A month ago, I was up in the mountains, with virtually no internet connection – at my tent-cabin, there was none. Just me, a cooler of beer, a zero-G chair, and a Kindle. Paradise. Only problem is, I managed to lose the Kindle somewhere in the woods. So I took advantage of Amazon’s self-created holiday and bought a replacement. Kindle Paperwhite, as good a single-purpose device as you could ask for. Everything you need, nothing you don’t, sorted. But like the original, I went for the one with “special offers.”
Because right now, you can’t get anything else. They offer the Paperwhite – the cheapest one with built-in illumination, all I really require – for $120. And it comes with advertising, on the lock screen and in a banner at the bottom. Not particularly intrusive, not particularly interesting, mostly for Kindle-original content (which tends toward the self-published, far as I can tell) – but the kicker is, you can pay to turn off the ads. It will cost you a slick $20, one time. Apparently, somewhere in there, Amazon has calculated that the lifetime value of you seeing their ads is $20. But then, you don’t see them very much.
By contrast, look at what Amazon has done since the tremendous bust that was the Kindle Fire phone. (Seriously, Jayne Mansfield didn’t have a bust like the Fire phone was a bust.) Now instead, they have a slew of low-cost Android devices, which can be bought by Prime members…with special offers. The version without the ads will set you back an extra $50. Given that my original Kindle lasted me approximately six years, and that most people keep a phone from two to three, but that you’ll see the lock screen of your phone a LOT more than the lock screen of your Kindle, that’s probably a rough equivalent. We’ll stick with 2, because low-cost phones don’t hold up as long as flagship models, but consider it: if you are a Prime member, it’s worth $25 a year for Amazon to have that eyeball space.
Which makes sense. You paid $99 a year to be on Amazon Prime and have that free shipping, so it’s worth kicking back $25 of that as an annual phone discount to show you more things that your Prime membership is, in turn, likely to speed you along to purchasing. Amazon has the same appetite for data as a Facebook or Google, but it’s very single-minded: Amazon wants all the data you can generate about buying stuff, because they want you to buy more of their stuff. It’s bits in the service of atoms.
When you get right down to it, Amazon and Apple are the only companies who deal in atoms anymore. Apple is largely agnostic about what services you use – one gets the sense that they run their own services out of some atavistic Scarlett O’Hara impulse to never be hungry again after Steve led them back from the brink, but let’s face it, most folks have Google email and probably do streaming music through Pandora or Spotify rather than Apple Music and they’re all using Twitter or Facebook or Instagram or Snapchat. And as long as you laid down the $650 for that iPhone, that’s fine with Cupertino. (Of which more later.) Microsoft is kept alive partly by Xbox gamers but mostly by the fact that every major business still relies on Microsoft Office (even when it runs on a Mac or – heavens! – an iPad). Google and Facebook don’t even have a physical product to sell you, unless you count the slender market for the Pixel or the Chromecast or maybe the abortive $1/year charge for WhatsApp. Those are paid for entirely with your eyeballs.
Amazon has its dubious side, no doubt – mostly because it’s laundered the Wal-Mart monopsony for the digital era and the upper-middle-class market – but in this, at least, it seems straightforward. Amazon will feed you ads for other things Amazon can sell you, much like Sirius XM’s 40s Junction channel will never advertise anything but itself and other SiriusXM stations. But for other companies and other applications, that advertising is everything. Because they sell your eyeballs along to other takers. It seems like almost every new app that comes down the pike on the iTunes App Store is free and then charges you…to remove the ads.
So I have to ask myself again: how much would Google have to charge you for their services – or Facebook, or anyone else – before it would be more profitable than just selling advertising against your data? And since they don’t charge…is it valuable enough they can’t? And at that point, how well off am I not using Facebook or Google products? And then I remember that Facebook owns Instagram and that 80% of the people I email with use Gmail…and maybe my goose is cooked no matter what. And that’s when you need regulation. But that’s a story for another time.