Let me ask you a question: the Free Basics is targeted to people that can't afford another way to get internet. What will showing ads to these people accomplish?
I'd argue that's not to funnel use into a product that maintains market share through the network effect. That's the thing that made the free basics program so pernicious. What you are describe is just providing a poor service, rather than a service that is specifically tailored to stamp out competition.
Taking away that "free stuff" is not without consequence either. Now people without means can't read the news, watch tv, connect with friends and family online, play casual games, etc. Are ads more evil than taking away free access for those without the means to pay?
People willing (and able) to pay $50/y for this have the unfortunate correlating characteristic of being far more valuable as advertising targets than the average person.
In other words: If you are willing to give me $50 for ad-free internet, that's going to cost you $100. And so on...
Most people want things for free. If you asked them if they want free access with ads or paid access without ads I guess most of them would choose the first option.
But in monetary terms, what do these “free” services cost to various populations? The advertisers believe that paying for the service is turning them a profit, so someone is paying more for the advertised products than they used to. Is this a case of people with disposable income subsidizing everyone else, or one of manipulating vulnerable populations to spend their money unwisely?
>Advertising based 'free' things cost you far more than a subscription ever would.
Let's say someone watches 1 YouTube video per month. Is it worth it to buy YouTube premium at $12/month? What if that person makes minimum wage in the US? What if that person makes the global median wage: $227/month? Free advertising-supported things provide web resources that the poor wouldn't otherwise be able to afford.
It’s sad that internet is all free but an average American is OK with spending $105/month on a cable package and STILL be targeted with ads.
What a world we live in. The problem is not that average person doesn’t have money, the problem is that these advertising giants have gotten people to expect that online services should be free (but in exchange for privacy).
I am not assuming anything. People who don't have internt access are not using those service anyways. So those services will continue at their natural pace. So I don't see how free basics will harm the development of independent services.
Regarding Orkut, it had a lot of users before facebook arrived on the scene. But Facebook was just so much better that everyone eventually jumped on it. I doubt the outcome would have been any different had Orkut been free, considering that the network effect was a huge price in itself.
The point is, I am yet to see anyone who can afford a monthly data pack interested in choosing a service based upon it's inclusion in free basics. Free basics is good for those who won't use the internet at all otherwise.
And those poorer people aren't very valuable to advertisers, since they have far less money to spend on frivolous extras, so it's hard to run 'free stuff' services like this.
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