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Facebook wants up to 30% of fan subscriptions vs Patreon’s 5% (techcrunch.com)
273 points by doppp 55 days ago | hide | past | web | favorite | 223 comments

Liberapay takes 0% https://liberapay.com/ It's European non-profit and open source. It's funded by the donation on it's own platform.

https://news.ycombinator.com/item?id=19270786 European non-profit is not the same as American non-profit.

So i made a new item for liberapay, since I thought it was worth it.

Also, I would much rather see Liberapay on the frontpage of HN than Facebook "fan subscriptions"...

We have enough multinationals that try to claim 30% on top of someone else's work.

Fyi. HN has flagged it ( lower ranking ) and removed European and 0 commission from the title without moderation comment ? ... :(

Generally speaking submissions should just match the <title> of the page... so if you want, write a blog post about it, then submit the blog post?

So who pays the credit card processing fees?

It's passthrough: https://liberapay.com/about/faq#fees

Liberapay doesn't take anything off the top


Do not worry; all these companies are private enterprises, so in US, freedom of speech doesn't apply anyway. Patreon/Paypal/Visa/Mastercard/Twitter/Facebook will drop you like a hot potato, once you publish something mildly controversial.

What distinguishes a Twitter or Facebook from a phone company? At scale these platforms have become vital to public communication in the same way as certain utilities. Perhaps it would be better if businesses facilitating speech communication had to classify as a common carrier or utility. As a carrier they would get exemption from speech liability and in exchange democracy -- which needs free public discourse -- can function. Any business entity that gains too much power over the public discourse will inevitably gain undue influence over the future of politics. Do we not all lose if that happens?

They want it both ways; to have the legal protections telcos have, and to have a tight control over their platform.

This was touched on in the Congressional hearing with Mr. Zuckerberg, where he avoided the answer:

SEN. TED CRUZ (R-TEX): Thank you Mr. Chairman. Mr. Zuckerberg, welcome. Thank you for being here.

Mr. Zuckerberg, does Facebook consider itself a neutral public forum?

ZUCKERBERG: Senator, we consider ourselves to be a platform for all ideas.

CRUZ: Let me ask the question again. Does Facebook consider itself to be a neutral public forum, and representatives of your company are giving conflicting answers on this? Are you a ...


CRUZ: ... First Amendment speaker expressing your views, or are you a neutral public forum allowing everyone to speak?

ZUCKERBERG: Senator, here's how we think about this: I don't believe that — there are certain content that clearly we do not allow, right? Hate speech, terrorist content, nudity, anything that makes people feel unsafe in the community. From that perspective, that's why we generally try to refer to what we do as platform for all ideas ...

CRUZ: Let me try this, because the time is constrained. It's just a simple question. The predicate for Section 230 immunity under the CDA is that you're a neutral public forum. Do you consider yourself a neutral public forum, or are you engaged in political speech, which is your right under the First Amendment.

ZUCKERBERG: Well, senator, our goal is certainly not to engage in political speech. I am not that familiar with the specific legal language of the — the law that you — that you speak to. So I would need to follow up with you on that. I'm just trying to lay out how broadly I think about this.

Common carrier status for phone companies in the U.S. was the price they had to pay for the monopolies they received to run telephone lines on public property or easements on private property, probably dating to earlier with telegraph companies.

Lawyers. There are lots of reasons, but it boils down to them not being like the phone company because they dont want to be. Facebook et al spend millions each year to maintain a very specific legal status across many areas.

So what? If Liberapay was based in the US, they could choose to continue hosting you if they wanted to. In the EU, they don't have that option.

That's a theoretical rather than a real objection since even if your platform doesn't get shut down the US payment processors such as paypal can shut you down and they're very difficult to get around - just ask subscribestar.

This just in: https://twitter.com/michellemalkin/status/110076019755373773...

Twitter sends legal warning for blasphemy. They couldn't find better timing for illustrating the point.

The amount of ‘America! Fuck yea!’ in that thread is cringe inducing. Is there nobody trying to talk about the issue at hand without invoking any of the crazy emotional appeals to American exceptionalism or Muslim hatred?

> The amount of ‘America! Fuck yea!’ in that thread is cringe inducing. Is there nobody trying to talk about the issue at hand without invoking any of the crazy emotional appeals to American exceptionalism

I was literally arguing, that the nice theoretical point of guaranteed free speech is null and void by the current implementation of communication/publishing/payment processing. Where do you find 'America! Fuck yea!' in that? If anything, it is a critique of the current status, which hides ugly reality behind nice theory.

> or Muslim hatred?

Oh boy, another huge can of worms. Muslims still have no idea, what is a hatred in the West. They interchange criticism with hatred, and then they react somewhere between rioting to violence, fueling the vicious circle. They have no idea how Christians were/are pushed around in the West (you can start with the Covington issue recently: they were automatically guilty for being white and Catholics); or don't even consider how they behaved/are behaving towards Christians in the Middle East. Food for thought: ever seen Christian no-go zone in Saudi Arabia? Thought so.

> Muslims still have no idea, what is a hatred in the West.

It’s stunning to read this. Are you really claiming you haven’t seen hatred towards Muslims?

> hey have no idea how Christians were/are pushed around in the West

And there’s where it goes from stunning to laughable. Yes, Christians, truly the most oppressed people in the West.

> It’s stunning to read this. Are you really claiming you haven’t seen hatred towards Muslims?

It is a fraction compared to the hatred from Muslims.

> Yes, Christians, truly the most oppressed people in the West.

Not only in the West; try being a Christian in the Middle East. You know, the countries controlled by Muslims today. Are you going to claim with a straight face, that they are not opressed?

Don’t try to deflect by putting words in my mouth.

> Not only in the West


Are you saying that there isn't free speech in the EU? What are you basing this statement on?

Many countries in the EU have blasphemy laws and the European Court of Human Rights says they are okay:


If someone criticised Jesus Christ in their podcast (for example), they would be putting Liberapay at risk. I don't believe Liberapay would allow that, so they'd just ban the user. That's what makes Liberapay a risky option.

That's quite different from "free speech is not considered". Every country has free speech exceptions: for example, in the USA "there are several common-law exceptions, including obscenity,defamation,incitement to riot or imminent lawless action,fighting words,fraud, speech covered by copyright, and speech integral to criminal conduct"

In th EU:

> The Charter of Fundamental Rights of the European Union has been legally binding since December 1, 2009 when the Treaty of Lisbon became fully ratified and effective. Article 11 of the Charter, in part mirroring the language of the Universal Declaration of Human Rights and the European Convention on Human Rights, provides that

> 1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers.

> 2. The freedom and pluralism of the media shall be respected. The European Court of Justice takes into account both the Charter and the Convention when making its rulings. According to the Treaty of Lisbon, the European Union accedes to the European Convention as an entity in its own right, making the Convention binding not only on the governments of the member states but also on the supranational institutions of the EU.

So, is speech in USA "freer" than in the EU? Yes. But in both cases free speech is recognized as a right.


> So, is speech in USA "freer" than in the EU? Yes. But in both cases free speech is recognized as a right.

True, but also trivial. Everyone pays lip service to free speech, even the most serious violators of it:


Article 67 states: "Citizens are guaranteed freedom of speech, of the press, of assembly, demonstration and association. The State shall guarantee conditions for the free activity of democratic political parties and social organizations."

That podcaster might be ordered to cease the blasphemy, and if they don't comply their website might be blocked, but I don't think that puts Liberapay at risk if they don't operate as a publishing platform but only handle payments. That woman didn't lose her bank account, did she?

