Diseconomies of scale in fraud, spam, support, and moderation

If I ask myself a question like "I'd like to buy an SD card; who do I trust to sell me a real SD card and not some fake, Amazon or my local Best Buy?", of course the answer is that I trust my local Best Buy1 more than Amazon, which is notorious for selling counterfeit SD cards. And if I ask who do I...

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Hasnain says:

Super long, super worth reading though.

"But unfortunately for Zuckerberg's argument, there are at least three major issues in play here where diseconomies of scale dominate. One is that, given material that nearly everyone can agree is bad (such as bitcoin scams, spam for fake pharmaceutical products, fake weather forecasts, adults sending photos of their genitals to children), etc., large platforms do worse than small ones. The second is that, for the user, errors are much more costly and less fixable as companies get bigger because support generally becomes worse. The third is that, as platforms scale up, a larger fraction of users will strongly disagree about what should be allowed on the platform."

Posted on 2024-02-19T05:27:28+0000