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One of the most interesting insights to me about this dynamic of profitless, innovation lacking platforms came from reading a Varoufakis piece. To him the reas
by Barrin92 5y ago
One of the most interesting insights to me about this dynamic of profitless, innovation lacking platforms came from reading a Varoufakis piece.
To him the reason platforms exist as they do right now is because they constitute a fundamental shift away from market capitalism to what he calls techo-feudalism.
Instead of thinking of companies like Uber as selling software and paying wage labour to generate profit, it makes much more sense to think of it as a fiefdom that extract rents directly from its users outside of markets, maintains unpaid or barely paid labour, essentially a techno-peasant class, and is funded by barons in the form of VC capital directly and the state indirectly.
Through that lens for the first time to me it made perfect sense why it isn't so absurd to have gigantic companies that barely make any profits, have no differentiated products or much of a workforce. The point of these new businesses isn't to dominate markets and sell things at great margins, it's to claim territory, extract value and then use that control to directly command users on your behalf.
https://metacpc.org/en/crypto-blockchain/ https://metacpc.org/en/crypto-blockchain/
- totetsu 5y agoTecho Serfdom.
- cuteboy19 5y agoThe 3rd paragraph is incongruous with the 4th paragraph. If they are not generating profits then how come we accuse them of extracting rent and "maintaining techno-peasants"? The major characteristic of feudalism was that power centers deteriorated and power was distributed to local lords insted of central kings. So how is having a single gigantic company more like feudalism? Lastly, why come up with such convoluted theory when "too much speculation due to cheap debt" explains everything with much less gymnastics
- Barrin92 5y ago> If they are not generating profits then how come we accuse them of extracting rent because those are not the same thing. Feudalists don't extract surplus wage labor, they extract direct tribute from their subjects, and just like that the entire value of Facebook say, is in what its users produce on its platform. That experience is the actual rent they collect. Ever wondered why all of this stuff is free? And power is deteriorating. Away from the state, which played a central role in organizing and managing the traditional market economy towards these private spheres of influence of which the principal unit is the tech-firm.
- cuteboy19 5y agoI feel like my mother posting about some cauliflower recipe would be much less useful tribute than a few kilos of rice. There must be some point to the tribute. This stuff is free because Facebook is an advertisement company. I enjoy a good conspiracy as well but at least it must be somewhat entertaining.
- spacebanana7 5y ago> If they are not generating profits then how come we accuse them of extracting rent Just as it was possible for a medieval king to have terrible finances by spending more on war/security than he collected in rent from Barons, a tech company can lose lots of money by spending more on customer acquisition/platform maintenance than collected in rent from suppliers.
- spacebanana7 5y agoI think this phenomenon is better described as indirect payment for platform services. You could argue similar structures exist outside of tech in Walmart’s supplier relationships or Standard Oil’s railroad arrangements. Also, the methods used by these companies to “claim territory” often does seem to create innovation. The gmail web app, WhatsApp etc create a lot of customer value despite being used for territory expansion rather the collection of direct revenue.