I think the comment is saying exactly that "we" need to have regulation that sets the correct priorities, because a profit-motivated business/market cannot do so itself. The tendency to trade off the common good for individual short term gain is explained by game theory.
That's how I took it too. For this to work, the penalties would have to be large enough to make the harmful actions unprofitable for the company (and its executives). Usually, fines given out by government regulators (who are sometimes people who used to work for the industry or will in the future) are small enough to be considered part of the cost of doing business.
For instance, in 2009 Pfizer was fined $2.3B for promoting off-label use of a few drugs and paying kickbacks to health care providers to push them. That year they reported $50B in revenues, so the largest health care settlement in history (at the time) probably didn't even put them in the red.
If fines for law-breaking by corporations were large enough to bankrupt the company, and if executives did prison time as well, that would be an actual incentive to obey the laws.
Want another rich one? After acquiring HCA in 1994, Rick Scott was CEO of the company while it systematically defrauded the US government by overcharging Medicaid and various other schemes. In settlements reached in 2000 and 2002, Columbia/HCA pleaded guilty to 14 felonies and agreed to a $600+ million fine, which was the largest health care fraud settlement in U.S. history at the time.
In 2018 Rick Scott was elected as a US Senator for Florida and now serves on the budget committee. That is, CEO responsible for a huge theft of taxpayer money is now in charge of how all the taxes are spent.
But they use their "free speech" in the form of money to lobby and set the agenda for any such regulations. Citizens and public institutions cant possibly compete with that
> a profit-motivated business/market cannot do so itself
I think this is incredibly short sighted and not the case at all.
(Not you, but companies that think this way.)
Facebook started out doing something great and free. People loved it.
They couldn't stay all free, but if they had aimed at continuing to enable people, while maintaining their privacy (from third parties, and themselves), they could have been a platform of tremendous creativity and productivity. With an entire sub-economy of trustworthy paid networked upgrades and services.
The social network has tremendous value, with high value opportunities in every direction.
But instead of looking out for the users, they went with surveillance, manipulation and slop (Political, social, AI, ... slop.) And now 99.99% of what their servers do is that.
So today, yes, their survival is completely dependent on digging deeper. But they had a choice. Now they don't.
On the one hand, they would take a catastrophic capitalization plunge if they discovered ethics. On the other hand, they have become global experts at hyper-scaling and leveraging conflicts of interest, and dodging any meaningful repercussions.
I agree that Facebook could have continued to become something better, and the failure to do so is a direct result of Zuck's own personal flaws and failures and the culture he spawned.
And, they were especially insulted from competitive threats thanks to the huge advantage of network effects!
But businesses are always going to fuck up and have flawed leaders! And I think that was the general point. Social media has turned out to be a major educational moment for society in a lot of regards.
What makes you so confident that this alternate path is actually real and as good as you describe it? You say that the additional market coverage they would've gotten by not being abusive could've easily made up for the profit that they otherwise would've lost, but what makes you think that? The thing here is that any of these megacorporations has hundreds of people dedicated solely to exploring every conceivable strategy they have to making as much money as possible. So why hasn't even one of them from any company thought of what you said? And why did no one try?
Can you name one gigantic, publicly-traded company that made a choice similar to what you described and reaped the rewards on that scale?
The fact that these services need to be not just profitable, but also sustain indefinite growth makes them desperate. All of them start squeezing their customers for cash, be it directly (predatory pricing, subscription services, segmenting their services, raising prices) or indirectly (selling user data, integrating everything they know into their ad services, using harmful techniques to maximize engagement). Personal attitudes just dictate whether it happens earlier or later, but they all will have to do it.
Tech companies seem to have converged on the idea that providing a compromised, but free service is usually superior to anything paid. And it seems to have paid off, Facebook has billions of users to this day. Most people don't care or don't like to think about it. The fix for this would need to be systemic.
> the additional market coverage they would've gotten by not being abusive could've easily made up for the profit that they otherwise would've lost
I don't think anything would have been easy.
But I do think that if you want to be more than a one trick pony, as Meta desperately does, the best bet is leaning into creating value. Getting better and better at that. From whatever unique position you start with.
There is more potential value to create than extract.
Watching Zuck's VR and AI initiatives. It is clear he hasn't a clue, has no unique insights, into what would be useful or non-trivially engaging.
His big vision is to create bigger milking machines. Even before creating something worthy of being milked. Even for a predator, that puts the cart before the hyena.