While many EU countries duo have blasphemy laws, they're almost never enforced. They're laws that the majority of people find ridiculous and would be quickly removed if anyone started to actually enforce them. If Liberapay did block someone for blasphemy without being legally compelled, they'd likely face a huge backlash themselves. If they were legally compelled the law would soon be changed.

It's not like the US doesn't have a bunch of laws that violate free speech but are never enforced, and thus still sit on the books unchallenged.

In any case, European countries don't have blasphemy laws (there might be exceptions to this - I know Ireland had it until recently).

That case the parent linked is about defamation (calling Muhammed a paedophile), not blasphemy (for example saying Muhammed was not a prophet).

EDIT: so I was wrong. See the comments below.

The charge was blasphemy, or, in the words used in the article: "disparagement of religious precepts". It could not be defamation because there is plenty of evidence that Muhammad did marry and have sex with a child. That was not doubted even within the Muslim community until it became a source of controversy in modern times.

With Ireland's recent repeal, it seems there are now only 17 European countries with blasphemy laws, including Austria, where this case happened:

> Andorra, Austria, Cyprus, Finland, Germany, Greece, Italy, Liechtenstein, Poland, Portugal, the Russian Federation, San Marino, Spain, Switzerland, Turkey, the United Kingdom (Northern Ireland and Scotland) and the Vatican City. This list excluded countries like Belgium and Luxembourg, which provide narrower provisions for insulting the objects of a religion in places of worship or public ceremonies.


Well, it seems my understanding of the word blasphemy is not the commonly used: I was considering only "lack of reverence to a deity", while "insulting or showing contempt" to the practice is also considered blasphemy.

I stand corrected. https://en.wikipedia.org/wiki/Blasphemy_law

Austria does have a blasphemy law. https://www.ris.bka.gv.at/Dokument.wxe?ResultFunctionToken=a...

Specifically, it covers disparagement and mockery of religions and traditions if it is likely to cause justified anger. That leaves a lot open to interpretation (when is anger justified?) but it seems clearly aimed at blasphemy.

All countries in the EU must follow article 11 of the CFR.

Seeing as patreon, paypal, visa refuse clients because of their beliefs (alt-right) or their sexuality (which would be illegal in Europe), the US do not have free speech either

The US does have freedom of speech at the federal government level; i.e. the government is not supposed to repress speech. However, it appears the parent is intentionally conflating freedom of speech and a private entity's right to censor their own platform. One has literally nothing to do with the other; private entities in the US and abroad are largely free to run their platforms as they choose, including censoring content that violates their rules, and banning users who don't comply.

The parent likely knows this, and yet chooses to deliberately misinform in their comment.

You are conflating freedom of speech with the US first amendment. Freedom of speech is a principle. It applies to private companies as well. Voltaire didn't say "I disapprove of what you say, but I will defend to the death your right to say it, so long as it's not on Twitter, Facebook, &c in which case I'll beat you to death myself because private companies are entitled to censor their own platforms".

What's the point of having free speech protected by the government if in practice no company will allow you to practice your free speech?

An American can exercise their government-protected right to free speech on their own website. This right does not apply to someone else's website, since it would be infringing on the website owner's property rights. Freedom of speech doesn't grant the speaker the right to occupy someone else's private property.

If those websites wish to police speech to this degree then they can reclassify themselves as publishers and accept all the legal burdens that come with it. At least then they'd be intellectually honest.

Let's use Facebook as an example.

The "Facebook © 2019" notice on each Facebook page tells users that they are on someone else's website. Next to the notice is a link to Facebook's terms of service, which discloses their "Community Standards". Facebook has been dishonest in many situations, but they don't hide their ability to moderate content in any way.

It's certainly within one's right to be upset with Facebook's policies. If you feel strongly enough about this, you have the option to stop using Facebook, and you can switch to a different platform with policies that align more closely with your views. You can also publish your own website, where you can establish your own rules.

But Facebook's website is not your property, so you can't graft your preferred rules onto Facebook. You can ask them nicely and you can apply social pressure, but Facebook makes the final decision on how they run themselves because the site is not yours.

Yeah that's not really the argument I'm making. The argument I'm making is that Facebook is acting as a publisher and publishers don't have DMCA protection which is what makes the model work. They want the privileges without the responsibility.

Facebook doesn't become a "publisher" by removing user-generated content from its platform. They'll continue to qualify for DMCA Title II's safe harbor provision as long as they take down copyright infringing material that gets reported to them. Facebook is not required to leave non-infringing material intact to be protected under DMCA Title II.

But on the internet almost everything is on someone else's private property, unless you run your own website on your own hardware running on your own network and using your own DNS.

The commenter didn't conflate anything. They defined the legal parameters under which freedom of speech actually exists in the United States. You can insist on talking about this idealistic normative if you want, but in common parlance it's reasonable to refer to the legal concept by the colloquial term.

You know how you can say whatever you want on the street, but I can make you leave my house for whatever reason I want? Same idea. Free speech is only a coherent concept in public spaces. Otherwise my right to private property would be impaired by your right to say whatever you want in my dojo.

As for your last question...I mean, really? "What's the point?" Are you actually asking this in good faith? Go take a look at any country which doesn't have freedom of speech or freedom of the press. How about being able to say what I want without being disappeared in the middle of the night? If Twitter bans someone for hate speech you honestly believe that's comparable to something like Khashoggi's assassination?

You're quoting Voltaire like the stakes for private and public censorship are the same but that's utterly ridiculous.

> The commenter didn't conflate anything. They defined the legal parameters under which freedom of speech actually exists in the United States. You can insist on talking about this idealistic normative if you want, but in common parlance it's reasonable to refer to the legal concept by the colloquial term.

This is an opinion, and one many people disagree with. The idea of freedom of speech existed before the first amendment. They're not the same thing, it's just convenient for authoritarians to conflate them because it creates a narrower scope. It's intentional equivocation and a pretty flimsy argument tactic.

> You know how you can say whatever you want on the street, but I can make you leave my house for whatever reason I want? Same idea. Free speech is only a coherent concept in public spaces. Otherwise my right to private property would be impaired by your right to say whatever you want in my dojo.

Again, not the same thing, but what you're getting at is freedom of association. A company can choose whom they do business with, as an individual can choose whom they allow in their home. The interesting thing lately is that many people only believe in freedom of association when it means that they get to pick who is excluded, and very rarely believe in the actual principal. You can see this in the whole "gay wedding cake" situation that played out in the last couple of years. Much of the same political group that loves to trot out the idea that you can censor people out of existence on the internet was horrified when a private business chose not to create a specific message on their product.

> You're quoting Voltaire like the stakes for private and public censorship are the same but that's utterly ridiculous.

Not really, it's actually pretty dead on. John Stewart Mill wrote at length about censorship in On Liberty and specifically wrote about censorship via social pressure and how dangerous it was. It's not some imagined idea, it's just one inconvenient to a particular political group's goals right now.

Thanks for making these points so clearly.

The person you are rightly critiquing seems similar to the careless but widespread view that says, "sure, go ahead and X, that's fine, it's your [legal] right, but I think blah blah" with this thing few ever catch which is: it's often totally NOT fine to do something that is nonetheless legal.

You have the right to X, but I can still say STOP IT. And I could reasonably argue in various cases that X is anti-social or bad for any range of reasons. Please people do NOT just accept or do whatever as long as it's legal. That whole idea is craziness.

