I mean there’s Reddit ofc, as well as Twitter in its entirety, Discord is implementing some dumb updates, there are issues with Tumblr as well as everything to do with Meta, and I’m sure there are plenty more (and I haven’t even touched other digital media, for example the Sims). Why is it all happening in the span of about a couple months?
Lets take the example of Reddit. Reddit could have kept its costs to the minimum and could have run the site with the ad revenue that came in. In fact they could have talked transparently about their opex and asked for a simple donation drive every now and then like Wikipedia. If need be, they could have removed silly GIF replies and other stuff and focused on text alone. However this would not let them become the next Facebook. That’s what they wanted to be. At some point in their story was a choice to be forums 2.0 or get into a race to become a cash grab. Sadly they went for the latter.
n fact they could have talked transparently about their opex and asked for a simple donation drive every now and then like Wikipedia.
Let’s remember this about Kbin and the Fediverse.
I would donate to help counterbalance the wave of migration that brought me here.
Late stage capitalism You make a business and it goes well, you make some money everyone is happy.
But with time your profits will plateau or even decline. It’s natural, but businesses don’t understand that it is insane to expect a company to always turn crazy profits when the product does not evolve.
Companies like apple and Microsoft don’t worry as much because they are constantly evolving with new product.
Companies like Twitter, Facebook, reddit, Netflix have hit a wall where there really isn’t anywhere else to go so they start making shareholder centered decisions made by people who aren’t even in touch with the user base of their product.
It’s the money.
US Fed has raised interest rates, destroying money for the first time in decades in an effort to stop our inflation problem
The knock on effects is that banks literally have less money to lend to companies. Some companies are affected more than others by this environment. Tech was hit hard, extremely hard.
With hundreds of thousands of layoffs, tech industry is contracting. Silicon Valley bank literally evaporated in the span of 3 days. Twitter was losing money and had to sell out. StackOverflow is losing money and is currently selling out.
In this environment, Reddit is about to launch it’s long awaited IPO, the time when the public is allowed to directly buy Reddit stock and invest into the company. That’s what Initial Public Offering means. If Reddit does well, Reddit will pull in lots of money this year through this IPO.
The CEO of Reddit needs to prove Reddit is profitable, or if not profitable… Will eventually be profitable. Stockholders don’t care about Reddit drama for the most part, but most are smart enough to read financial sheets. Reddit needs to show growing revenue, growing profits and cutting costs to attract money.
As such, all of what Reddit’s CEO has done makes sense in the context of the IPO. He is betting that shareholders won’t notice the drop of high quality content creators from Reddit, since that’s not a financial number that’s reported. He can IPO, raising millions, maybe even billions for himself. The golden parachute outta here when everything gets screwed up in a year or two and collapses.
I think today’s investors are smarter though, and the bearish economy and high interest rates means more investors will pay attention to underlying issues.
Generally the drama isn’t a big deal. But in a specific case the only value of the site is in the community moderation and the depth of data on the site.
He needs investors to buy in but he also needs advertisers to buy in. Advertisers do not love paying for negative drama.
U just enlightened me sir. Thank you.
Yeah, investors are going to be even more inclined to identify exactly why the platform might be successful in the future. They’re not going to blindly throw money at new IPOs (as much) because debt isn’t free anymore.
Running out of VC dollars, now they gotta actually make a profit.
$
I think the free money train in leaving the station and everyone is scrambling to be profitable. But that’s just an assumption based on twitch and Reddit right now.
Start making alternatives, open source alternatives.
Silicon Valley Bank collapsing is putting pressure on tech companies to actually turn a profit, so they’re turning to slimy tactics just to survive IPO
Because easy money from a decade of low interest rates is disappearing.
Higher interest rates means they have more pressure to start being profitable is my guess.
@VoidCrow Everywhere you look you see overpaid executives and CEO’s who think they are actually brilliant enough to deserve their astronomical wages/compensation, and thus think they can do no wrong. Their ideas are always brilliant, and when the shit hits the fan, they blame their staff for a bad implementation and fire them first.
A lot of technological flux going on right now, what with an entire generation partially trained to do WFH and job mobility that brings, the retirement of the tech-phobic boomers, the extremely tight labor market, Russian money going to “more important endevors” (which might also be why bit coin is down), and AI threatening to automate 80% of the workforce. Tech company owners are frightened and making random dumb or scared decisions because of it.
What were the bad decisions discord is making? Im out of the loop
Because of capitalism, no seriously these decisions are based on money and growth. But both of these things are relatively finite. You can’t keep have exponential growth year after year. Eventually you will plateau but there isnt a mechanism in capitalism to accept that. So companies start forcing monetary gain.
Growth for the sake of growth is the ideology of cancer.
And like cancer, it will eventually kill its host once things are beyond saving.
