So I want to raise a concern and see
So I want to raise a concern and see what other builders think, because this seems like a MAJOR flaw in how this marketplace is operated...
With pay-per-event pricing, if one of your actors have negative profits, that doesn't affect your total profits. That protects builders from one bad actor wiping out the profits from their whole portfolio, but it creates a serious incentive problem.
Right now, a builder can publish a new Actor and price it extremely low (basically free). If that Actor loses money, the loss does not affect the builder’s other profitable Actors. So a builder can simply use this tactic to undercut aggressively, because there are literally no downsides.
Example:
Let’s say there is a normal keyword with a few good Actors. Most of them charge around normal market pricing, maybe $2-5 per 1,000 results.
Then someone launches a new Actor for the same keyword, with similar quality and reliability, but charges $0.01 per 1,000 results.
The cheap Actor might run at negative profit, but the builder does not really feel the loss across their whole account. The negative profit just becomes $0 for payout purposes. So they can keep the price extremely low to gain users, reviews, runs, and ranking.
Maybe the plan is to raise prices after getting enough market share. But NOPE. Nobody can raise prices again, because everyone is doing it
. The “normal” price disappears. The whole category becomes worth almost nothing.
This could (and will) slowly decimate the economics of the marketplace, especially now that building good Actors is becoming much easier, quality alone might not be enough to protect pricing.
If two Actors are the same quality, users will naturally pick the one that costs almost nothing.
The incentive is misaligned. If negative profit on one Actor affected the builder’s total payout, then pricing below cost would become a real business decision. Builders could still choose to subsidize a new Actor, but they would actually pay for that decision from their total profit.
I’m not trying to attack anyone using low prices, because I'm lowering my price under anyone who undercuts me just as aggressively lol.
But I think there's really no other way than aligning incentives and have negative profits affect your whole portfolio if we want this store to be healthy.
With pay-per-event pricing, if one of your actors have negative profits, that doesn't affect your total profits. That protects builders from one bad actor wiping out the profits from their whole portfolio, but it creates a serious incentive problem.
Right now, a builder can publish a new Actor and price it extremely low (basically free). If that Actor loses money, the loss does not affect the builder’s other profitable Actors. So a builder can simply use this tactic to undercut aggressively, because there are literally no downsides.
Example:
Let’s say there is a normal keyword with a few good Actors. Most of them charge around normal market pricing, maybe $2-5 per 1,000 results.
Then someone launches a new Actor for the same keyword, with similar quality and reliability, but charges $0.01 per 1,000 results.
The cheap Actor might run at negative profit, but the builder does not really feel the loss across their whole account. The negative profit just becomes $0 for payout purposes. So they can keep the price extremely low to gain users, reviews, runs, and ranking.
Maybe the plan is to raise prices after getting enough market share. But NOPE. Nobody can raise prices again, because everyone is doing it
. The “normal” price disappears. The whole category becomes worth almost nothing.This could (and will) slowly decimate the economics of the marketplace, especially now that building good Actors is becoming much easier, quality alone might not be enough to protect pricing.
If two Actors are the same quality, users will naturally pick the one that costs almost nothing.
The incentive is misaligned. If negative profit on one Actor affected the builder’s total payout, then pricing below cost would become a real business decision. Builders could still choose to subsidize a new Actor, but they would actually pay for that decision from their total profit.
I’m not trying to attack anyone using low prices, because I'm lowering my price under anyone who undercuts me just as aggressively lol.
But I think there's really no other way than aligning incentives and have negative profits affect your whole portfolio if we want this store to be healthy.