Private companies can't arrest you, put you on trial, sentence you to prison, or kill you. Government can. That's the point.

> Private companies can't arrest you, put you on trial, sentence you to prison, or kill you

In many US jurisdictions they can do the first (and so can essentially everyone else.) They also do the last, often without legal consequences, though not as the outcome of a judicial process (but in civilized countries, government can't do that as the outcome of a judicial process, either.)

But they can use their opinion in such a way that I am not accepted by the majority of other companies in the sphere.

I'm not picking on you in particular, but this is a rather annoying argument that people bring up that is utterly nonsensical. Companies can and do cause harm to individuals. No they can't put you in jail but they can otherwise isolate you from society via making you unemployable, revealing personal information to social embarrass you, or barring you from essential services to function in modern society. To pretend they aren't is to be in denial to the scope and power and of modern companies. I say all this as an ardent capitalist for what it's worth.

Sure, but no one is claiming private companies can't hurt you. That's not what this is about. Note the specific term used: the government can kill you. It is the sole arbiter of what's legal in its domain. The first amendment doesn't exist to protect you from being shamed or embarassed for what you say. It exists to keep you from being jailed or murdered to censor the voice of the people.

So no, it's not "utterly nonsensical." Everything you're bringing up is completely orthogonal to the political theory of freedom of speech.

I mean that is exactly what the thread was about. Legalism, and the 1st amendment is very uninteresting as an argument about morals to me. The principle of the freedom of speech is an interesting moral argument which these platforms (publishers if we're being intellectually honest) are often guilty of abusing. Slavery was once "legal" yet when people talk about freedom the entire concept isn't hinged on the 13th amendment.

I'm not conflating anything. I stated a fact, that the federal government cannot punish you for exercising freedom of speech, nor can it restrict your speech. Private companies aren't beholden to those restrictions on their own platforms. The person above the one I replied to was the one conflating the two, as I said.

> What's the point of having free speech protected by the government if in practice no company will allow you to practice your free speech?

It’s your right to talk, but that doesn’t compel anyone else to broadcast it. Freedom of speech doesn’t require that anyone he made to listen.

What Voltaire said is entirely irrelevant, this is a legal question.

Are we really going to pretend that financial institutions are “private” enterprises? I recall the taxpayer being forced to bail them out for their incompetence. They are effectively government institutions and should be regulated as such.

If you're going to abuse the definition of public vs. private that much, receiving a child tax credit makes me a publicly owned entity, which means I can't tell my kids not to be rude to their mother.

TARP wound up making a small profit in the end, incidentally.

Its more than that, banking is a legally granted monopoly license (ie. Federal Reserve).

So they are enjoying all the perks of being government backed (protected monopoly + full bailout privileges), yet must endure none of the restrictions of a government agency. Best of both worlds.

Banks operate under a ton of restrictions. Such as Dodd-Frank.

It's pretty ironic that the solution for being "too big to fail" was to make the banks even bigger while also placing restrictions of many types of trading.

What should have been done is just remove the FDIC insurance and let banks do whatever the fuck they want. The only way to learn that risk management is important is if you see some of your competitors as road kill on the side of the road.

Not to get off topic here, but banks were bailed out because they made subprime housing loans that went bad, however it was the government that compelled those loans in the first place. By doing what the government demanded (increasing home loans to people who didn’t have the proper credit,) the banks crashed. Government policy and housing “activists” created the housing collapse.


Freedom of speech is a general concept. It's not limited to only government censorship.

They might have free speech, but they have no means of getting paid for their speech.

If the right doesn't like being censored by private corporations, maybe they shouldn't make deregulation and allowance of this sort of behaviour a core part of their beliefs.

Me, I love seeing these guys deplatformed.

We still have Charlie Hebdo putting drawings of Mahomet on the cover so there is a still a lot of margin.

But it's good to stay vigilent.

It's not banned by law, but, especially after what happened to Charlie Hebdo (and it wasn't the first or the last incident like that, however probably most drastic), I'd say people are afraid to publicly say negative things about Islam, because the threat to their lives is very real. So, while we might have freedom of speech written into the laws and the state per se is not taking it away from us, it's also not protecting it enough from extremists who are against it.

That's pretty much the history of entire humanity. Freedom of speech doesn't mean you are free from the consequences of speaking, it means that the country you live in consider it a right.

And CH kept publishing on the same theme AFTER the murders, showing that they do, indeed, have freedom of speech, and are willing to use it.

1. It is not freedom of speech, if the consequence of speach is death.

2. If the country considers freedom of speech a right, shouldn’t the country make serious attempts to protect it? It does so for other human rights.

Free speech is a general society convention, omnipotence doesn't exist.

You have the right to not be raped as well, doesn't mean we can prevent all of them.

What right do you know that can be guaranteed all the time, under any circonstance ?

My point is that the state is not doing enough to protect freedom of speech. Obviously, no 100% protection is ever possible.

By the same argument, we can assume everyone in the US is now afraid of going to war after 9/11?

I see you have a deep understanding of European laws, which remarkably are also exactly the same for all 44 countries end for all 28 EU members.

Care to enlighten us?


Patreon is selling a service, Facebook is selling access to an audience. Two seemingly similar but vastly different offerings. That's why Facebook can have a lot of crappier versions of other products that are still successful (e.g. Facebook events vs. Meetup.)

I doubt they'll be able to get away with the terms as is, but it wouldn't surprise me if they manage to successfully charge significantly more than Patreon and still get a lot of customers.

> Facebook is selling access to an audience.

I remember their promo videos promising access to "millions of people" and "your imagination is the limit". Turns out it isn't feasible to spam all the people in your friends list with all your updates, so Facebook decides who sees which. Want more people to see your posts? Your wallet is the limit.

> access to "millions of people" and "your imagination is the limit". > Want more people to see your posts? Your wallet is the limit.

I'm not seeing anything inconsistent in that position. They didn't promise free access to their audience. The imagination of how much you can spend is indeed the limit.

>They didn't promise free access to their audience

It was literally the default setting until they started making people and orgs pay to reach all _of their own, organically grown_ audience.

People were advertising their FB pages in advertising, on billboards and signage all over the country for a couple of years. I'm talking like Realtors and run-of-the-mill small businesses, etc. It all just turned out to be free advertising for Facebook because they changed their mind after reaching scale and needed to turn on some more profit.

In my mind at least the 30% fee was the price for access to the audience.

Absolutely correct and the best comment here imo. It’s very different to provide an audience vs. providing a service.

But once past initial audience discovery, the recurrent billing of patronage donations is just pure service.

So logically creators should only use FB for access to new audience, build a relationship with the newly acquired audience, and pivot to direct billing or Patreon for recurrent collection.

By the same logic, YouTube creators should only use YT to build an audience, then switch to hosting their own videos. Yet they want to remain on the platform.

Video hosting costs a lot of money.

Sending an API request, to the credit card company, to bill the monthly payment, does not cost a lot of money.

Getting your audience to switch platforms for the monthly payments is a compartively easy thing to do, compared to setting up your own video hosting site.

More to the point, neither is very easy to do in practice.

That's a move some creators are at least seriously preparing for. And building a patreon user base is a good step for that.

But pas

I don't understand why people are acting like this is ridiculous and will obviously fail. 30% is the same cut that Apple and Google take for everything that goes through their app stores, including all in-app purchases. It's the same cut that Steam takes. It's the same cut that YouTube takes for channel membership. Twitch takes an even larger cut: 50% from subscriptions. It's extremely well-established that people are comfortable with platforms taking that large of a portion.

