[phpisthebest]

>>I don't think this is because of the "end of cheap money"

Explain just about all platforms doing revenue adjusting user hostile actions then? Examples include Reddit with the API fees, YT with the Ad Blocking blocking. etc

This is all a reaction to the end of cheap money, aka the cost of capital is going up, so companies need to actually make revenue instead of chasing free capital

>>I don't think this high interest rate environment will last that long

There is no indication this true, most likely the "new normal" is going to be on the order of rates before the 2008 housing crash, not going back to the insanity of 0-1% fed rates...

[partiallypro]

Reddit over hired and is doing other stupid pricing models because they want to IPO, they filed confidential paperwork for an IPO last year. Twitter has been unprofitable since before Musk, and Musk's actions drove their revenue into the ground. Those aren't related to higher interest rates. What other examples do you have? Reddit and Twitter are bad examples.

> There is no indication this true, most likely the "new normal" is going to be on the order of rates before the 2008 housing crash, not going back to the insanity of 0-1% fed rates...

There's no indication that your statement is true either, I think in a 5-10 year span we'll have lower rates simply because virtually every economy is in population decline. In any case, the Twitter and Reddit flubs weren't due to higher interest rates. SVB was, this isn't.

[mlyle]

They're not perfect examples. But what they're saying is:

* High returns from interest means the cost of capital is higher. Comparable safe investments return more, so investors demand more of a return from a riskier one.

* As a result, a lot fewer venture investments make sense with the higher discount rate.

* Companies cannot count on going back to the venture till, so high volatility strategies of chase-IPO-now or monetize-now are increasingly employed.

* Similarly, public companies desperately seek better fundamentals now, because future revenues are discounted so much in investors' opinions.

* As a result, a lot of companies enshittify, going after short term wins that risk the entire company's reputation..

As to the interest rate environment: the Fed has suggested a couple more interest rate hikes are likely later this year. It is likely to take quite awhile to walk rates down after inflationary pressures reduce. Current market prices imply rates will stay relatively high for the next few years.

No one really knows what an aging, contracting population will do to the interest rate environment. It's likely governments will have to borrow a bunch more, which can push up rates... And older workers seem to be more productive than models expected, which adds further upward rate pressure.

[troupo]

> Explain just about all platforms doing revenue adjusting user hostile actions then? Examples include Reddit with the API fees

Bad example. Reddit actions (and Twitter actions) are definitely not due any user hostile actions.

> YT with the Ad Blocking blocking.

This one may be has some merit to it, but we only have Google's word for it, and Google itself doesn't seem to be hurting because of all the bad-no-good ad blocking. Is Youtube hurting? No idea.

[phpisthebest]

>Bad example. Reddit actions (and Twitter actions) are definitely not due any user hostile actions.

The actions are hostile to the users.. Twitter, Reddit, and YT (and others) have changed policies in a way to maximum revenue at the expensive of the users of the platforms.

[gmerc]

It’s price perception shaping. Hey investors look how much we are charging for APIs, that’s how valuable our data is. Can I haz some money

[berkes]

If it truly is "the end of cheap money" (which I believe is the root cause) we can clearly see which management is competent, and which just flailing aimlessly.

"When the tide goes out, you see who's been swimming naked."