It’s not apples to apples… are the small/medium platforms really going to be lacking in fraud etc if there are no large platforms to target?
The small sites only lack fraud because the large platforms draw the fire.
Diseconomies of scale in fraud, spam, support, and moderation
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Re: Diseconomies of scale in fraud, spam, support, and moderation
#42Earlier quoted context omitted.
This strategy seems to be especially effective for focused communities as they grow from 50-5000 users. As you approach facebook scales and a more generalized audience ("the public") I'd imagine the optimal strategy may shift some. A federation (small "f") of smaller, more focused communities might be the best you can hope for.
Has Facebook perhaps shifted towards a federation of communities? My Facebook feed as it used to be, general life updates by various friends, is pretty much dead. Nobody posts these things anymore. However, neighbourhood groups, Buy Nothing groups, and other local special interest groups thrive, I see several daily posts in each. Plus Facebook constantly recommends me more groups. This is a n=1 experience but I wonde…
Makes sense to me.
The admins of the groups are responsible for managing the discussion in groups including frontline anti-spam against the porn bots and the shoe bots and whatever. So it's semi-distributed moderation. (Assuming group admins care, but if they don't then users just abandon the group.)
Compared to e.g. Reddit, FB groups aren't as world readable or writable as subreddits are so you don't really get that classic inter-subreddit drama.
Where global moderation is still needed from FB's perspective is when group activities start spilling outside of that group, e.g. because they're coordinating extremist activity.
This probably won't be the result of user reports though. For privacy and scalability that implies an automated system which (hopefully reliably but only rarely) flags posts to a human working for FB.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#43Well, I received a keychron keyboard a few days ago. I ordered a used K1 v5 (Keychron does small, infrequent production runs so it was out of stock everywhere). After some examination, I've received a v4. It's the previous gen mechanical switch instead of the current optical switch. Someone apparently peeled off the sticker with the model and serial number and one key stabilizer is broken from wear, which strongly implies someone bought a v5 and returned a v4 they already owned. Apparently this is a common scam on Amazon now
This is a tangent, but I just looked at Keychron's website, and I don't know how someone is supposed to choose from all the models and options. And there seems not to be a "comparison" page on their site.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#44The author seems to be mistaking the benefit of selection effects with competence. Those who work anti-fraud for platforms know that there is something like a market for fraud. There is a market clearing quantity of fraud that will be present on any platform, dictated by the gains from learning to execute the exploit, the effort necessary to do so, and the number of times one might be able to do it. Small platforms h…
I don't see any mistake. > Small platforms have way less fraud because they are way less valuable to exploit, in general. Yes. > The big platforms actually are radically more competent at anti-fraud / anti-spam / etc, but the scope of their operations make them such juicy targets that there is a lot of it anyways. If their business model (scale above everything) results in shitty customer experience I don't really ca…
> If their business model (scale above everything) results in shitty customer experience I don't really care how competent they are.
It's a tradeoff. If your customer service is good such that more people shop there, there will be more fraud attempts overall.
It's not that a platform is too valuable for scammers, it's that a platforms is valuable at all. All platform value is value for scammers, and the most useful platform will also have the most scammers on it
Re: Diseconomies of scale in fraud, spam, support, and moderation
#45Earlier quoted context omitted.
> People like to complain about Uber, but my pre-Uber experience with taxi services was far worse Did you live in a small city back then?
I’ve used plenty of small-town taxi services, yes. If you’re only remembering the gold standard small-town service that did everything perfectly, you’re looking back with rose colored glasses. The typical experience back then was not good.
Well I'm pretty confident in my memories because it wasn't too long ago. The thing fell apart only around 2016 with the rise of apps and the inflection point was a complete misery hard to forget: drivers taking your order and not moving, drivers calling you to ask about the destination point and then refusing to go there, drivers telling you that you should've put the destination point into comments, driver asking you to cancel the order and pay them in cash etc.
However the apps were able to price-dump for around three years until all small players died, then hiked the prices back again.