Patreon is the outlier, and they're dropping hints now that it probably isn't going to last: https://www.cnbc.com/2019/01/23/crowd-funding-platform-patre...

Disclaimer: I'm working on a platform that allows you to contribute to open source as a whole and which distributes your money proportionally to how much you care about various projects. I'm thinking of taking 30% as well.

I think people are just getting hung up on the number without thinking deeper on what it costs to make things sustainable.

5% of the 500 million Patreon claims to be able to process is 25 million. According to their team picture on their website (https://www.patreon.com/about), they have 74 employees. That amounts to $330000/employee. Halving that to account for benefits (chair, table, wifi, insurance, etc) leads to $165000/employee for salary which seems reasonable average for a senior employee in the Bay Area. Notice this doesn't account for infrastructure, taxes, outside counsel/contractors, etc. It's crazy that after working for 6 years and creating half a billion of value, a company can barely afford to keep the lights on, let alone make a profit. I agree 30% just makes sense for a platform - you need enough to hire properly, pay all expenses and make enough of a profit for this to make sense. The alternative is half a billion of value disappears to save on a few million which I think is incredibly myopic.

Common, as a VC-backed company Patreon doesn't even pursue a sustainable business model. Most of those 74 employees are for anything, but sustainability. When they first started they had like a few people and pretty much the same service as they do today.

$165,000 for a chair, a table, wifi, and insurance... is a really outlandish assumption about per-employee costs.

An high quality chair is, say, $500 amortized over 5 years. A table, $100 amortized over 5 years. Open office space (at 65 square feet per employee and $100 per square foot per year) is about $6,500. Insurance is about $7,000 a year per employee - total.

So, under 10% of that extra per-employeee revenue is what the actual costs for those "bonuses".

If you're charging 30% then donors and the projects they support are better off leaving you out of it and just interacting directly with each other as you don't appear to be providing any significant value to either side.

Apple and Google provide significant added value in their app stores: distribution, discoverability, licensing, testing (at least in Apple's case)... etc.

Patreon is not that. At its heart, it's primarily a service for collecting donations. There is some content hosting, but that's kind of a secondary feature.

I seriously doubt Apple’s cost to administer the App Store is double digit percentages of revenue.

The 30% is a tithing to Apple for creating iPhone in the first place.

Patreon could sort of justify the same thing. Their real product is just the idea that anyone could be a monthly patron at all. That’s worth a LOT to creators. People didn’t think that way before Patreon.

What content can you host on Patreon? I only really have experience with authors and text is cheap to host. Can you host video?

Nope, Patreon doesn't host video. Generally I think people upload their Patreon-exclusive videos to YouTube as unlisted and use that as a free hosting service.

Video no, but you can host audio. They have functionality that lets you set up a patron-exclusive podcast for example

Text and images. It's pretty basic, mostly meant as a way for project creators to provide updates on what they've been doing.

Patreon is actually largely a paywall-service. It's about collecting donations AND tying that to accessing paywalled stuff.

Yes, but Apple and Google have monopolies.

Not a "gamer", so I don't really know what "Steam" is/does, but I suspect they must have some kind of moat.

I'm not sure that people are comfortable with Patreon taking a 10% cut.

I'm not happy about eBay taking a 10% cut, but they have a monopoly. Jack Ma, please bring Taobao to USA!

Steam is, despite there being a lot of competition, the de facto one stop shop for digitally distributed PC video games (and is in itself a kind of DRM protection). I think that a large proportion of gamers would be happy for almost all of the competition to disappear in favor of getting everything on the Steam platform.

> I think that a large proportion of gamers would be happy for almost all of the competition to disappear in favor of getting everything on the Steam platform.

Yup. Competition is good for the market in general, and for consumers in a more indirect way, but balkanization of content space and having to deal with the crappy apps of me-too competitors is a real pain.

(There's probably some economical theory around this that I don't know, but my gut-feel classification is this: competition is good for consumer when competitors are providing the same, or at least directly substitutable, goods and services. Individual video games - and music, movies, books - are not substitutable goods, so the competition is useful only to the extent you can get the same game/movie from any of the competitors. Exclusive publishing deals make competition harmful to the consumer.)

> There's probably some economical theory around this that I don't know ... competition is good for the consumer when ...

Yes, there is a pretty standard economic proof that much of capitalism is based on. It says that an economy is most "efficient" (you can take a class on that word), when three pre-requisites are met:

1. Perfect information: Everyone knows the value of everything.

2. Commodities: Products created by competitors are equivalent. This works well for oil and bananas, but not so well for much else.

3. Access to Capital: This means new competitors can start competitors and enter markets easily. This isn't so easy when there is regulation, monopolies, or network effects.

In short, there is a set of circumstances when things work really well. However, in the real world, those circumstances rarely arise.

Keeping Valve in check is worth the friction. Today they might be benevolent now but when Gabe Newell is gone they will have same problems as Apple because Steve Jobs is gone. There is a high risk a new CEO will just be a paperclip maximizer.

valve is different (not sure if for better or worse) in that it's privately held.

That's because Steam's community features are second to none.

I don't really want a monopoly, though, having more than one store is better in the long run, even if it sucks having to register for multiple services. At least it's not like streaming where your costs go up the more services you register for.

The ideal would be if Steam could let other publishers plug in their platform for a much smaller cut of the profits and handle sales, forums, friends, wikis, with the other publisher handling distribution, marketing, etc. Or at least if it could function as OAuth and I could use my Steam profile on other publishers' services, carry over my friends list, maybe achievements, etc. Of course that still leaves Valve in a monopoly position, but I think it's an ok compromise.

Steam functions as an OpenID provider, so external vendors could (theoretically) use Steam logins for their platforms.

The problem with "competing platforms" is that they're mostly not competing platforms. Recently Metro: Exodus was pulled from Steam store to be sold as an exclusive on the epic store. This is not competition, this is a monopoly on distribution of a title.

When different platforms emerge where most platforms have most titles (or offer DRM free like GoG or Humble Bundle), then we will have actual competition.

The alternative is always to offer your content from your own website, and take 100%.

The game developers who were around before Steam, know how much that costs (promotion wise), and know they get a lot for that 30% cut. The same is true for those other platforms.

You seem to be a person that expects all internet platforms offer their stuff for free.

And another thing: all of those platforms mentioned have competitors, so calling them monopolies is quite strange. It's not because they are market leaders that there is no alternative (which monopolies don't offer)

You will be taking 100% of nothing… Because no traffic will visit your page versus Google's or Apple's traffic.

In the same way you can put a store in a rural place, or you could put in in New York 5th Avenue with warrantied traffic.

And of course that 100% does not take into account your cost of hosting, creating or adapting the necessary infrastructure and maintenance.

Exactly! And then people complain that the prices of real estate on 5th Avenue are outrageous.


Please tell me which one of those things you named are a monopoly, and I will name the closest competitor.

I'm thinking about Craigslist, Snapchat, Vimeo, Mixer, etc. Don't confuse market leader with monopoly.

Before Steam, you had several casual portals (all competing with each other). Do you know which cut they took? 70%.

Do you know why platforms nowadays take 30%? Because it's well worth the 30%, that's why. And if you think a platform can live off a 3% cut, please show me the successful on that does that.

> Do you know why platforms nowadays take 30%? Because it's well worth the 30%, that's why.

That is not the way things work.

Why does Apple take 30% of sales? Because Apple prices at the profit-maximizing percentage and because Apple figures that the profit-maximizing percentage is 30%.

