01-01-2017, 06:04 PM
(01-01-2017, 04:32 PM)SomeGuy Wrote:Quote:Did they? How successful have new media been in getting consumers to pay for their product? Facebook, Twitter, Youtube etc. are all free to the user. By definition, their product has no value to consumers, since consumers pay nothing for it.
Come on, Mike, now you're just being willfully obtuse. GDP is just a metric, it's not the be-all and end-all of economic activity. Eyeballs have migrated from old media (newspapers, the classified section thereof, etc.) to sites like Facebook and Google because people feel that they derive more benefit from these things. These eyeballs (which can be more precisely measured, categorized, and targeted than was the case with the old media) are the real product, in turn giving more value to the advertisers who are the actual consumers. This is a business decision, and is one of the many revenue streams the new media giants have captured. If these companies follow the same progression as their old media counterparts, they will continue to find new revenue sources as these complete the transition from scrappy start-ups to mature businesses. Plenty of websites that were free when I started reading them 10-15 years ago have switched to a subscriber basis, and some of them I have been willing to shell out money for since.
Of course, some of them won't. We're in a bit of a bubble with tech companies now, and this bubble will eventually shake out in its turn. Not everyone of the services available now will last the decade. This is normal, and is not an indictment of the overall system.
You also ignore that all of these "free" sites require people to shell out for devices, internet service, data plans, electric bills, and the like, and the underlying infrastructure requires fiber optic cables, wireless networks, server farms, climate control for the same, switches and routers, the electricity to run these, all of which has to be manufactured, installed, and serviced. Lotta money being spent keeping all of this up and running. And the reason businesses and consumers are able and willing to pay for these new things is because that the price of each of these new things comes down with improvements in technology and business structure (things like economies of scale, automation, etc.)
No I am not. GDP is a measure of the economy. To really understand things you need measures. The final destination of economic output in the end consumer who pays for the economy through their purchases. A firm that offers product for free produces no value direct to the consumer. Of course they provide value to advertisers, but advertisers provide no value direct to the consumer, either. They provide value to individual firms. If a particular firm, using internet advertising (employing 10), gains business at the expense of competitors (who did not use digital advertising) so that they grow by 100 employees while the competitors shrink by 150 employees the internet firms have delivered real value to their advertising customers and they in turn have delivered real value to their customers, and the overall economy has lost 40 jobs. How one evaluates this depends on perspective. From the perspective of the businessman or investor, its a huge gain. But from the pov of the state, it's not.
As to you second point, I did not ignore that. The hardware and infrastructure of the information economy constitute the fraction of this economic that functions as a leading sector. In the late 1970's almost nobody had personal computing power at home (I did as early as 1977). There was very little reason to had such a thing then. The only folks were geeks like my dad who put in our system (using home-built terminal, TV for video and a 1960;s teletype printer (110 baud) for hard copy). When I finally got my own PC in 1983, I had tons of bootleg software, which I rarely used except for the word processor and some games. I booted up VisiCalc, starred at the screen for five minutes, said what the fuck is this good for and went back to writing BASIC programs which is what I wanted the PC for. My point is there was a wave of home hardware installation in the 1980's long before the internet. This was a classic leading sector, like cars. I shelled out $6000* for my first machine in 1983, $3500 for my second in 1987, and $1800 for my third in 1993. Note all of there were purchased before the net.
By the 1990's there was plenty of reason to have a PC, games first and foremost. Over the first decade of the information revolution in my household we were shelling out about $1000 a year on hardware and a smaller amount on software. The PC revolution was functioning a real leading sector. We were spending money on this new thing while at the same time we were spending the same on all the old stuff. During the second decade, expenditures on hardware and software declined, but there was a new thing--internet. So that means $350 a year for dial-up. Internet was totally cool, got into MUDing, hosted a MUD for a while by renting space on a server in Grand Rapids for $50 a month. In 1997 I finally put our my first webpage, which is still available on the wayback machine:
http://web.archive.org/web/2004020301504.../stock.htm. I had gotten into financial commentary as a way to wean myself off MUDing.
By around 2000 everything was free. I had all the space I wanted for nothing on the CSF server. I could upload stuff for nothing. Everything was cool. The came the tech wreck. The free stuff was withdrawn. Then came cell phones and then smart phones. These cost money, but they directly replace telephony and the old internet. The companies offering the new service grow the old ones go way. On net no real change on a per capita basis. And it shows up in the aggregate statistics, GDP growth has been subdued since 2000 and the wages of college-educated workers stopped rising around then too.
*all prices adjusted for inflation to todays values