// HACKER NEWS — CYBERSECURITY
The TEMU-Fication of Software, Digital Goods and Services
A hypothesis on the not-so-distant future of software, books, music, and
movies, in which most of what we consume gets cheaper, more abundant, and
noticeably worse, while the human-made variant moves into a luxury
segment of its own.
Disclaimer: This is an opinion piece and most of it is speculation about a
future that has not arrived (yet?), based on a few data points that have. As
usual, summary at the end.
A few years ago I would have laughed at anyone telling me that there is a
serious market for ten-dollar drills, two-dollar dresses, and one-dollar pairs
of shoes shipped from a warehouse on the other side of the planet. Today,
however, that market exists and it has a name, and it is even publicly traded
(sort of, through holdings). TEMU, Shein and a few others have built frankly
mind-boggling businesses around the idea that if you make production cheap
enough, fast enough, and just barely good enough to look right on a phone
screen, an enormous part of the population will buy it, even when the product
breaks within a week, when the materials it is made of contain worrying levels
of toxic substances, and when the carbon footprint of one
delivery exceeds that of an equivalent local purchase by orders of magnitude.
The key to this sort of business model is not innovation, but instead the
externalization and compression of cost. Somewhere upstream,
people work seventy-five hours a week, in conditions most readers
of this website would refuse to even visit, so that the rest of us can have a
cheap plastic spatula at our doorstep within five business days. While the
visible price collapses, the invisible costs get distributed onto landfills,
lungs, and ultimately people that we will never meet.
What follows is a hypothesis I cannot prove but have been turning over in my
head for a while, as we are watching the same thing happen to software, books,
music, (film-)scripts, and most of the digital goods and services we consume.
The cheap labor in this case is not human, it is a Large Language Model
(LLM), or what many people these days call “AI”, and the externalized cost
is, among other things, quality, which requires craftsmanship to produce, and
attention to perceive. And just like with physical goods, we will probably end
up with a two-tier market, in which we have a large and massively profitable
lower tier of generated slop, and a smaller, more expensive upper tier of work
that is still recognizably human.
I’d like to call this the TEMU-fication of software, digital goods and
services, and describe what it might look like.
For decades, the global fashion industry has relied on a workforce that has
almost no leverage and no voice, and for which the economics work because
someone, somewhere far away, will sew a t-shirt for less than the price of a
coffee. Without that skewed arrangement, the entire fast fashion business
model collapses. The garment in your hand is only cheap to you because it has
been expensive to someone else, in ways that the price tag does not show.
Modern Large Language Models occupy a similar position in the economy, with
one important difference, which is that there is no human being in the
sweatshop, only a stack of GPUs trained on a corpus of work that other human
beings produced over the course of decades. The labor that has been compressed
is historical and the model is a kind of compressed copy of the work of
millions of programmers, writers, illustrators, and musicians, served back at
near-zero marginal cost. Well, at least in theory, and only if the
hyperscalers find a way to lower the cost per token, but that’s a different
topic.
However, the result is the same. A class of goods can suddenly be produced for
an order of magnitude less than before. And, just like with TEMU,
those goods turn out to be just barely good enough.
The most direct manifestation of this so far is what is being called vibe
coding. The term refers to the practice of describing what you want in natural
language to an L