Lower, and they leave money on the table. Higher, and sales volume goes down.

Ever hear of something called "consumer surplus"? A gallon of gasoline would well be worth $10 to me, but I pay a lot less then that! Why? Because of competition.

Lucky you that there is more than two colluding "competitor" steel stations.

In the white darn city here, the prices are within 1 cent of each other and everyone somehow raises them whenever there is any excuse.

Differences between cities are up to 20 percent. Sometimes (not considering externalities) it would be worth driving much farther to buy petrol. Few people do it.

Local monopoly or collusion is as good as global one. For Google Pay, the local is whole main Android store.

Where they do compete with cheaper alternatives (e.g. in South Korea), the premium is lower. But only there.

Facebook essentially guesses a price on their advertisement monopoly on their platform. The price is not set by competition nor by demand, but by belief in value added (which is only partially responsive to supply and demand), just like in most stocks.

I recommend reading on the concept of elasticity and substitute good, as well as idiosyncracies of human economical decisions.

Price is set by supply and demand, nothing else.

30% is the price, set on the non-monopoly market. I don't get what you are complaining about.

The point is Apple have a monopoly. Your supply/demand point is facile. For small indie developers 30% is an outrageous cut. That is what the complaint is about.

For Steam specifically, I can state with confidence that that's not true. On a phone at the moment so linking is difficult, but Jeff Vogel (the definitional "indie developer", there are very few people who have been doing it as long or as consistently) has a GDC talk on YouTube where he goes through his numbers--and he's a guy who went to Steam very late overall.

Steam's bigger marketplace and that it removes the uncertainty and risks around payment provider management (chargebacks etc.) easily make up for the bigger cut. Do less work, make more money. It's not unreasonable.

Thanks for that. Big fan of Jeff Vogel. Hadn't seen that talk so a link would be great.

I'm not saying Apple don't provide a service, of course they do, though at times it sucks. My main point is about is about the price, not the principle. I pay Apple a yearly subscription just to develop for their platform. On top of that every sale I make they get 30%.

Would 95% be ok?

Another extreme element of this is that I cannot sell a licence outside of the App Store to my customers. I cannot ask them to buy from my website (which many have asked about and would be happy to do) and provide them with a code they can use to unlock or upgrade. This is explicitly banned. Unless you're a big player like Spotify or Netflix your app will not be allowed to do this. I've tried and been denied and stonewalled.

In this case I am willing to build and manage my own payment/licencing setup to gain 30%. I'm just not allowed to do that.


And I don't, tbh, have an opinion about the rest of your post; I'm talking about Steam, not Apple.

But, having gone down this road myself (and why I cite the Jeff Vogel talk): you would almost certainly spend more than 30% on customer support and payment processing and fraud protection and accounting. Or you would do it incorrectly, which is worse. And, regardless, you'd expose yourself to a way smaller audience. It seems to me to be a good way to shoot yourself in the foot for no gain (and as an app developer myself I certainly wouldn't bother).

> For small indie developers 30% is an outrageous cut.

No indie game developer that has been around for a while would say this. A 30% cut is way less than anything else that came before it.

Steam also allows you to sell Steam keys from wherever, and you get to keep 100% of that. This is how Humble Bundle works.

When you release on Steam, you also get free exposure at first, which is basically free ads. You would otherwise pay several thousands of dollars for that.

So in any sense, Steam worked to get that 30%, and there is no serious indie game developer that is arguing with that.

I'm not a game developer and I don't know the Steam setup very well. I would genuinely love to hear from some 'serious indie game developers' though. Do they really think 30% is fair? Or maybe are they, like me, just accepting it and have no other real alternative (Hobson's Choice)...

Which is not exactly happily handing over 30% of your earnings to Steam/Apple.

Also, as mentioned in other replies, Apple explicitly blocks any other licencing path unless you're one of the big boys and can afford lawyers etc...

To be honest, these days it's harder to justify those 30%, as what you get from Steam marketing-wise today is just a poor shadow of what you were getting five years ago.

Apple has a "monopoly" over the app store as much as Disney has a monopoly on Disney movies.

I don't think this is a fair comparison. If I had the skills (which I certainly don't), I could make a cool Disney style movie and make it available for anyone, and even charge them whatever I liked.

I explicitly cannot do this for iOS apps. There is just no way for me to get my app in front of people's eyes without paying the Apple tax.

If I was prevented from distributing my movie somehow by Disney, you might have a point.

> I could make a cool Disney style movie and make it available for anyone, and even charge them whatever I liked.

Disney's not going to put it in their online store, though.

In the case of an iOS app, you can sell the source and let people build it on their own Xcode installs, if you like.

It's more like if Disney owned the DVD standard and could dictate who could and couldn't put content on it.

Then we'd all have a half dozen completely incompatible physical media players and so on.

Not an accurate comparison.

It should be mentioned that Steam's monopoly is assulted by new players like Epic with a 12% cut.

Which might be for the best, Steam is in dire need of a serious competitor (I know GOG and co exist but sadly they have not been able to make a real dent in Steam's marketshare).

Steam has dropped so many balls and the main thing going for them is inertia.

Also, just because paying a large cut to various middlemen is common does not mean it is ok.

It is not even close to assaulted. It is not inertia, but network effects and completeness of package offered by Steam, as well as resale deals.

Inertia is also a thing. No way am I leaving 150 titles behind or splitting a collection of a game between different platforms (eg Far Cry 1 -> Far Cry 6).

Valve cut their fees to 15% recently for games that sell well, and reduced the normal fee from 30% iirc. Epic Games has brought serious competition to the industry, offering a broadly used game distribution channel for a low price.

No, the normal fee is still 30%, and the reduction is only for extremely high-sales games and never goes below 20%:

> Starting from October 1, 2018 (i.e. revenues prior to that date are not included), when a game makes over $10 million on Steam, the revenue share for that application will adjust to 75%/25% on earnings beyond $10M. At $50 million, the revenue share will adjust to 80%/20% on earnings beyond $50M.


The Epic store really isn't much of a competitor at all yet, the only reason it's having any impact at all is because they've been paying developers to release exclusively on the Epic store.

I think you underestimate Fortnite. It is a game played mostly by kids and teenagers. Often, they don't have a Steam account. So if Epic catches them, Steam won't get them.

Steam is a platform for video games and is by far the leader in this market. They do have some competition, and their take is 30%

About the only places I'd call actual competitors... Are none. Nobody is close to 10% of Steam sales and specialized in video games. They are a monopoly and will push the price. They cannot push it too much or a cheaper small store might overtake them, but competition is not the force setting the price. The cost of switching is. The network effect strength are.

Maybe someone in China could, but they don't directly compete.

GoG has a niche they're trying to expand, as does Humble. A few other small stores. Game company ones (EA, Blizzard, Ubisoft) are not even close. Funny enough, the small shops often resell Steam keys...

Gog recently announced that they'll allow third party stores to resell gog keys (mobile, so no link). I really hope that shakes the market up a bit (and I generally really like gog and always prefer then when there is price parity)

eBay takes 15% plus some listing fees and that doesn't include the PayPal fees.

The problem isn't the %. It's the perpetual IP license, which grants Facebook complete non exclusive rights to the Creator's IP, including licensing it to third parties without further pay to the Creator.

Patreon requires you to grant them an extremely similar license:

> You keep full ownership of all content that you post on Patreon, but to operate we need licenses from you.

