Headline of the Day

Tech’s Broken Promises: Streaming Is Now Just as Expensive and Confusing as Cable. Ubers Cost as Much as Taxis. And the Cloud Is No Longer Cheap.

—Business Insider

They seem to think that this was not how it was supposed to turn out.

This was the plan all along.

Use massive infusions of venture capital to take over markets through predatory pricing, and by the time that reality hits SoftBank and Masayoshi Son have already cashed out.

Not only is it criminal anti-competitive behavior, it is pump and done fraud:

Sooner or later, everything old is new again.

We may be at this point in tech, where supposedly revolutionary products are becoming eerily similar to the previous offerings they were supposed to beat.

Take video streaming. In search of better profitability, Netflix, Disney, and other providers have been raising prices. The various bundles are now as annoyingly confusing as cable, and they cost basically the same. Somehow, we're also paying to watch ads. How did that happen?

………


Streaming was supposed to be better and cheaper. I'm not sure that's the case anymore. This NFL season, as in previous years, I'll record games on OTA linear TV using a TiVo box from about 2014. I'll watch hours of action every weekend free, and I'll watch no ads. Streaming can't match that.

You can still stream without ads, but the cost of this is getting so high and the bundling is so complex that it's getting as bad as cable — the technology that streaming was supposed to radically improve upon.

………


A similar shift is happening in ride-hailing. Uber has been on a quest to become profitable, and it achieved that, based on one measure, in the most recent quarter. Lyft is desperately trying to keep up. How are they doing this? Raising prices is one way.

Wired's editor at large, Steven Levy, recently took a 2.95-mile Uber ride from downtown New York City to the West Side to meet Uber CEO Dara Khosrowshahi. When asked to estimate the cost of the ride, Khosrowshahi put it at $20. That turned out to be less than half the actual price of $51.69, including a tip for the driver.

………

Finally, there's the cloud, which has promised cheaper and more secure computing for companies. There are massive benefits from flexibility here: You can switch your rented computing power on and off quickly, depending on your needs. That's a real advance.

The other main benefits — price and security — have been looking shakier lately.

………

As a fast-growing startup, Snap bought into the cloud and decided not to build its own infrastructure. In the roughly five years since going public, the company has spent about $3 billion on cloud services from Google and AWS. These costs have been the second-biggest expense at Snap, behind employees. 

There is a technical term for this, enshittification.

For at least the past decade venture capitalism's model has been little different from a bucket shop.

If we actually enforced the laws against fraud, both Andreessen and Horowitz would be in jail.