People Chastising Steemit Inc For Selling Both Ad Space And STEEM Are Not Connecting The Dots
I vividly remember debates about the economics of Steem from way back a year or more ago. I could only shake my head at the ignorance and lack of common sense rife on here. Everybody was supposed to be a net earner. Advertising and commercial promotion were an anathema. But Steem was no Ponzi scheme, oh no. I could only laugh. Lots of people were saying stuff like that but some smart ones, too.
There's nothing like a healthy, brutal bear market to knock some sense into people's heads. When a speculative market turns south, you're going to have to generate income from the outside as in some kind of a basis to speculate on and to ensure the survival of the platform. Of course, it was spelled out in the Steem White Paper that Steem was built for the attention economy - tokenizing attention and selling it but somewhere along the way people forgot about that.
When the bear market reached the capitulation phase last November, Steemit Inc had to start cutting costs and generating revenue fast to avoid having the token price go to zero. Most importantly, Steemit Inc no longer has to rely solely on selling STEEM which helps protect the value of the investment of each and every one of us.
...just imagine if the entire 'attention economy' model was totally flawed...
( an 'old' adverting concept from the 70's, and no longer valid for the digital age).....oops...
Except that it isn't. Ads on front ends, while clearly profitable, are not the only way to monetize attention. Another important one is businesses creating accounts on Steem to have a presence here. That's what @coingecko has done. They bought three bitcoins worth of STEEM last October not to make money but to spend it for the biggest and most actively engaged cryptocurrency users - Steemians - to become familiar with them. It's working for them and also for us stakeholders.
Time (and markets) will tell...
A recent report put out by the media and technology research firm Midia underscores that point: “Engagement has declined throughout the sector, suggesting that the attention economy has peaked.
https://www.theverge.com/2019/3/3/18246868/attention-economy-fortnite-advertising-user-engagement
Thank you for sharing the article, though I've heard this point before -- when the music and film industries first noticed that videogames started allegedly eating into their revenue.
The point is that we're reaching peak attention partly because we've reached peak developed internet and low-income areas would need more leisure time to be (as a result of better income) to be a greater and more valuable part of this economy.
Human attention is not going anywhere as a concept, right now it's a more desperate battle for redistribution of said limited resource.
My point is still valid. The price of STEEM would be in an even worse shape without Steemit Inc starting to sell ad space on Steemit.
I wasn't disagreeing with you about that.
I was pointing out that if the premise of the steem whitepaper - built on 'the attention economy theory' - was (is) fundamentally incorrect...
(hence the... 'oops')
I see.
I don't think it's fundamentally incorrect. The attention economy is a vast industry. Internet companies worth trillions of dollars put together have monetizing attention as their business model. The paper you gave a link to only says the attention economy has reached limits and is facing diminishing returns. I don't believe it will ever die. As long as there are consumers with purchasing power, their attention will be valuable. And when it comes to growth opportunities, there are still billions of people who have low but growing purchasing power.
But you are right in pointing out the limitations of the attention economy. Attention to be monetized is proportional to population size and the value of said attention is proportional to GDP. Fortunately, that isn't the only potential non-Ponzi source of valuation STEEM can have. Steem is useful as a platform for storing digital assets trustlessly, gaming, gambling and subscription-based services including services well suited for a blockchain platform such as proof of authentication for documents.
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