> By posting content to Patreon you grant us a royalty-free, perpetual, irrevocable, non-exclusive, sublicensable, worldwide license to use, reproduce, distribute, perform, publicly display or prepare derivative works of your content. The purpose of this license is to allow us to operate Patreon, promote Patreon and promote your content on Patreon. We are not trying to steal your content or use it in an exploitative way.

(from https://www.patreon.com/legal)

It also states that it's for the purpose of promoting the creator's content on Patreon. For example, showing a thumbnail image of your video on another page as a recommendation would count as a 'derivative work.' Without this right, it would be virtually impossible to get permission from the creator for every instance in which Patreon wants to promote content in a new way. Also, it seems that the creator on Patreon would continue to benefit when Patreon earns value on the content.

Facebook, on the other hand, has numerous ways to benefit that don't proportionally benefit the creator, including from indirect revenue sources like advertising and data enrichment that don't flow back to the creator in any way. I suppose this is alright when you are just showing cat photos to your family, but it's quite different when you are basing your business on someone else's market-dominating platform with large negotiating leverage. And there are known cases where Facebook has been known to very liberally appropriate ideas from companies that are competitive with them (e.g., Snapchat).

It states clearly that it's also "to allow us to operate Patreon, promote Patreon, ...".

So if your content would make a good ad for Patreon, you've given them permission to use it without compensating you.

but... sublicensable?

I don't know what you're asking. It says "sublicensable" in there, yes.

I think he means that's the most unacceptable from the bunch

Sublicensing is what legally enables things like rich media link previews (the kind you see on Facebook and Twitter) or APIs to exist. Yeah, theoretically they could use that to sell content, but in practice it's generally used to make the web more interoperable.

I think it makes sense if the business relationship is actually artist <--> patreon <---> consumer. The client pays patreon, so patreon must sublicense the content to him. Otherwise I'm lost.

This boilerplate exists in literally every site that hosts user-created content in some form and displays it to other people. If it didn't exist, the site would immediately be violating your copyright if they showed your content to anyone other than you

That doesn’t explain why it needs to stay in effect after you terminate your relationship with them.

Backups. Why commit to reliable destruction of data when you don't have to?

Google has a guarantee on when your deleted data disappears from tapes in vaults, and it was something that every engineer at the company had to think about (not to mention a ton of work in actually implementing it). You may wish for Some New Startup with 2 engineers to do it for you, but it's hard, takes time, and nobody actually cares. Look at how many people use Patreon despite that policy. Why spend years of engineering work when your lawyer can get the problem fixed in 5 minutes? It's just economics.

The issue with facebook is not that they simply hold a copy of your data after your relationship ends, but that they have permission to continue using it. Few content creators would object to Facebook keeping a random copy of their content on a tape drive. It's like a book publisher keeping your a copy of a rejected manuscript in a warehouse somewhere.

The real problem is when Facebook uses that content to further their business interests. Likewise, the publisher shouldn't be sending that rejected manuscript around for others to mine for ideas.

(that said, to avoid the temptation that gives rise to this precise problem, it's common practice for publishers to return rejected manuscripts)

> Backups. Why commit to reliable destruction of data when you don't have to?

That argument makes no sense if you're talking about publishing, AKA making something available to the public.

I disagree. By default, the copyright holder reserves all rights. For the website to display that content, they need a license. When the owner deletes the content, it disappears from the website, so no license is required. This is a "happy path" that allows an agreement like "when you delete your account, you revoke our license to distribute your content, and we will comply with our legal obligations".

But the real world of production computer systems is not always the happy path. Consider the case where you delete your account, then the service suffers a database problem, and your content doesn't actually get deleted (failover to a replica, restore from backup, etc.) Now they are violating that contract with you. That is why they make the terms of the contract "in perpetuity" so the engineers can fix the production system incrementally, rather than saying "welp, there's a risk of a lawsuit if we failover to the backup, so we're shutting off the website and paying back the shareholders, everyone go home, we're done here".

Like I said, some companies take a middle ground where they really do guarantee deletion even if unhappy events take place at exactly the wrong time. It is possible. It's just not very economical.

Well thank god the GDPR already killed that old scapegoat (unless your creative content backups are guaranteed 100% PII free).

If this was just about liability, the terms could be much narrower. They're intentionally broad to guarantee the maximum benefit to the platform and allow them to come up with other uses for that data later on.

This is exploitative and only works because of the power imbalance between platforms and individual creators. Even if you follow the idea of the "free marketplace" you'll have to acknowledge that creators have no individual leverage when it comes to platforms with "take it or leave it" ToS.

I love when non lawyers try to claim that two completely different things are actually the same...

The objectionable part is not the exclusive license. The objectionable part is the sublicense right, which lets Facebook sell creators works to third parties without paying the creators, and even after the underlying business relationship with the Creator has ended.

I truly believe its these excessively large cuts that make it impossible for these platforms to really grow, grow to something actually substantial.

I know what some are thinking, these platforms are extremely successful. this is partially true, but they haven't thrived anywhere near I think they are capable of.

Those cuts are egregiously large, IMHO. Those platforms should be hacked into pieces until competition forces them to fall (or have their pricing regulated like a utility's).

Their billion users seem pretty content to use them in spite of the numerous alternatives.

I have a mac app which is exclusively available on the App Store, so I pay 30% of my revenue to Apple. I could spin up my own system but then I have to build out payments (credit card processing fees), distribution, updates, beta testing, and figure out discoverability. In the end, my app isn't big enough to build these things out myself, but at least if I wanted to I could. Different story on iOS.

> beta testing, and figure out discoverability

I feel like these two are much harder than the others. How does the app store help you with beta testing? Isn't discoverability basically a lottery?

Oh yea, I get beta testing from hockeyapp since testflight isn't out for the mac.

By discovery I mean lots of users go on the app store and search for apps to download directly, no marketing or SEO needed. Adding the website, trials, SEO, etc helped a bit probably, but my app seems to just live on app store organic searches.

I'm not saying those platforms don't provide value and that they shouldn't charge anything, I'm just saying that 30% is egregiously high. I don't know what Apple's App-Store operation costs are, but my gut feel is 5-10% would be more realistic rate to charge.

30% is high, I agree. And I also pay over 30% to the government for taxes after that too.

But at the end of the day what can I do? There's not really competition to drive the commissions down. If another app store came up and offered 10% commissions and the audience I'd go there instead.

> 30% is the same cut that Apple and Google take for everything that goes through their app stores, including all in-app purchases.

Both Apple and Google drop subscriptions to 15% after the first year.

One thing that helps justify it to creators for all these services (including Facebook) over Patreon is that they at least provide hosting, usually of bandwidth-heavy video files or live streaming. Patreon just hosts the equivalent of a Twitter feed linking to YouTube videos.

I don't use patreon but isn't there often 'patron-exclusive" content? I thought that content was hosted on patreon itself.

I’m not actually sure if Patreon hosts video, but the one creator I subscribe to, AvE, posts videos a early for patrons as unlisted YouTube videos. After a week or so, they go public.

All the patreon-exclusive videos I've seen (5+ channels) have been unlisted YouTube videos. I've never seen a video hosted on patreon.

To add to this, while the cut is 6 times larger, you only need a 40% larger audience to make up for the cost.

I could see that happening given that you'd have a huge base of people with accounts already and it's a platform for sharing content.

I would be more concerned about platform censorship with both of them.

I remember when reasonably smart cellphones first came out. You could hook them up over USB and change things like ringtones or backgrounds. It was fun.

Then manufacturers and cell phone companies started realizing the money train they were on. They made billions by selling this same crap to people who didn't know how or have the time to customize their own phone.