I'm not saying anything about the "typical experience back then" however I do know that in right circumstances (high demand, cheap supply, no lock-in) competition between independent small companies can have remarkable results.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#46Earlier quoted context omitted.
>If I provide Andy's small town taxi service and have a customer service issue, I deal with it personally and properly or I go out of business. In a very small town, you won't go out of business because you'll be the only taxi service in town. Everyone can establish their 'monopoly power' in a small enough area.
Not really, because the entry barrier to create a small town taxi service is incomparably lower than creating a new Uber. 20 years ago my small town had around five fiercely-competing taxi services with cars arriving within 4-5 minutes of a phone call. In many respects that was better than the new times. Especially when it came to customer service.
When I say a very small town I mean way less than 100k people. There is a very high barrier to entry in being the second taxi service for outsiders because when it's that small everyone knows everyone else or their family by name so they don't trust outsiders easily.
Regardless of how permissive the regulations and bylaws are on the books.
And even when it's a second group of locals that want to establish a second taxi service, you can still establish your 'monopoly power' on one side of town, or specific areas. There's no practical bottom limit.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#47The real "economy of scale" in these platforms is not actually providing any support , moderation, fraud prevention. It's not that they scale it better, it's just that they don't do it and get away with it through market power. If I provide Andy's small town taxi service and have a customer service issue, I deal with it personally and properly or I go out of business. If I'm uber I just ignore it. It has nothing to d…
If I'm Andy's small town taxi company, I actually bet that nobody will spend thousands of dollars using me over a 20-50 dollar ride. I don't need to care, and no lawyer will go for a class action suit because the class is too small
Re: Diseconomies of scale in fraud, spam, support, and moderation
#48The author seems to be mistaking the benefit of selection effects with competence. Those who work anti-fraud for platforms know that there is something like a market for fraud. There is a market clearing quantity of fraud that will be present on any platform, dictated by the gains from learning to execute the exploit, the effort necessary to do so, and the number of times one might be able to do it. Small platforms h…
It's not just that the big platforms provide a much stronger incentive for fraudsters. It's that providing that stronger incentive is not a bug for the big platforms, it's a feature. It goes hand in hand with their business model, which is to sell access to as large a pool of users as possible.
> The big platforms actually are radically more competent at anti-fraud / anti-spam / etc
No, they're not. They are purposely incompetent at those things, because it's part of their business model. They cannot implement actual competence (which would mean providing sufficient actual human support to deal with the volume of mistakes that their automated algorithms make), not because it would cost too much (the article quite correctly points out that their huge profits provide plenty of cash to pay for human moderation), but because it would reduce their value to their actual customers, who are not their users.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#49The author seems to be mistaking the benefit of selection effects with competence. Those who work anti-fraud for platforms know that there is something like a market for fraud. There is a market clearing quantity of fraud that will be present on any platform, dictated by the gains from learning to execute the exploit, the effort necessary to do so, and the number of times one might be able to do it. Small platforms h…
OK, fraud exists. Irrespective of whether or not a platform is small or large, can they make their customer whole 100% of the time? Why or why not?
> can they make their customer whole 100% of the time?
They do make their customers (i.e., the companies who pay them for access to their users) whole. But their users (at least the vast majority of them) are not their customers; they don't pay for the service. (It's true, as the article points out, that even paid support at the big platforms is very poor, but that's because the money involved is still not even rounding error compared to the astronomical profits being made from selling access to their users.)
They can't make their users whole, or even a significant fraction of them, without breaking their business model. That's why they don't do it.
Re: Diseconomies of scale in fraud, spam, support, and moderation
#50The author seems to be mistaking the benefit of selection effects with competence. Those who work anti-fraud for platforms know that there is something like a market for fraud. There is a market clearing quantity of fraud that will be present on any platform, dictated by the gains from learning to execute the exploit, the effort necessary to do so, and the number of times one might be able to do it. Small platforms h…
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