«Markets have been “replaced by digital trading platforms which look like, but are not, markets”. The moment you enter amazon.com “you exit #capitalism” and enter something that resembles a “feudal fief”: a digital world belonging to one man and his algorithm, which determines what products you will see and what products you won’t see.
If you are a seller, the #platform will determine how you can sell and which #customers you can approach. The terms in which you interact, share information and trade are dictated by an “algo” that “works for [Jeff Bezos’] bottom line”.
The capitalists who rely on this mode of selling are granted access to the digital estate by its virtual landowners, the Big Tech companies. And if “vassal capitalists” don’t abide by the laws of the estate, they are kicked out – removed from #Apple’s App Store or #Google’s search index – with disastrous consequences for their business.
Access to the “digital fief” comes at the cost of exorbitant rents. Varoufakis notes that many third-party developers on the Apple store, for example, pay 30% “on all their revenues”, while #Amazon charges its sellers “35% of revenues”. This, he argues, is like a medieval #feudal lord sending round the sheriff to collect a large chunk of his serfs’ produce because he owns the estate and everything within it.
This is not extracting profit through the production or provision of goods and services, as these platforms are not a “service” in the sense in which the term is used in economics. They are extracting rents in the form of the huge cuts they take from the capitalists on their platforms.
There is “no disinterested invisible hand of the #market” here. The Big Tech platforms are exempted from free-market competition. Their owners – “cloudalists” – increase their wealth and power at a dizzying pace with each click, exploiting a new form of rent-seeking made possible by the new algorithmically structured digital platforms. Parasitic on capitalist production, they are now dominating it.
But something even more transformative has happened, Varoufakis argues.
Even though most of us are regularly interacting with capitalists and earning wages via our labour, now, for the first time in history, all of us contribute to “the wealth and power of the new ruling class” through our “unpaid labour”.
Every time we use our cloud-linked devices – smartphones, laptops, #Alexa, Google Assistant, #Siri – we replenish the capital of the Big Tech cloudalists. This in turn increases their capacity to generate more wealth. How? We train their algorithms, which train us, to train them, and so on, in a feedback loop whose goal is to shape our desires and behaviour. They are “selling things to us while selling our attention to others”.»
https://theconversation.com/is-capitalism-dead-yanis-varoufakis-thinks-it-is-and-he-knows-who-killed-it-213992
