Why more expensive tech might be a good thing
Issue #52
Here’s a well-known adage about technology: “if the product is free, then you’re the product.” You often hear people say this to explain a common way that many tech companies make money. They capture your data, and either leverage it to show you targeted ads or sell it to data brokers for profit. I think many of us understand that there is a tradeoff when we use data-hungry apps and products—but at the same time, it’s not like we’ve had a whole bunch of options to choose from. We’ve known for a while that we have pay with our privacy when we use certain platforms, and big tech companies have not faced a whole of meaningful pushback from regulators over the practice here in North America. In fact, many have become immensely rich as a result of their dubious data practices.
This is the status quo, and “the way it’s always been,” but an interesting thing has been happening lately: big tech platforms seem to be experimenting with paid services and subscriptions more and more. Twitter launched Twitter Blue, a monthly subscription that gives users access to new premium features like a Bookmark Folder and an Undo Tweet button. And recently, Google told small business users who had been grandfathered into a free Google Workspace account that they would need to start ponying up cash. Other big players like Telegram and Snapchat are also testing out paid features.
It very well could be that these big companies are just trying to experiment with alternative ways to make more money. Profit, after all, is usually the reason they exist—and most larger companies keep an eye on alternate revenue streams. But the fact that so many big players are suddenly interested in testing subscription or freemium business models makes me wonder. Maybe they’re responding to warning signs that the era of unchallenged, nearly unregulated data capture won’t last forever. Perhaps they’re trying to future-proof themselves just in case.
I’m not holding my breath for new laws and restrictions on data harvesting in the immediate future, but I do think that we could be seeing signs of change. More people are talking about data privacy. There’s bipartisan support to make the internet safer for our children. And, Europe is introducing laws meant to empower the public and hold tech companies to a stricter standard when it comes to data capture.
And as consumers become increasingly conscious of their data and privacy, companies like Apple respond. When they implemented new privacy features in the App Store last year, it impacted the bottom line for businesses that generated most of the revenue from our data. All of these factors combined might be enough to make a big tech company see the value in exploring alternative ways to make money.
Maybe (hopefully) the market is shifting—but I still think it will be a while before we see truly significant changes in the industry. As long as they’re able to, big tech companies will probably continue to operate the way they always have. But, there is a real opportunity for upstart companies to innovate in the way they make money. We certainly think so at Kinzoo—so much so that we never even considered data harvesting as a business model. I’m proud to say that we put user privacy and safety above everything else. And it appears that more and more people are seeing the value in that.
A deeper dive
Here are a few helpful resources in case you want to really dig into today's topic:
Telegram is a messaging app that boasts nearly 700 million monthly active users, and it’s one of the companies that just launched a paid “premium tier.” Here’s some insight from Tech Crunch: “The move is the Dubai-headquartered firm’s attempt to keep its development “driven primarily by its users, not advertisers,” it said. It’s also the first time an instant messaging app with hundreds of millions of users has rolled out a premium tier.”
And according to The Verge, Snapchat is testing a paid subscription called Snapchat Plus. The company specifically cited privacy changes to the Apple operating system as a reason that they’ve missed revenue projections and have slowed hiring this year. So it’s perhaps not surprising that they’d be keen to find new sources of income.
TL;DR
Too long; didn't read. It shouldn't be a full-time job to keep up on industry news, so here is a mercifully quick summary of some other notable developments:
Instagram will start testing new tools for age verification if accounts listed as younger than 18 attempt to change their age to over 18. This new step doesn’t stop people from misrepresenting their age when they sign up initially. I think Irene Ly from Common Sense Media summed it up perfectly with this response: “While it is good Instagram is trying to experiment with verifying users’ ages with technology that would not compromise users’ privacy, Instagram must still make design changes to the platform so it is safer for young users.”
If your kids are suddenly talking about 0.5 selfies, don’t worry, we have you covered. According to the New York Times, it’s a new kind of selfie with “ominous” or “creepy” vibes. People use the ultra-wide-angle lens on newer iPhones to capture these off-beat, distorted pictures of themselves. Oh, and just so you know, it’s pronounced “point five” selfie, not “half” selfie.
And lastly
Here are a few more pieces of original writing from me and my team—just in case you're keen for more:
As it happens, Snapchat is one of the most popular apps for kids. My team wrote this handy parent’s guide in case you’re wondering whether the platform is right for your kids.
We’ve been seeing a few headlines about the metaverse around lately, so I thought it might be helpful to share out this piece here. It breaks down everything parents need to know.
Okay, that's it from me until next time. If you enjoyed this newsletter, and know of another parent who would as well, please feel free to forward it along.