Aside-effect of the explosion of ChatGPT and other Generative AI products has been the sudden realization of how bad the search experience has become. When it launched, Google differentiated itself by its clean and simple user interface—at a time when the web ran amok with pop-up ads. The latter now seems to describe a typical Google search experience, with the first screen filled with sponsored links, followed by exhortations to buy your search prompt at various stores, and ending with more advertised links. The clutter and lack of context seem to extend to other big networks. As Elon Musk shakes up Twitter, the site seems a shadow of its earlier relevant self, with irrelevant tweets popping up everywhere. The less said about Facebook the better, with Mark Zuckerberg trying to cram every possible social product and experience into his groaning app. As Meta tries to make Instagram look more like TikTok, loyal users including the Kardashians are campaigning to let ‘Instagram be like Instagram’. Younger people tell me that even Tiktok is losing its sheen, and the mighty Amazon too is riddled with ads as it tries to counter the slowdown of its commerce business with advertising revenue.

An FT article by economist Tim Harford (bit.ly/3JaGRH9) tries to explain this phenomenon through an economic lens. Harford quotes writer and activist Cory Doctorow who explained this penchant for all networks to eventually degrade and fall apart through a memorable term: ‘enshittification’. “Here is how platforms die,” Doctorow wrote. “First, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves.” In a social network context, they first design the networks for their end users: clean interfaces, fast results, great connections. As user growth explodes, they start feeling investor pressure to ‘monetize’ these users, and the shift to business customers happens. The Eric Schmidts and Sheryl Sandbergs then take over the business reins from founders and ruthlessly go after appeasing business customers—either advertisers or sellers on the platform. Finally, as they become the dominant network, they also tend to become equal-opportunity abusers of businesses and users.

Two major factors underpin successful networks: network effects and switching costs. In the former, people use a network because that’s where their friends are. Most of us have tried weaning off WhatsApp to go to Telegram or Signal, but have returned because our friends are still on WhatsApp. Similarly, all sellers blindly go to Amazon because most buyers are there and vice-versa. Switching costs imply the trouble of building your social graph and preferences all over again. Moving from Twitter to a Mastodon or Koo means you need to rebuild your friends circle. Moving away from Amazon implies abandoning your e-books which are locked in that platform. You would have even experienced the costs to switch operating systems—say from Android to iOS, or Mac to Windows—and the sheer hard work and annoyance that entails.

Doctorow talks about how these switching costs are “weaponized”, with social networks deliberately creating frustrating hoops that you have to jump through to move away. He has explained this through a fascinating story titled ‘Unauthorized Bread’ which features a proprietary toaster that only accepts bread from certified bakers!

These weapons directly lead to the ‘enshittification’ that we are seeing in networks today. Successful networks take huge losses while subsidizing their growing user base and even suppliers. When they have a critical mass, they turn to monetizing it at the cost of their user experience. Economists have proposed interoperability as an antidote to this toxic behaviour. We should ideally be able to send messages from Facebook to Twitter, when we move from one social network to another there should be a way to transport our social graph along with us, or be able to take our e-books with us when we exit Amazon.

For some time, Web3 philosophies represented a light at the end of that tunnel, offering decentralized games that let you take your virtual weapons (and rank credentials) with you when you moved to another game. While this might sound strange, Harford argues that this works in the real world: coffee shops, restaurants or local taxis do not serve you badly because they know you can go somewhere else with your money and appetite. The same should happen in social networks—before they descend into a putrid monopolistic morass.