Netflix and the Threat of the Experience Machine
In which we (un)subscribe to/from endless services
I vaguely remember being able to physically rent a movie when I was a kid. Back then, you still had a thing called a movie rental store. Imagine that. Go in, pick a few movies, pay, watch, and bring them back a few weeks later. One-time payment.
Today, we subscribe to Netflix for movies, Spotify for music, Amazon Prime for groceries, and Hello Fresh for our weekly meals. No more one-time payments, but monthly ‘poof and it’s gone’ deductions from our bank accounts.
Welcome to the age of the subscription model.
One of the most notable examples of a subscription model is Netflix. The company started as a DVD rental service but transitioned to a streaming service in 2007. Today, it has around 232.5 million subscribers. Similar story for Spotify. Start in 2006. Today, around 515 million active users.
So, what has led to the rise of subscription models?
One factor is convenience. Consumers are increasingly looking for ways to simplify their lives, and subscription services offer a one-stop shop for all their needs. Rather than having to purchase individual products, they pay a monthly fee and have access to everything they (think they) need.
Cost-effectiveness is another key factor. Subscription services often offer a (seemingly?) better value proposition than traditional models, particularly for those who consume a lot of media or use a particular service frequently. For example, a Netflix subscription may be cheaper than purchasing individual DVDs or paying for cable TV.
But let’s not forget that subscription models have also been successful because they provide a predictable revenue stream for companies. Rather than relying on sporadic sales, companies can count on a steady stream of income from subscribers each month.
Sounds good, doesn’t it?
It would be silly if I wouldn’t put a subscribe/pledge button here and encourage you to click if you haven’t already…
But all is not well in endless subscription land and I’m not only talking about unintentionally racking up monthly bloodlettings for your bank account.
A great 2021 paper by philosopher Maria Brinck, with the apt title ‘Disoriented and Alone in the Experience Machine’, addresses an important issue with the algorithmic personalization used by almost all subscription services. It’s not surprising that she uses Netflix as an example.
First, let me introduce you to the experience machine.
The experience machine is a thought experiment first articulated by philosopher Robert Nozick in his 1974 book Anarchy, State, and Utopia. The idea is simple: imagine a machine that can stimulate your brain to simulate pleasurable experiences that are indistinguishable from the real thing. Would you plug in? If you have a hedonistic streak that prioritizes pleasure, your answer will lean toward yes.
Brinck makes the case that if current subscription services continue on their paths of (often tacit) deep personalization, we’ll end up with experience machines that provide us with the illusion of participating in a ‘shared world’, while we’re actually hooked on content customized to keep us consuming and eager for the next Netflix binge. She sees three overlapping risk factors for this that are already present in a lot of our current subscription services:
The illusion of a shared world. (Experience machine: “Hey, everyone is watching this, don’t miss it. Look at all those five-star reviews!”)
The reality of deep personalization. (Experience machine, whispering to itself: “Ha, they don’t know this is tailored just for them. Sit back, little customer, you won’t be able to resist.”)
The provision of mirror content. (Experience machine, continues whispering: “I know what you want: people like you, doing things that mirror your lived experience and confirm your biases. Enjoy.”)
Of course, personalization isn’t evil. Sometimes, it’s even desirable. The problem begins when that personalization happens beyond the control of the user with the sole aim to keep the consumption going (and profit rolling in). Brinck writes:
Again, this paper is not meant as a critique of all forms of personalization, nor am I disregarding the value and need for “filtering” and for more homogeneous subcultures. Rather, the point is that one ought to enter an exclusive space willingly and knowingly, which depends on awareness of the world beyond.
There are tweaks that can help us prevent a dystopian hedonistic Matrix scenario, such as options to opt out of personalization, transparency, and/or the choice to see what others are being served. The issue here is that these options will have to be installed by the subscription service providers (unless they are enforced by governments or international organizations or something, like the EU is pushing on privacy provisions for social media companies.)
So, seen any good movies lately?
Based on what I've read about the history of Netflix, the algorithm was created to stop churn. Once the studios realized what was happening, they quickly raised the price of content. Netflix countered by making their own content, which is very expensive. It's essential to keep subscribers engaged in order to keep funding new content. Smaller streaming services face the same problem. In many cases they will take a popular show and dribble episodes out weekly. This prevents people binging and cancelling, only to sign up when something else comes out that they want to see. In my dozen years of developing apps for iPhone and iPad, I've seen most developers transition to a subscription model. This is often done to permit a "try before buy" option, but it also gives the developer a more stable income. That allows for development of new features, which in turn keeps subscribers committed. In my case, all my apps are paid up front, once. By default this caps the income I can expect to make, but I am in a very narrow niche market that does not like subscriptions. Ironically a lot of developers will not subscribe to software tools, if a one-time purchase is available.
Pulling back and looking at the overall picture, the subscription model is becoming the normal mode for almost everything. We're all becoming hosts to parasitic corporations that either keep us tethered for things like food and shelter, or in thrall to services designed to capture our brains. (Looking at those "free" services like Tik Tok, Facebook, Twitter, et al)
Our laziness shows up in many ways. Convenience, letting machines do our thinking for us etc. In your face and unimportant takes precedence over the meaning of life. Geoff