Not the original poster, but I think he is quite right.
IF you are getting a product or service for free, continuously, the company providing it usually has a different motive, a different way to make money. Usually that means selling your data, thus you are the product being sold in the statement the original poster made.
Can you explain why you consider the statement a banality instead of a rule of thumb? What kind of things do you not pay for where the company providing it is not gaining something from you using it?
I run several free websites where I don't have any ulterior motives. I do it for fun and have quite a lot of active users. Not saying you're wrong, just giving some examples where it isn't applicable.
It has just reduced to the new "cool kids" thing to say "if you're not paying for the product, you're the product". You are saying it usually means "selling your data" - while most of these websites clearly state in their policies that they DON'T sell your "personally identifiable" data in any manner to third parties. So that's that. Of course, it means they could aggregate the data and sell that, but then it really doesn't void my privacy much. Is Google getting benefited from my data? Definitely. Am I getting benefited from Google's services? Definitely. Does Google know much about me? Yes. Is Google selling my personal data? No. One just needs to be aware of what they are sharing with these service.
Them not selling data doesn't mean you are not "the product". You are being advertised to based on what Google know about you. To use another hyperbolic term, your "eyeballs" are being sold to others. You are the product.
Google not selling personally identifiable information is not out of benevolence, but because it makes their own position stronger. They are optimizing how to sell what you are giving them.
Not that there is anything inherently wrong with that, my point is that "If you're not paying for the product, you are the product" is usually true. Resigning it to the parenthesized cool-kids corner is (unjustly) diminishing the value of the sentence.
There's just one difference. "You are being advertised" is technically wrong. A product is being advertised to me, and yes, I have to look at it as a cost of using their service. They are advertising masses to the product companies, and product to the masses, but not 'personally me'. There's a huge difference here. I look at it more like a mutual contract between me and the 'free' service. They're not selling "me", it's more like you scratch my back, I scratch yours.
You are being advertised to based on the profile Google has built of you and the profile companies want to advertise to.
As such, your attention your time, based on your life, is being sold to advertisers. I don't see how being aware of this and being okay with this changes this fact? Of course there is a "contract" of sorts (which are always mutual) in play between you and Google, Google provides you with a service and you provide Google with whatever data you want.
Google in turn uses this to sell its product (people like you reading ads) to other parties.
I'm not saying this is inherently bad either. But the sentence is used to make people aware of the fact that companies like Google have something to gain from giving you something for free, which is something a lot of people hadn't thought about before or are aware of (especially when they are internet products). Thus I don't get the pedantry that this statement seems to evoke.
Let me rephrase: if you are not paying for it, you are the product, but you probably don't know it, and even if you did know it, you probably don't care.
If I was to go one step farther, I'd say the entire powerbase of companies like Facebook and Google is founded on a large mass of people not caring about their privacy. Maybe a step too far, but I'm not so sure.
Not so much not caring, but getting stuck in a vortext.
Free-to-use, privacy-voiding services kill any paid-for, privacy-respecting service. There's a race to the bottom -- Gresham's Law -- and the "good" services can neither gather sufficient users nor revenues to be sustaining.
The leaders, at the same time, have to stay ahead of all three fronts in the game:
1. They need low per-user costs to sustain themselves.
2. They need to exploit user data (or whatever other advertising-based edge) they have to retain advertisers.
3. They've got to retain sufficient network size and quality to keep smaller services from taking off, or from boiling-off the high-quality users who are no longer satisfied by the service.
Google launched G+ to kill Facebook. It failed in that, with a large number of arguments as to why.
But Facebook's initial attraction was that it was literally Harvard. That is: it began as one of the most selective, aspirational, and attractive (to both other participants, and advertisers) cohorts on the planet.
Metcalfe's Law is only so powerful, and it's a strong overstatement. There's both a falling value with additional nodes (Tilly-Odlyzko), and a per-user cost constant (myself). The size of a network is ultimately governed by that per-user cost.
(There is also, if you will a perverse T-O factor -- a subpopulation who are actively detracting from overall site value. This can be addressed by specifically addressing and neutralising those participants. The cost-constant isn't subject to this.)
Which is why a new social network could form, and relatively easily, among some sufficiently large appealing cohort. Throwing some funding money and support to individuals within such contexts might well take down Facebook, eventually.
(Though the replacement would almost certainly eventually present the same problem.)
I'd say you are probably right on this - it's interesting to consider how these companies actually function - sometimes the core product has been free - for a long time - and yet for services like YouTube - now there are paid options.
Can you imagine an internet search engine with a paid option? Perhaps a personal search assistant who sorts through all the junk to find what you are actually after? It may well happen.
As someone whose started a company with a "free product", seeing how it's been monetised has certainly been eye-opening.