As it turns out, billions of dollars tends to get people's attention. Now those same companies are locking down PC boots, taking out headphone jacks, and all sorts of other things to "help" us have better computers. Each of them will involve trying to keep those cash cows lying around, maybe grow the herd a bit.

My point is this: smart people caught on to this bullshit. Facebook, Patreon, and the other fan/audience aggregation systems are doing the same thing, just with a different platform. I'm not sure, but I think the folks are catching on faster this time around. We're going to end up with an internet where the tech elite use services that actually facilitate their lives while the rest of the world use various subscription and "helper" services that try to extract as much money as possible from them at every turn.

> As it turns out, billions of dollars tends to get people's attention.

As Sir Tony Hoare lamented:

> At first I hoped that such a technically unsound project would collapse but I soon realized it was doomed to success. Almost anything in software can be implmented, sold, and even used given enough determination. There is nothing a mere scientist can say that will stand against the flood of a hundred million dollars.

I get the feeling that a lot of modern products are boondoggles on the merits but "doomed to success" because FAANG et. al. put them on a pedestal and the media is all too happy to go along with corporate marketing narratives if it grabs eyeballs (see e.g. the ridiculous amount of hype around foldable phones, which are sort of neat but hardly a revolutionary advance).

>(see e.g. the ridiculous amount of hype around foldable phones, which are sort of neat but hardly a revolutionary advance).

Yea what's going on with that nonsense? I can't wait until consumer electronics turn into appliances and all this tech messianism finally dies off. It's not like the newer stuff really is better anymore. People are just looking for their next hit in tech products.

We're leaving capitalism to enter into a new type of society. Rentierism. Everything is already owned. It's like feudalism, but you can have as many feudal lords as you want to live under--as a service.

Should coincide with a new technological paradigm in on-demand labour contracting. They should give it a catchy name, like VaaS: Vassal as a Service.

You know, renting out by the hour the right for services to give you free stuff and vie for your attention span might actually work.

E-gads we live in a weird world

How is this a "Patreon killer" at all? In addition to the extra 25% cut, they will also apparently demand IP rights that would continue even after you stop using their service.

Are they thinking that people will sign up for this because it gives them instant access to lots of people on FB, and that justifies the higher percentage? I'm guessing that creators will end up having to pay to get exposure, just like brands, which nullifies this potential benefit.

> By posting content to Patreon you grant us a royalty-free, perpetual, irrevocable, non-exclusive, sublicensable, worldwide license to use, reproduce, distribute, perform, publicly display or prepare derivative works of your content.

"Perpetual and irrevocable" means that it continues even after you stop using their service.

With the difference that much of what "happens" on patreon is not actually hosted there, and thus doesn't fall under that clause if I understand this correctly.

Yeah but I would imagine Patreon is working towards introducing their own video hosting platform at some point and build out their moat. Otherwise they're a glorified Paypal button.

Oh, they'll kill Patreon by deprioritizing Patreon links in user feeds.

I think it would make the most sense for creators to have accounts on both Patreon and Facebook.

Alternatively you could pay to promote your work on facebook which you will have to do anyway and take payment on patreon.

Which will be promptly banned and your Facebook privileges revoked. Like YouTube tries to.

Welcome to walled gardens.

What? Facebook will happily take your money to advertise pretty much anything and everything, it doesn't matter where the payment is eventually taken.

Which is a great reason for everyone to get off facebook asap.

I miss those times when enthusiasm used to drive the net. Seeking profit in every corner of one’s life is demoralizing to say at least.

Most regular people call this behavior... survival. Anything else is an extreme luxury reserved for a minuscule fraction of the human race.

That mindset is only necessary if you intend the Internet to be your sole income.

I work a tiring manual job for three days to pay bills and buy nice things. The rest of the week I have some time to take photos and write other content which I share freely online.

I don't expect or demand that anyone else pay for my hobbies.

No, not really. And do the extent people do live that way, it’s a new phenomenon.

A hundred years ago most people had vast swaths of their productive life that operated outside of the economy. Housewives cooking meals, people fixing their own cars. Dances in barns. Etc.

Many “regular” people still live that way, which is where your statement is false.

Over the last 100 years there has been a concerted effort by business owners to displace all of that activity and replace it with productized equivalents in the economy:

You don’t cook, you buy frozen dinners. You pay to have your complicated car fixed. You don’t walk your friends dog, you get paid to do dog walking gigs. You gramma doesn’t cook you soup, you get it delivered. People don’t meet up in a barn, you go to a club and pay a cover.

This is new. And I’m not even saying it’s fundamentally bad for us. But for some of us it is disorienting.

Because the non discretionary parts of your life like rent/mortgage and medical is so expensive people don't have time after investing 50-60 hours to walk the friends dog.

Note that someone who only works 40 hours but has to commute 1.5 hours to and from work because they can't live in the city where the jobs are and spends 2 hours taking text emails while not actually at work has committed 65.5 hours of their time.

half hour getting ready for work, 1.5 hours driving there, 4 hours on lunch for an hour, 4 hours on, 1.5 hours getting home.

People working multiple part time jobs are worse off. They may be "working" 60 hours and committing 80.

Guys, perhaps, we should to give such examples a context.

I lived/studied in Boston, MA number of years, and I used to meet up with my childhood friend who immigrated from Georgia roughly 8 years ago at his late teen years. He graduated from a very prestigious business school, and has a decent job but after the day was over he used to do some extra stuff, like driving someone from place to place, some screw driving job (I don't exactly know). It seemed crazy to me, I asked numerous times what are you doing dude? His response was extra $ is not a bad thing.

It might sound a bit bold and too generalized, no offense, I'm up for conversation - in the US people forgot what it means to rest properly.

Roughly a year ago, I was visiting my good friend in Germany, who immigrated 15 years ago. He was encouraged by another friend who lived in California to move to the US. We sat down and make a list of comparisons. Just to name a few:

Germany: 1. Workers Union protects employees. Pays a salary (70%+ of it) for 6 months if one looses a job. Also, a simple cold is good enough reason to take a week long leave and you're encouraged to do so. - US? no bro, you're on your own. It's a god damn pressure that makes people work unworkable hours and being in the endless state of anxiety.

2. Car insurance - he drives a new BMW and pays ~ 350 USD per year. We quoted the minimal package for insurance in MA for the same car, guess the number? 10fold: 3000 USD per year.

3. Education? - Free. US: 70$K per year.

4. Cost of food. Well, Germany is "notorious" even in EU for grocery affordability.

5. And Beer? German Hefeweizen 60 cents. Samuel Adams? no thank you. (half joking)

I did eventually left the US, although data science/engineering is the dream job generate money, but quality of life is no less important than the number of 0s at the end of bank acc. balance.

Steam takes 30%. Apple, Google Play take 30%. Physical stores can eat 60% unless you're selling something that's demonstrably saleable. Those sorts of markups aren't at all weird for access to a market...

And that's what it is, as SatvikBeri has already said. People typically don't go to Patreon to find new content. They consume the content elsewhere (YouTube, Facebook, etc) and then go to Patreon. Facebook et al are packaging together a huge userbase as well as a very targeted marketing service amounts.

In the big scheme of things —because I'm sure some people do browse— Patreon is just the money processor.

Edit: Should also point out that YouTube has a similar system. Users can pay 100K-sub channels a fixed £4.99/month and Google keeps 30%. It's all about the point of contact. YouTube, Facebook, established app markets, etc all have near-monopoly access to people. That's why they can demand the big bucks.

