this post was submitted on 25 Nov 2023
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yeah I remember when Netflix first started circa 2007,
IT COST $8 A MONTH
I was there for it. They would mail out DVDs and there were no due dates or overdue fees. You just drop it back in the mail when you're done watching it and then you can rent more DVDs. The whole thing cost $8 a month.
that was the beginning of Blockbuster video going out of business. Blockbuster's late fees and rewinding fees were an atrocity.
Here's the thing. Even with inflation (which is exaggerated by companies when they jack up prices for consumers), they have less overhead now than they did when they started. They had to do all the DVD stuff by hand and now it's all computers. So basically they just had a massive bump in their profit margins and just pocketed the difference.
Surprise surprise, better technology and automation replacing people doesn't mean things become cheaper under capitalism, even when it fucking should.
People always underestimate the work power needed to keep automated things running. And even more to set them up in the first place.
Many things that look like fully automated still have people in the loop.
Yeah as a programmer it seems that everyone around me underestimate by several magnitudes the amount of money and effort that goes into something like the Netflix infrastructure. It's extremely frustrating because people always look at you with distrust when you say how much work it will take to develop a website. As a rule of thumb, the site's apparent simplicity (for the end user) is correlated with the effort you put in.
That said, Netflix already had its infrastructure in place back when they had reasonable pricing. The recent greediness doesn't reflect their costs suddenly going up, it's just exponentially growing demand for profit and investors who want to cash in.
Disruptive technology doesn’t follow cost covering logic though. Covering costs is hardly interesting for investors. Netflix ran at loss to grow quickly and cement the market share.
Recent enshittification occurs because the market came to an understanding that the fight for the market share is over and now it’s time to satisfy investors.
But several things can be true at the same thing time. Infrastructure is expensive and investors want to maximize return of investment.
They had rewinding fees on DVDs??
No. Blockbuster was still stuck on VHS tapes.