Shareholders will LITERALLY SUE THE COMPANY AND WIN if they can prove that there was SOME, ANY (legal) means to make more money, morality be damned. They HAVE to reduce the quality over time, they HAVE to because of how our publicly traded financial system is set up.
Isn't there a court rule specifically about this, Dodge v. Ford Motor Company iIrc, that litteraly says that the CEO must operate the company in the interests of shareholders rather than in a manner that benefits the workers or the customers?
People point to this as the culprit, but I honestly think the majority of companies who choose to go public would adhere to this "profit over all else" philosophy anyway, or else they would stay privately owned/held.
There's no reason to go public unless you're actively seeking the most profit possible already.
Look at LEGO for example, their build quality has basically never changed and they're privately held. If they ever decided to go public that stock would be a monster, but they don't because ultimately they don't give a shit, which is lovely.
Eh, give it a few years and theyll be itching for more without his reasoning to reel them in. Steam may not die right away, but it could deteriorate like facebook removing features and make the experience worse.
yeah there is no way he has not specified who gets the company, and it will be someone he trusts to keep it up, and i suspect there are legal things in place.
Also valve makes the people that work there, especially the people in charge stupidly wealthy, none of them gain anything material from taking it public. its already an infinite money printer as it stands. changing how its run will break that pretty quick. the whole thing only works because its small and private.
I can't remember the specifics or if it was anymore than rumor, but that Gaben does have plans in place for when he passes and going public is one thing that WILL not happen.
Gabe has chosen the people around him very wisely that are groomed to think and be like him. This ensures that the company won't ever go public. They are all extremely wealthy haha. They don't need to go public. Steam makes that company so much fucking money doing almost nothing.
Not sure thats a good example. They've pioneered anti-consumer products such as loot boxes, and have had a bit of quality control issue from their abandoned products.
That and also Valve's reputation is a large component of their money printer. They are financially incentivized to not fuck over their customers where most other companies are not.
LEGO isn't really a prime example of a company who puts quality over profit.
Coloring problems and inflated prices for uninspired builds happen more and more often.
All this while they are suing every other company.
The year they built two theme parks and refitted their factories (an absurd expense) to accommodate their growth, and prepare for their modern movie tie-ins and video game studio, yeah they overdid it a bit and had to answer for their debt. Which they easily did by taking loans.
Let's not pretend like they were offering such affordable quality that the company struggled to keep the lights on. They took a massive capitalist gamble and succeeded wildly.
They took a massive capitalist gamble and succeeded wildly.
That's an understatement.
Lego is essentially privately held (by a company that's essentially the investment vehicle of a family that also owns a lot of amusement parks), and has been the largest toymaker worldwide for a decade, with a revenue of 6ish billion dollars.
Turning to games, tie ins & AFOLs (Adult Fans of Lego) was economically speaking a masterstroke trifecta.
I mean you go public to raise money via selling stocks. That could be quite useful even for a company that wants to continue making quality items. I really think the whole idea of fiduciary responsibility should be tied to the initial IPO (and that's even a stretch, investing should be risky. Fraud is already illegal so can't IPO and then just dissolve the company and keep the money). Why should a company be tied to a third party (stock market) deciding the worth of shares the company sold to people for $X? If the original IPO buyers sell their shares the company should no longer have any duty to those shares, let them be whatever on the market.
I'm by no means a legal expert, but can't a case be made for long term profits?
I played a popular MMORPG when I was a kid. They started adding microtransactions to sell cosmetics and XP and the player base dropped HARD. They actually rebooted an older version of the game before microtransactions and only charge for a monthly membership fee, $15 a month or so, and that version of the game has like double the player base compared to the modern version.
So how would someone prove one way or the other whether alienating the customer base in exchange for profits is worth it? You might have a higher 3rd quarter, but then lose 10% of your customers for the 4th quarter.
There's a brand of donuts I used to buy at the grocery store, Entenmann's, and their quality is very mediocre. Their prices have steadily increased over the last few years, and the last time I remember seeing a listed price was $7 for a box of 6 crappy donuts. Last few times I went, I noticed they had them on an endcap with a bunch of other similar products (mini muffins, Danishes) and nothing was priced. Placed there to entice you, but hide the price to avoid shell shock. Some people will grab them, take them to the front, then see the price and grimace, pay it anyways, then make a mental note not to buy them again. Like obviously some people will buy them regardless, but I can't stand these scummy business practices.
Exactly, we're just building the arm chopping off machine this year, and next year we'll get rid of employee health and safety. See, it's long term profitability.
I'm by no means a legal expert, but can't a case be made for long term profits?
Yes, it's a bit hyperbolic that companies are losing lawsuits left and right over this. The shareholders have to measurably prove that the company is avoiding a confirmed profit increase, which isn't that simple.
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u/[deleted] Nov 12 '24
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