Derek Powazek has worked the web since 1995 and is the founder and CEO of Cute-Fight, the online game for real-life pets. He's the author of "Design for Community" and creator of Fray. This essay was originally published on his site, republished here with permission.
“If you’re not paying for the product, you are the product.”
I don’t know who said it first, but the line has achieved a kind of supernatural resonance online. And for good reason – it describes a kind of modern internet company that provides a free service. These businesses are designed to aggregate a large number of users in order to sell that audience’s aggregate attention, usually in the form of advertising.
But the more the line is repeated, the more it gets on my nerves. It has a stoner-like quality to it (“Have you ever looked at your hands? I mean really looked at your hands?”). It reminds me of McLuhan’s “the medium is the message,” a phrase that is seemingly deep but collapses into pointlessness the moment you think about using it in any practical way.
There are several subtextual assumptions present in “you are the product” I think are dangerous or just plain wrong that I’m going to attempt to tease out here. Many of these thoughts have been triggered by Instagram’s recent cluelessness, but they’re not limited to that. I also want to be clear that I’m not arguing that everything should be free or that we shouldn’t examine the business plans of the services we consume. Mostly I’m just trying to bring some scrutiny to this over-used truism.
Assumption: This is new or unique to the internet.
Free, ad-supported media has been around for a long, long time. When I was in college, before the web existed, I worked on alternative newspapers. Not only were they free, we actually walked around campus thrusting them in people’s faces.
I guess you could call the people we gave them to “the product,” but it sure didn’t feel that way when I was driving my VW Bug over Highway 17 filled to the roof with newsprint. The product was the thing I broke my back creating and hauling around.
Online ad-supported media is no different. It’s free, it builds an audience, and then it sells access to that audience in small chunks to companies willing to pay. There are ways to do that while still maintaining respect for the consumers. We’ve been doing it for years.
Assumption: Not paying means not complaining.
The “you are the product” line is most often repeated when a company that provides a free service does something that people don’t like. See Instagram’s recent terms change or any Facebook design update. The subtext is, this company does not serve you, you don’t pay for it, so shut up already.
But that’s crazy talk. If a company shows that they’re not treating you or your work with respect, vote with your feet. Uninstall. Delete account. Walk! And make sure they know why you split. It’s the only way we have to make companies feel the repercussions of dumb, user-hostile decisions.
Assumption: You’re either the product or the customer.
I’ve worked for, and even run, many companies in the last 20 years with various business models. Some provided something free in an attempt to build an audience large enough to sell advertising, some charged customers directly, and some did a combination of both. All treated their users with varying levels of respect. There was no correlation between how much money users paid and how well they were treated.
For example, at JPG Magazine we sold something to our audience (magazines, subscriptions, and ultimately other digital services) and we also sold ads and sponsorships (online and in print). We made it 100% clear to our members that their photos always belonged to them, and we had strict rules for what advertisers could do in the magazine. We also paid our members for the privilege of including their photos in the printed magazine (as opposed to Instagram’s new policy that they can use your photos however they want, even in ads, without paying you a dime).
This example is much more complicated than the black and white “you’re the product” logic allows. In some cases, users got the service for free. In others, they paid us to get the magazine. In still others, we paid them! So who/what is the product?
And just because you pay doesn’t mean you’re not the product. Cable TV companies take our money and sell us to the channels, magazines take our money and still sell ads, banks and credit cards charge us money for the service of having our money. Any store that has a “loyalty card” takes our money for products but gives us a discount in exchange for the ability to monitor what we buy. In the real world, we routinely become “the product” even when we’re already paying.
Assumption: Companies you pay treat you better.
I should be able to answer this with one word: AT&T. Or: Comcast. Or: Wells Fargo. Or: the government.
We all routinely pay companies that treat us like shit. In fact, I’d argue that, in general, online companies that I do not pay have far better customer policies and support than the companies I do pay.
The other day I had a problem with my Tumblr account. I sent an email. In less than an hour I had a kind, thorough, helpful response from a member of their support team. Issue fixed.
The next day I had a problem with my internet connection. I called my provider. After listening to hold music for a long while, I got someone on the phone who obviously spoke English as a second language, was not allowed to deviate from their script, and had less experience with the product than I did. They did not fix the problem. I was told to wait until it fixed itself.
The difference between Tumblr and my ISP? I pay my ISP over $50 a month. I pay Tumblr nothing.
Thinking critically about the business models of the services you use is a good thing. But assuming that because you pay means that things will be better is a very bad idea.
Assumption: So startups should all charge their users.
The apex of this argument is Maciej Ceglowski’s Don’t be a free user essay, in which he advocates that people “yell at the developers” of sites that don’t charge money.
Look, I’m thrilled that Pinboard has been a financial success for Maciej. I’m a paying member! And he’s right that it’d be nice if more companies could turn their users into customers that support the business.
But not all businesses can be run that way. Entertainment and media companies are rarely able to charge their consumers for their product. My company, Cute-Fight is a fun game, but I couldn’t throw up a brick wall on the homepage and expect it to succeed as Pinboard does. It’s just not that kind of business.
This blind “my way is the only right way” is a poison to innovation and destructive to those of us building free services that do have business plans. Some businesses require mass adoption to work because they depend on economies of scale or a large audience. There is nothing inherently wrong with that.
What’s inherently wrong is a company changing its terms of service to screw their users. What’s wrong is a company that sells your data without your consent. What’s wrong is a company that scales back customer service to save a buck, leaving its customers angry and frustrated.
But those things usually have nothing to do with whether you’re paying them or not. They have to do with the company’s leadership, their level of complacency, and their demonstrated respect for their customers.
We can and should support the companies we love with our money. Companies can and should have balanced streams of income so that they’re not solely dependent on just one. We all should consider the business models of the companies we trust with our data.
But we should not assume that, just because we pay a company they’ll treat us better, or that if we’re not paying that the company is allowed to treat us like shit. Reality is just more complicated than that. What matters is how companies demonstrate their respect for their customers. We should hold their feet to the fire when they demonstrate a lack of respect.
And we should all stop saying, “if you’re not paying for the product, you are the product,” because it doesn’t really mean anything, it excuses the behavior of bad companies, and it makes you sound kind of like a stoner looking at their hand for the first time.
In a followup post, the author suggested a corollary: