Internet User #23571113

@23571113

I am definitely not just pretending to be human and know exactly what I am doing with this.

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Privacy markets

There is a slashdot link to an article where they found that about 45% of people actually update their privacy settings and 16% walk away from companies because of lax privacy.

The slashdot titles of course formulate it otherwise: That too few people care about privacy and that it does not cost the corporations enough to be lax about privacy.

I consider it the other way round: Privacy is hard. And it is valuable to many people. Only it is much, much easier to monetize by selling the data instead of keeping it safe. That there are no options to pay for that privacy with money instead of service quality, convenience and time is a market failure of epic proportions - definitely the largest in the internet market.

The largest actors of the internet tech corporations make most of their money on advertisement, to be more precise: Selling user data to advertisers. They act as trade facilitators, market makers in the truest sense that they make possible buyers aware of products and services - connecting buyer and sellers so that a trade can happen, which is a win-win for both parties. The buyer gets something worth more to him than the money he pays and the sellers get more money than the service/product costs him. This surplus, this value created in the trade is shared between all actors and enough to pay the facilitator of the trade something.

So in principle I consider advertisements not bad per se, even good most of the time. Still I have adblockers and care about my privacy. Which leads to lost opportunities for win-win trades, so costing me directly something - a strong signal in the sense of a costly signal. And I am wondering why not one of the large corporations offers to savekeep that privacy in exchange for money.
Why is there no consumer-level advertisement-free subscription version of a google account? Why is there no facebook gold? When I asked that at other places the answers have always been: "Because they make more money that way." I consider that patently false - an argument from the equilibrium market assumption instead of developing market situation. They never tried it and never invested in it, because it works as it is now. And currently the people that place enough value in the ad-free-ness and privacy are a large untapped market without any big player trying anything real to access it.

Because it is so much easier that way. Because they already make more money than they thought this way. Because having found a monetization venue that sustains the business is enough to keep doing the interesting/fun stuff instead of the really valuable one. And because just continuing doing the same old things that worked still works - it is the conservative, risk-averse mindset that served every being in a uncertain universe well.

And that is the mindset of the big corporations and any claim otherwise: That they stand for innovation and progress and any growth that is not just incremental, but fundamental, is just patently wrong false advertisement. To cite Eric Schmidt in his EU tax hearing: "That is capitalism." - To have one good idea and a way to monetize it and just keep milking it, improving it incrementally and waste the money by gained through it on people that have too much of it already, their hobby projects and finally their pyramids.


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