Paid in Full

Among the pillars of the creator economy is Patreon, a service that individuals with blogs or podcasts can use to administer subscriber paywalls and raise money from their audiences. Musician Jack Conte founded the company in 2013 after watching his YouTube ad revenue dwindle despite his massive audience. According to a 2019 Wired profile, Conte felt a “growing fury at the pittance” that YouTube paid. “In one 28-day period, during which his account generated 1,062,569 views, he received a measly $166.10 payout.”

Other platforms, including Twitch, Substack, and OnlyFans, have emerged as similar alternatives to big social media and the meager earning potential it offers. The rise of these alternative forms of monetization has pushed the centralized web to modify its own incentive structures. When, earlier this year, Twitter announced its Super Follow feature — a paywall for tweets — it represented the latest acknowledgement by a social network that Web 2.0 was over: If the platforms themselves did not provide adequate monetization tools, users would generate their content elsewhere.

Such features, Will Oremus argues, signal a departure from social media’s established model of holding users’ attention with algorithmically sorted feeds: “Users will deliberately choose to forge ongoing connections with their favorite creators rather than simply trusting an algorithm to surface engaging free content from a vast, impersonal reservoir.” This points to social media just becoming mass media again; instead of everyone making content for one another, an elite group of “creators” produce it for the mass of “users.” Of course, the creators who already amassed large followings during the “free” era of social media are best positioned to benefit from subscription platforms, paywalls, and collectible content, and they will continue to draw upon feed-powered social media to promote themselves and attract their paying customers. Those without followings, meanwhile, will have a harder time monetizing their output. The creator economy’s highly visible success stories conceal a huge population of users who cannot make a living from selling subscriptions any more than they could from YouTube ad money. In a 2018 piece for the Verge, Patricia Hernandez described the Twitch streamers who spend months or years broadcasting without an audience: “Many streamers actually remember the exact moment their view counter went from zero to one.”

For every high-profile streamer earning millions, there are many others earning nothing; subscription services and Super Follows are unlikely to change this. But in the meantime, we’ll have normalized an internet where everything is increasingly for sale and content must embed its own marketing within itself, in order to maximize its financial return. That is, we will have the world of NFTs.

NFTs are among the most visible manifestations of what’s being called Web3, a transformation of the backend architecture of the internet in response to Web 2.0’s limitations and asymmetries. Its vision is a blockchain-based internet that works less like an open network circulating “free information” and more like an expansive matrix of built-in ownership and payment infrastructure.

As with Web 2.0, third-party applications will mediate most Web3 activity for ordinary users. These decentralized apps will not necessarily look and feel altogether different than traditional web apps but will likely incorporate functionality that blockchain technology specifically facilitates, allowing mechanisms like crowdfunding to be incorporated directly into works themselves. Interactions will become transactions, and more types of information will likely be traded in NFT-like marketplaces. As such transactions become more fundamental to the web, users will have to hold cryptocurrency in digital wallets to pay as they go.

Web3 replaces one starry-eyed vision of the internet with something seemingly more pragmatic, where creators are directly compensated for content they produce while users are never allowed to forget the true cost of information circulation. Web 2.0 has already demonstrated that information can’t be free; it can only be subsidized, most likely by entities with deep pockets and nefarious interests. Its “open network” largely consists of centralized servers owned by major corporations whose dominance grows with each passing year. Yes, the internet has generally been free for users, but ethereal metaphors like “the cloud” have concealed its increasingly proprietary nature, its ongoing consolidation into a few monopolies. That centralization has proceeded in tandem for the internet’s back-end hosting, which is increasingly handled by Amazon Web Services along with Microsoft and Google, just as much of the front end is handled by Google and Facebook. In the face of these giants, individual efforts to monetize content without their involvement can seem absurd: one’s own personal webpage vs. a billion-user site.

But with blockchains and built-in transactionality, the picture would presumably look different. Web3 is decentralized and inherently monetized at its core through tokenization: Users who contribute computing resources to the collective, peer-to-peer effort of storing the internet’s data and validating that data’s transfer (replacing the centralized servers that currently predominate) receive compensation in the form of bitcoin or another cryptocurrency. In her 2020 book The Token Economy, Shermin Voshmgir writes that blockchain “introduces a governance layer that runs on top of the current internet, that allows for two people who do not know or trust each other to reach and settle agreements over the web.” In other words, Web3 makes the internet’s traditional intermediaries — the centralized corporate platforms — less essential to its ongoing existence, both as providers of its backend capacity and as subsidizers of its content via ad revenue. The social platforms’ role as distribution channels might endure, but their overall importance to the web will have diminished. In a sense, technologist Jaron Lanier’s old idea of an internet based on micropayments has finally arrived, but it has been transformed into an internet of micro-ownership.

by Drew Austin, Real Life |  Read more:

Image: Chat (2021) by Viktor Timofeev