>The real oracle must work for free, if there exist any parasites. This is because the parasites can steal the labor of the real oracles, for free. So the equilibrium price is zero.
Can you walk me step by step of an example of how this works? In my mind it works like this
1. Oracle R(Real) and Oracle P(Parasite) advertise their services.
2. A company pays Oracle R to get it Data S.
3. Oracle R gets Data S
4. Oracle P steals Data S.
5. A company now pays Oracle P because it's advertising cheaper prices and has good reputation.
6. Oracle P doesn't have information to give and is revealed as a fraud.
I see no way for this game to have an equilibrium of Oracle R's price going to $0. Oracle P can only make their move after Oracle R has gotten paid, and Oracle R gets to set the price at which it gets paid. If their are multiple companies getting the same information, it can simply set the price such that many of those companies must pay it. The only way that this game has an equilibrium of $0 for Oracle R s if you switch step 2 to after step 5.
>All of these companies are considered incredibly successful. They delivered high quality products and services to users at unbelievably low costs and tremendous convenience. These companies gave people what *they* really wanted. You seem to want to give them something else, like Google+, which they really do not want.
So firstly, a companies success isn't only dependent on how it pleases the users. The success of it's business model is dependent on many factors
, like partnerships with companies in the ecosystem. Even if there aren't benefits to the users (which I'll argue there are in a second), there can be benefits to the ecosystem as a whole (which indirectly end up benefitting users).
From a partnership perspective, one huge advantage early on is that companies can credibly can commit to not locking down their data. This is going to be huge in the next few years as knowledge graph and facebook graph start bullying their partners in exchange for access to that data (Twitter has already done this). Note that there's no way to compete with these companies due to their network effect, unless you can credibly commit to not doing the same thing if the ecosystem switches to you.
>I don't really understand your Android Phone analogy. Many iPhone owners "jailbroke" their phones to install new apps,
Yes, but at huge risk to ruining their phone, and with an automatic void of warranty. What this shows is that users WANT this behavior, but Apple is doing everything in it's power to prevent it.
>and the Google Play store moderates for content (as do the individual developers who write apps).
There's a single checkbox in android to allow you to download non-android content, because the users want it. If there wasn't, someone would fork android and make a version that had it. Google would then lose its advantage in guiding the ecosystem, so it's in Google's interest to add this checkbox (in contract to Apple, which doesn't have this threat of a fork).
Likewise, the Google play store exists as a curation mechanism, but (this is the important part) because Android is open source, the curation choices it makes have to be beneficial to the users and ecosystem. If not, it's trivial for a Partner like LG to make their own store, and quickly get everyone to switch over because they're more fair.
Because iPhone is closed source, there's not this threat, and they frequently make choices that benefit them as a company at detriment to the users or ecosystem.
>Apps are constrained, by the operating system of the phone, and by the user's choices...one reason for this, is specifically to prevent the apps from interfering with the phone's core infrastructure or with other apps.
But in the closed source case, another reason is to protect the companies business interests by using monopoly and aggregation advantages to make decisions that benefit that company. Because of these advantages, it's far to costly for users or partners to switch to another platform, UNLESS there's a guarantee that this new platform won't end up doing the same thing once they have the same advantages. Right now, there's way to make that guarantee t in the case of data monopolies and network effects, unless you have a system like Ethereum. Again, this is hard to go through in a forum post, and I think the article I linked to above makes the case more thoroughly.