It's a bit more complicated, which is why many content producers still use Patreon even if they want an alternative.

Patreon not only collects money, it also provides a way to assign rewards, define goals and notify patrons (filtered by reward level) of new content.

It's not a publishing platform, but it's not just a payment processor, it's also a kind of marketing platform.

That said, the most appalling part of Facebook's "competitor" is not the 30% rate, it's that their ToS try to pull the same bullshit stunt they try to pull on their social platform: tricking you into believing you owe them perpetual transferable rights to everything you share via their platform. They know this isn't actually enforceable (at least not in all jurisdictions internationally) but they still try to trick people into believing they unknowingly agreed to it and are comfortable exploiting those in jurisdictions where this nonsense works and those who don't know any better.

> But whatever cut it takes will be after processing fees and the 15 to 30 percent tax Apple and Google levy on iOS and Android in-app purchases. We’ll see if Facebook tries a workaround that pushes users to their mobile browser where it can take their subscription money tax-free.

That makes it kinda ridiculous.

$5 subscription.

30% to Apple: $1.5

30% to Facebook: $1.05 (of the remaining $3.50)

Leaving the creator with: $2.45

I assume it will be out of control of the content creator regarding how the subscriber chooses to pay/subscribe, so the margins could be all over the place.

Heh, now assume the creator makes $80k/yr and lives in California.

Marginal tax rate - ~38%?

$5 subscription.

30% to Apple: $1.5

30% to Facebook: $1.05 (of the remaining $3.50)

38% to the Government: $.93 (of the remaining $2.45)

Leaving the creator with: $1.52

50% further for housing and 15% for healthcare enjoy your 53 cents.

Rent doesn't increase if you personally earn more money. (only if everyone around you earns more money too.)

> 38% to the Government: $.93 (of the remaining $2.45)

If the invoice you give your customer says "$5.00", isn't the tax taken from that? That's how things work in Europe, the gross income is taxed.

No, because the shares of the transaction that go to Apple and Facebook were never your income to begin with.

Alternatively, those costs are simply deductible from taxable business income, for the same result, even on individual returns. (In the US business income is taxed on a net basis.)

The US taxes sales twice. You get taxed on the sale itself, which is the scenario you describe. Then you get taxed on your income at the end of the year, which is the "38% marginal" rate being described here.

So Facebook are essentially like an email spam operator here. They have billions of targets (customers), so only have to find a small number of suckers (customer sub-set) to make it profitable.

No doubt you'll need to sign up to Facebook to even view the content, so I'm out then.

Its nice to see the multinationals agree 30% is a decent taxation level.

Even 30% of the revenue, while most taxation is based on the profits only.

They've learned their lesson - taxing profits means everyone will pull off bullshit accounting tricks to make their profits as close to 0 as possible.

The US government just needs to rebrand itself as an app store & platform, and we'd be done with all this controversy around tax rates.

This seems like the sort of thing that could only move forward at a company like Facebook. If this were proposed as an independent business, it would be laughed out of the room.

Of course Facebook has enough loyal users that they might actually be able to make this work..

Why would it be laughed out of the room?

FYI, here's the current top comment in this very thread:

> 30% is the same cut that Apple and Google take for everything that goes through their app stores, including all in-app purchases. It's the same cut that Steam takes. It's the same cut that YouTube takes for channel membership. Twitch takes an even larger cut: 50% from subscriptions. It's extremely well-established that people are comfortable with platforms taking that large of a portion.

Because a new company would have nothing to offer for that 30% that Patreon doesn't have. Facebook has an audience.

It's interesting what happens when there's such a massive user base when Pateron's entire user base (~5M pledges) is less than a fraction of a percentage of FB's users. Albeit the rate of conversion is taken out of account, but we're still talking about differences in orders of magnitude.

To actually see content creators sign up for this would be a sign of the times.

Well, Facebook has somewhat transparent guidelines for banning, and will be held accountable in public if they overstep. Patreon doesn't, your business with them as a creator is as safe as it is with PayPal if you're putting out controversial content.

Transparent? Never heard of zucc?

Indeed. It's sadly not that hard to imagine them doing it.

Sometimes, I feel like the Facebook hate train is just too much and then stuff like this comes along.

Am I being paranoid that, by collecting CC numbers, Facebook will then use that to share data with retailers to collect the precise purchase history of a user?

You mean like this product Facebook already has? https://www.facebook.com/business/help/1278167592274041

I'd say not that paranoid.

No, you’re not. I can’t give details but I was working on this 4 years ago in SF. Major shopping centre corporation.

This is great news! Hopefully it will keep Facebook's Fan Subscriptions from becoming popular.

Geez, none of the comments here mention surveillance! That's the ONLY focus Facebook really has.

The point of this is OBVIOUSLY not just profit, it's about figuring out how to get more and more stuff to live in Facebook, be run by Facebook, and tracked by Facebook.

Zuck and Sandberg can't tolerate the idea that people are donating to things and they don't know about it. They want to know who donates to what and all the other details. And they'd like to eliminate the existence of any content that's outside of the Facebook ecosystem.

I wonder if Facebook will be able to pay content creators on time. Might be worth a significant drop in revenue to some folks who depend on services like Patreon in order to pay rent if they're able to at least get their money when they're supposed to get it.


You need to take into account that fan subscriptions are a miniscule percentage of the overall user base. It's not like an app store where a whopping 1/3 of users buy apps. Just because facebook has a larger userbase it doesn't mean people are going to use it "out of convenience". If creators don't see a financial advantage , they 'll redirect their sponsors to patreon or another cheaper medium.

This could be a huge boost for Patreon.

A significant fraction of creators will seek alternatives when they hear about the FB product, or after being burned by it.

The problem isn't in on the creator side, it's getting users to go, sign up and pledge. FB already has the users, it just needs to give them an option to sign up.

Twitch streamers also use Patreon, but subscriptions and cheers on Twitch are more successful from what I can tell - it's closer to the content. If somebody is using FB as the primary way to release content, it's only natural to also do the donations/subscriptions on FB.

I'd expect high-end buyers (who typically account for a large majority of the total market) would follow the creators to Patreon if it's creator community expands rapidly.

there is no way in hell I am giving FB my credit card number. Idont need to give them another avenue to track me offline.

"The policy document attained by TechCrunch shows Facebook plans to take up to a 30 percent cut of subscription revenue minus fees, compared to 5 percent by Patreon, 30 percent by YouTube, which covers fees and 50 percent by Twitch."

Looks on par with other providers.

Everyone arguing against this is forgetting that this is FACEBOOK, premier social network on the planet. sure it's unhip to actually use it for networking now but everyone and their mum is still maintaining a presence on it(no the vaunted snapchat only teens don't count, they have secret facebook accounts linked to none of their peers to participate with their selfsame anonymized peers in meme pages on facebook)

all they'd have to do for this to be successful is to make reach for partnered pages the same as it used to be before they limited it. there are pages with 1million followers who have a reach of 10-100k right now coz of the new rules.imagine if facebook said "partner and you get 1 million back".

Damn, if Facebook actually had a face, it would be quite punchable I must say...

Best description I've ever heard of the company.

FB is charging a premium for accessing an economy of scale (audience).

As a content creator that charges $25/mth, would you rather: 1. Patreon - 500 subs 25x500x.95=$12,500 rev 2. FB - 5K subs 25x5000x.70=$87,500 rev

10x growth doesn't seem unrealistic given FB's scale and $$ motivation to grow your audience

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