Simple Systems

Zeit just released a crazy new pricing model for the Now hosting service.

Under the new model, users don't pay more for increased usage. That's insane, right? They're a hosting company. The entire service is just renting computers. Users should pay based on how much they use those computers!

Nope.

This new model is a vast improvement. The crucial benefit is its simplicity. It's impossible to get confused. It costs $20/month per seat, and it's free for individuals. That's it.

Is this totally fair? Probably not. Not every customer will be charged exactly the right amount. But that's okay! The value of simplicity (for both consumers and for Zeit internally) far outweighs any of the downsides.

What about customers who are being overcharged? Not a problem. Simplifying the system frees up time that would usually be spent on customer support and billing. This saves money, and that money can be used to round down the price of the service. Even the people paying the most relative to their usage will be paying a fair price because the simplicity of the service allows it to be cheap for everyone.

This is the same reason that Universal Basic Income is an excellent idea. By simplifying the model for distributing money to citizens, resources that would usually be spent on management (such as means testing) can go directly to the people.

This is also why a basic income must be unconditional. It's easy and fun to argue that Jeffy B should not receive basic income, but the overhead that's introduced as soon as qualifications are added completely destroys the simplicity of UBI—its primary benefit.

The simple system always wins.

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© 2020 Josh Pullen