Don’t Cry for Yahoo ⇥ vanityfair.com

Maya Kosoff, Vanity Fair:

Companies like Twitter and Yahoo already get too much benefit of the doubt by virtue of being in the tech sector. At the beginning, it’s assumed these companies will be unprofitable; investors clamor to pump money into them, typically on the strength of pitch decks and founder promises. In no other industry are companies allowed to flail for so long before ultimately getting smacked down by public or private markets.

This isn’t a purely capitalistic concern for me; it’s more about user rights because of those capitalistic concerns. There are just a handful of likely end-games for an unprofitable or poorly-performing tech company: fill it with ads, sell the company, or shut it down.

These are all concerning avenues for users. Adding advertising tends to mean user privacy is compromised, as ads become increasingly targeted by the day; shutting a company down means all user data gets removed, and it’s up to each user to find a new product or service to fill the hole. Rinse and repeat.

Arguably worse is when the company and all attached user data is acquired. There’s very little control any user has over that decision: they may like the original product, but are uncomfortable with the new owner. These decisions are impossible to foresee: if you signed up for Flickr ten years ago, or Tumblr five years ago, would you be expecting your photos and blog posts to end up in the hands of Verizon today?

Twitter is another rumoured acquisition target, and one of the rumoured buyers is Google. Would you continue to use Twitter if Google purchased it and your tweets become part of your Google advertising profile?

This income inequality problem is significant for the scale at which tech companies operate. On the one hand, there are tiny companies that don’t have a business model and can barely sustain themselves. On the other hand, there are massive whale-like companies that suck up the startup krill for their data, intellectual property, and engineering talent. And that means that the technology landscape becomes increasingly dominated by a few very large players.