We will need small and independent commercial providers for the Fediverse.
Same can be said about Reddit, which is free to use. Having to pay to use Lemmy increases the barrier to entry even further
I think the deal is, you either pay cash or you pay with your data. While it definitely does increase friction for new users (and even existing users as finances fluctuate), a donation based system might be worth it. Something like wikipedia, archive.org, and other NPOs do. Incentives might be possible too, creating goals for getting X amount of donations to fund a specific improvement. It increases interest by defining a product or improvement, and increases buy-in by giving the donor the sense that they’re directly improving the site through their donation.
The web3 community (and the area that I specialise in) hasn’t really gotten deep into the fediverse yet, but there is actually some decent room for opportunities here.
An obvious one will be users sign up by locking up collateral to access a Lemmy instance, with the yield going to the admins. Users lose access by pulling out their principal and moving on.
