How are lemmy and other fediverse platforms profitable?
Reddit migrator here (shocking, I know)
Just wondering because I found out about all this yesterday and just realized the ammount of independent servers, but no sign of any ads or sponsors. So... is it all based on donations?
Also don't just lurk, if you know you should answer because lemmy only counts users who posted or commented as active users.
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Things can be valuable without being profitable. A hug from someone you love does not generate any profit but is still a good thing that should exist. Likewise, a community resource like a Lemmy instance does not need to justify it's existence by being profitable. It can simply exist as something that people get value from. The fact that we often lose sight of this is a result of living in a capitalistic society that over-emphasises the value of something producing profit and underemphasises any other possible value. As for the implied question of, how does a Lemmy instance get the money to pay the costs required to run it? That's going to vary from one instance to another and how that money is raised should be a factor in which one you sign up to and which ones you connect with. In the case of Lemmy.world, it is, afaik, presently (and likely in the future) run as a non-profit for it's own inherent value and is funded by user donations. A big point of federated communities is to allow those communities to be able to operate for their own benefit, rather than be reliant on commercial investment that will later create a tension of different incentives.
I don't think a hug was a good example, for the exact reason you mentioned in the second half of your comment. A hug does not cost anything to give, other than a small amount of time. Everyone gets time for free, until they don't anymore.
Servers cost money AND time, both to get and run the equipment. Not to mention regular maintenance as hard drives especially don't last forever. It's easier to do something unprofitable for the sake of it being a valuable thing, such as picking up trash on the side of the road. But most people can't just give shoes to the homeless because it's a good thing, simply because that costs money and time, which the average person does not have an exorbitant amount of money to give away.
To me, the question is moreso how do lemmy instances get the money to exist, and OP just used the wrong word. Which as you mentioned, through donations. I also think it would be a pretty neat feature to have a setting where you can enable ads (off by default) to further support the instance without having to directly enter your credit card information.
Yes it is.
That is not the same thing as making a profit.