Any non-excludable goods, which includes public goods (which are also non-rivalrous) are very difficult to profit from. These include lighthouses, laws, national defense, clean air and water, a sustainable population of fish and game, and so forth.<p>I say "very difficult" because search engines, for example, are non-rivalrous and non-excludable in practice. They are "public goods". The trick is, access to the attentions of and data generated by search engine users <i>is</i> excludable, and this is the good that Google actually sells. But any sort of non-excludable good from which your consumers cannot generate an excludable good you can sell for others would be unprofitable.<p>Programming languages (mentioned by another post) are another good example of a public good: they are non-rivalrous, and while they may be excludable as long as you sell the only compiler/interpreter/runtime and sue everyone else who writes a different compiler/interpreter/runtime, in practice no one will pay for a programming language anymore so you have to make it non-excludable for it to even exist in the outside world. Likewise, Google is probably excludable in the sense that they can set up a paywall before you use it, but in practice Google has chosen to make the search engine non-excludable and it's hard to see how a paywalled search engine would work (though I won't rule it out as a possibility).
"Make something people want" is primarily valuable as a negative test:<p>You probably <i>won't</i> profit if you make something people <i>don't</i> want.<p>But making something people <i>want</i> doesn't correlate nearly as well with whether or not your product is commercially viable.
Programming languages and tools.<p>There are some counter-examples (e.g. Franz, LispWorks), but I think it's best to just consider this sort of work a labor of love.
We really need to remember that "make something people want" is a specific piece of advice relative to building a product. We get all giddy about this advice because as programmers, that's what we love to do; <i>build things</i>. But a business depends on many many more things than just your product. I'd argue that a company's product is, at max, 30% of what matters to the profit-generating system as a whole.<p>So to answer your question: it is irrelevant. And I encourage you to separate "product" from "profit". Because if you want to make profits, you need to master business and marketing. Making products is for those programming guys. The great thing about HN, is that we think we can do both ... and we can! - Just remember that they are different hats for a reason.<p>=)
What I've found is that there's almost always <i>some</i> people that want any particular thing. The two <i>really big</i> questions are 1) How many of them are there? 2) Can you make money off them?<p>#1 is much tougher. If you're in a niche inside a niche inside a niche and you end up with 10 paying customers sending you $20/mo it's technically "working", but too small to be worth it.<p>#2 is easier. The situation Twitter is in. They have tons of users and now it's purely a matter of ingenuity to come up with a way to profit in a big way.
It depends on your definition of profit. You can make something people want and end up with a business that makes $10K profit, but you won't be quitting your job to run that business.
Fully on demand cable television. So many people tell me "I'd love it if I could just pay per channel and forget about the other channels."<p>That got me thinking it may be something to exploit. Not so, with infrastructure costs swallowing up so much of the potential profits. People will just have to deal with all the channels they end up paying for. So, it's either the internet or bust if you don't want to play the cable game.
<a href="http://mbusreloaded.com/umbus" rel="nofollow">http://mbusreloaded.com/umbus</a> -- several hundred people use it every day, all of them cheap/lazy college students who aren't going to pay for the privilege. The value of advertising on the system seems to be barely greater than costs (a few tens of dollars per month) and the current advertiser is behind on payments.
Jury is still out, but free/freemium music services look hard. (People don't seem to want subscription services.) lala sold allegedly because they weren't getting to profitability fast enough, imeem struggled, and Pandora needed an act of the United States Congress to deal with sharp increases in streaming royalties.
A huge thing to note, even with a large number of unprofitable cases, is not that the YC mantra is flawed, but more likely systems may not yet be in place to facilitate profitability. For example, if there were an awesome micropayment solution I'll bet a lot of currently unprofitable sites could find profitability.
Amazon is losing $2 on each e-book. Sometimes forward thinking innovations take a while to get profitable. Sometimes the market is too small. There may be 5 people who want it, but it costs more than they can afford.
Wikipedia needs 7mm in donations but only has raised like 2mm so far.<p>Hiphopgoblin had a bunch of people who proclaimed their love for the site, but I doubt any one of them would have paid cash for it. Maybe I could have cooked up some sort of new media advertising plan had I realized enough traffic, but I decided to abandon..<p>People's love is a revealed preference when they vote with their wallets.