When Companies Profit from Users' Misery

One of the employees of RealNetworks (you remember them, right? RealPlayer?) put up an article on Medium talking about what happened when the company tried to do the right thing.

One day my manager showed me a horrible graph. It was pretty simple: the graph was steady, then it dropped straight down, then after a short period, the line shot straight back up and stayed level again:

Jon's Graph

“That’s what happens when we do the right thing”, he said while pointing at the drop, “and that’s how much money we lose. We tried it just to see how bad it was for our bottom line. And this is what the data tells us.”

When you build a business, you absolutely have to think about what your revenue model is going to look like and how your users will react to it. That's why I don't feel that much of Silicon Valley is geared for anything more than short-term success - they're companies fundamentally built on giving users one thing to start out (great, free products), and then slowly shift over time into something completely different (bloated products subsisting on ad-supported revenue or worse).

It's like Yoda said, "...once you start down the dark path, forever will it dominate your destiny."