks.
And I don't mean to imply that spez (what's his name, Huffman?) and Musk are MBAs. That's why I added, or at least the MBA way of thinking. They definitely believe that expenses are a problem, rather than, you know, the flip side of revenues.
This isn't to say that you shouldn't make a business more efficient, but rather, you have to understand what's actually inefficient. You only get that understanding from being in the thick of it, not gazing from afar with spreadsheets and reports.
Cash money
Yea it goes lol this:
- Grow a platform
- Sudden API change
- ???
- Profit
You can provide quality services only for so long. Eventually quality will get in the way of profits.
Imagine I make a new place that's free to hang out at. Everyone loves to hang out there but the bank that lent me the money for the mortgage is worried and say,"How will we make any money? Everything is free." I'll say don't worry there's plenty of money eventually. We'll figure it out. Look how many people there are.
I'm going to sell this place long before the money actually has to start rolling in like promised. It will probably get sold several times before someone is finally the chump who has to figure out how this super expensive place ever turns a profit.
That chump ruins the earth, but really we all helped
its profitable? if only the minority quits the platform, it's a net gain.
Inflation , and late stage capitalism.
Also monopoly, collusion and Intellectual Property abuse
Tbh, not sure many of us would behave differently in the same situation. Imagine you can get a billion dollars, and in exchange you need to destroy your product. Would you take the deal?
Easy. They were built on the idea of "get as many users as possible, and worry about making the profits later" and spent over a decade staying alive off of VC funding.
CAPITALISM
Money
$$$$$$$
Because they’re run by people who are convinced of their own brilliance, yet have no understanding of why people actually use their sites in the first place. They have no respect for their users because they’re either too greedy and/or think they know better than anyone else.
Corporations driven by Lobbyists
Because they are greedy and the people making the decisions don't actively use their products
The funding runs out and they have to try and monetize their users somehow. Or the tech company goes public and now they have to try and produce increasing dividends for their investors every quarter.
If I remember right, Reddit's official reason for the api pricing change was continuous scraping of content for AI training data, putting more load on the server. There's probably some truth to that. Twitter and reddit also have very large user bases, which requires more resources.
Elon Musk being in the driver's seat of twitter probably doesn't help either.
My idea is that they didn't/don't havse a choice but to try something.
They are probably running out of money and no one is giving it to them in this econimical climate.
Maybe profitability, or at least drastic measures, is the request by investors (similary how IMF is "blackmailing" countries when they give them loan).
It might also be an experiment, planned or accidental to male profit of social networks after 20 years of investing.
It is a gamble, but cut has to be made at some point.
The users are not the customer. We are the product.
Because “better” means less profit.
Great analysis.
Stupidity and greed, a great combination!
It's not necessarily greed. The infrastructure to keep Reddit alive can't be cheap. How do you pay for that? VC money has dried up so these services that have been free to users are all quickly scrambling to make money. I definitely think they did it wrong. They should have planned the API fee changes out for years instead of trying to force it in a month.
They make money by serving adds to the people providing their site content.
And no, that is not what happened. They were trying to increase their valuation for future share holders.
Edit: adding it is the only greed, that is the reason.
Rabbits
The user bubble has popped now that investors started questioning why the fuck they’ve been investing huge amounts of money into companies that make no money just because they have lots of users. With that investment money drying up, these tech companies are desperate to start making a profit so they can survive and grow their value still.
TLDR: investment in unprofitable tech companies is drying up and companies that aren’t profitable are scrambling to make money.
Rabbits
Money
Because they realize they can get away with pretty much anything.
Cory Doctorow termed it "Enshittification", and wrote about the process here: https://pluralistic.net/2023/01/21/potemkin-ai/#hey-guys
I'm glad I read through the whole thing.
Bummed that I won't be winning a testicle 😰
I'm glad I read through the whole thing.
Bummed that I won't be winning a testicle 😰
Dr. Capitalism, or How I listened to stop worrying and love the dollar.