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Common Wealth: To #MakeAmazonPay, Reimagine the Platform Economy

Another digital world is possible — democratic, and just by design.
Common Wealth is a think tank for the future, building models ownership for a democratic and sustainable economy. Today, they join the Progressive International and its campaign to #MakeAmazonPay.
Common Wealth is a think tank for the future, building models ownership for a democratic and sustainable economy. Today, they join the Progressive International and its campaign to #MakeAmazonPay.

The platform giants occupy the commanding heights of the contemporary economy. Their logic of expansion, enclosure, and extraction drives our new age of rentier capitalism. Platform technologies colonise everyday life, turning the whole of society into a single digital office and factory, a vast dragnet for the upward accumulation of wealth and power. If we are serious about our commitment to “Make Amazon Pay” – to building a future of shared digital plenty – we must reimagine the platform economy.

The scale of the “Big Tech” giants like Google and Amazon appears awesome, with the platforms wielding extraordinary influence over our economies, cultures, and political systems. The “Big Five” – Facebook, Apple, Amazon, Microsoft, Google – represent around 20% of the market cap of the S&P 500, and companies like Uber, Lyft, Airbnb, and Paypal are all worth tens of billions of dollars. As the value of these tech giants has surged during the Covid-19 pandemic, the wealth of their major shareholders has exploded. Jeff Bezos, the founder of Amazon, for example, has seen his personal fortune rise by more than $73 billion since the start of the crisis to a record of around $200 billion.

Despite the fact that platform workers build that wealth, they are denied their share, often by brutal means — from Uber drivers denied basic labor rights to Amazon workers exposed to Covid-19 at fulfillment centres.

Transforming the platform economy requires that we understand how it operates. As a business model that facilitates interactions between different sets of users, the platform is not new. What has enabled today’s platform giants to accumulate such extraordinary wealth and power is a combination of the effects of digital connection and anti-competitive action.

Operations of digital platforms are quickly scalable once in place, allowing them to operate across the world without having a physical presence in any particular country. That makes it possible to create network effects, which occur when the value derived from using a platform depends on the number of other users using it, incentivising concentration and consolidation. As a result, leading platforms have an in-built drive toward monopoly.

Boosted by limitless flows of venture capital (VC), these platforms corporations have acquired a dominant position across more and more parts of our economy, from search to online retail and from social networks to mobility services. Moreover, this power is consolidated by a key feature of the platform economy: the exponential collection, analysis, and monetisation of data generated by platform users and collected by the platform companies. As the vanguard of “surveillance capitalism”, they mine all aspects of life for data, which is not only bought and sold, but also used to modify our daily behaviour.

This has led to a situation in which a small group of large platform companies – sitting at the heart of the transactions and engagements of the digital, and increasingly, the physical economy – have become the rentier giants of our age. Their main focus has become the collection and defense of rent from competitors and regulators alike.

Increasing inequality flows from the platforms’ monopoly power. Many platform workers lack social and labour protections that others take for granted, while the deployment of technologies extends new, pernicious forms of social and workplace control. Social media platforms stand accused of undermining of democratic and civil norms through the proliferation of misinformation, while the rise of algorithmic management hardwires racist bias into the core infrastructure of our economic system. Meanwhile, platform companies use regulatory and tax arbitrage (e.g. shopping for favourable regulatory environments) to boost profits, at a cost to local economies and working conditions.

But if monopoly power is generating severe social crises, the extraordinary potential of digital platforms remains. As an infrastructure for connecting people to goods and services, platforms can and do provide an enormously useful function and — as Covid-19 has shown — they are indispensable to how we live, work, and play. In their collaborative and networked nature, platforms can usher in a new world of equity and participation, based on multi-stakeholder models of governance and ownership, giving workers and users of the platform genuine voice and control.

The challenge is to liberate the democratic potential of the platform from the logic of rent extraction. While the Big Tech giants want you to believe that they are permanent features of our digital lives, the future of the digital economy is neither fixed nor certain. Platforms are legal and political as much as digital institutions; we can recode both and change how they operate and in whose interests.

Central to this must be a new architecture of ownership and control and a 21st century deal for workers everywhere. A new report by The Democracy Collaborative and Common Wealth sets out to imagine just that.

Our demands should be based on five clear principles and policy agendas.

First, democratic data management. Decisions on whether to collect data, what data to collect, and how data can be used should not be left in the hands of private corporations or the state as presently constituted. Rather, new democratic and multi-stakeholder organizations and approaches are needed.

Second, a new digital commons. Platforms and data should be reconceptualized as public utilities and assets with new public and commons forms of ownership and governance, moving from conditions of private enclosure to a democratic commons for our data and digital infrastructures.

Third, equity from South to North. Any proposals to democratize the ownership and control of platforms and data must take global dynamics into account and establish a process by which people and communities from around the world (and not just those in the Global North) can meaningfully participate. Fundamental to this must be a new deal for all workers that guarantees rights from day one, trade union voice, and a living wage for all.

Fourth, comprehensive anti-trust. While reducing the monopoly power of Big Tech and platform companies is central, we need antitrust strategies that are connected to deeper structural changes in the ownership and control of platforms and Big Tech companies. Anti-competition efforts taking place in European Union, the United Kingdom and the United States all need to be rooted in principles of economic justice.

Finally, economic justice is inseparable from environmental justice. An agenda for reimagining the platform economy must ensure the power of digital technologies accelerates efforts to address the climate and nature emergency.

Another digital world is possible, and urgently needed. The Big Tech monopolies are poised to dominate our economies for another generation if we do not challenge them directly, powerfully, and globally.

The campaign to ‘Make Amazon Pay’ must send a powerful message to Jeff Bezos: we are taking back the platform. Our challenge is to liberate the potential of platforms like Amazon to connect, communicate, and coordinate. And to do that, we need an ambitious agenda to transform who owns, operates, and governs these platforms. Together, we can build a digital future that is democratic and just by design.

Mathew Lawrence is the Common Wealth director.

Image: Common Wealth

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Author
Mathew Lawrence
Date
02.12.2020

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