Monetizing Internet city-states

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Taxation is the source of revenue for city-states. It happened in Roman times, it happened in Egyptian times, it happens today. Why, then, do so many online communities insist on letting outside institutions buy real estate on their local billboards as the main form of revenue? Facebook and Twitter didn’t have to be advertising companies. They had a critical mass of loyal citizens who ostensibly would be willing to pay for services the same way Americans pay for police, public school, and roads. They could have been online city-states. I like what 4Chan and Reddit are doing, to this effect. I bet the latter communities last longer than we expect them to, because they are treating the citizens of their communities as constituents, rather than product.

Sometimes I (and plenty of others) feel like Mark Zuckerberg and Dick Costolo are farmers and we are the crop. Yishan Wong and moot have an opportunity to be governors, or mayors. And when it comes to how they administer their sites and deal with community conflict, the differences are clear. Zuck and Dick’s constituents are clearly advertisers (though there is a tension there.) I don’t agree with everything that happens on Reddit or 4Chan communities – in fact I’m uncomfortable about most of it – but I think they operate with an unusual form of integrity. Unlike governments, which can go into debt, and even sometimes bankruptcy, companies need revenue or else they don’t exist. But online advertising revenue doesn’t seem to be easier to scale than online tax revenue. Ask any Wall Street analyst. The latter just feels like the more sensible system – the one likelier to last.

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