This is a continuation of my series, The Silicon Valley Problem. In Part One, I discussed the semantics of content and the subordination of creative works; Part Two was about the implicit biases in algorithm design.
A year ago, I was sitting in the delicious and locally-owned Aqus Cafe in Petaluma, enjoying my lunch and a local California export, while composing a blog post that I thought was lambasting Prime Day, a consumer holiday drummed up from the aether to generate profit for Jeff Bezos. Looking back on that piece, it's remarkably cagey about how I really feel regarding his company, and so it's only fitting that this year, on this most prosperous of holidays, I correct the record. I concede that Amazon is not a Silicon Valley company formally, but its business model is as close to "move fast and break things" as they come, and the nature of this company perhaps best represents the problem I'm addressing.
In this piece, I attest that Amazon and Google, though they do not fit the traditional definitions of monopoly, create something more or less consistent with that concept by depriving the consumers of their powers under capitalism.
The Insufficiencies of the Old Model
The current definition of a monopoly hinges on proving two distinct components: 1) Control of the market, and 2) Abuse of that control. This is to say that merely having control of the market is necessary but not sufficient to warrant breaking a company up; one must also prove that the company has used that power to exclude competitors, to raise prices on consumers, and so on. The exploitative aspect of the monopoly was critical to this definition because to remove it would be to consider every new innovation a dangerous market power, which isn't the case.
This necessity for actual exploitation does, however, create a gaping loophole in assessing the leveraging position of a possible monopoly. It dates to a time when the largest companies dealt in infrastructure or natural resources--coal, oil, railroads, et cetera-- and did little else. Of course, that's not how things work anymore. Google isn't just a search engine. Amazon isn't just an online bookstore. Both of these companies are spread across all spectra of technology, logistics, data-handling, innovation, social media, brick-and-mortar retail, and so on. Today's megacorporations don't exist because they've exploited a single sphere of the economy to its max, they exist because they've taken large enough portions of all aspects of the economy, and we lack an appropriate definition for this kind of power.
Each market in which Amazon or Google operates can be said to be individually competitive--for every Prime Video, there's a Hulu, for every Google Search, a Bing--but the companies in question have enough of a market share in each sphere that their combined power far exceeds the sum of their parts, enough to deny the public:
The Consumer's Tool(s) under Capitalism
The idealists of capitalism like to say that the consumers have the entirety of the power. Whether this is true or not in practice (it's not), at least in theory we can say that the failure of a business to provide an adequate product or service for the consumer will constitute an ultimate failure of the business itself, that the will of the people will overpower the will of a company.
For many institutional and systemic reasons, this doesn't exist in practice; nonetheless, under such a hypothetical economy, the consumer would indeed wield all the power, but all that power, theoretically endless, is actually vested in only one tool: the boycott. If a product is inferior, the consumer moves on to a different producer; if a product is superior but comes at a high price (economic or ethical), the consumer moves on again. What is a strike if not the consumer (of employment opportunity) boycotting the producer (of employment).
The only weapon the public has in the coliseum of capitalism is the ability to turn its back, and thus in order to prevent the subjugation of the consumer to the whims of the corporation, the power of reasonable boycott must be preserved.
Defining the Power of Reasonable Boycott
I define the power of reasonable boycott as follows: The ability for a person or people to boycott a specific company without a significant and unreasonable disruption of their life. Far from arbitrary, this definition is implicit in the traditional understanding of the monopoly: When monopolies were centered on natural resources or major infrastructure contracts, they came with an inherent inability to be reasonably boycotted. One couldn't boycott Standard Oil, for instance, without being unable to drive their car or heat their home.
How Amazon Threatens this Power
Just like last year, I'm composing this article while sitting at the delicious and local Aqus Cafe in Petaluma. Nothing has transpired in the last year that has convinced me to take my business elsewhere: Aqus is convenient, locally supportive, and tasty. However, if that changed, I could exercise my power of reasonable boycott and walk down the street to a different cafe.
I've tried for years to boycott Amazon. A long time ago I cancelled my Prime membership. Then I stopped ordering things through their site. Then I stopped using the Kindle App. The problem is, I still watch Netflix, file with TurboTax, and use hand lotion. If I were to truly boycott Amazon, I would also have to boycott the companies that use its cloud computing Amazon Web Services, including (among literally thousands of others):
- Netflix
- Unilever
- Adobe
- Airbnb
- General Electric
- Kellogg's
- BMW
- Autodesk
- Canon
- Comcast
- Hearst Corporation
- HTC
- Intuit
- Johnson & Johnson
- Lyft
- Spotify
- Nordstrom
- Pfizer
- Samsung
- Siemens
- Scholastic
- Slack
- Yelp
- NASA
- Zillow
This doesn't include Whole Foods, now part of Amazon's retail enterprise and whose discounts given to Prime members feel somehow like self-dealing, or the US Post Office, which now delivers 40% of all Amazon packages and profits while doing so. Oh, and that link is to an article from The Washington Post, which, while not owned by Amazon, is owned by Jeff Bezos, along with many, many other companies.
Boycotting a company this large becomes impractical if not entirely impossible, and would require boycotts of everything from diapers to cereal to newspapers to parts of the federal government. And we haven't even gotten to Alphabet.
Alphabet, Facebook, and the Superficial Boycott
Okay, this subhead says Alphabet only for the humorous juxtaposition with the sentence just before. Obviously Alphabet has its fingers in all the pies just like Amazon does, and fulfills all of the criteria above for an impractical or impossible boycott, but I want to specifically talk about Google.
What Google (and to a lesser, though more visible extent, Facebook) brings to the table is an interesting combination of the old and new definitions of monopoly. A transgression against the consumer's power of reasonable boycott as well as the cornering of one specific, powerful natural resource: data.
If I were to choose to boycott Google today (setting aside how tangled and complicated such a boycott would be), it wouldn't change the fact that I've been a user of the platform since it began collecting my data. That data is out there to be used, never to be recaptured. This creates an unreasonable boycott simply due to the fact that it's a superficial one--I've ostensibly stopped using Google, but my patronage at any point in Google's history means that the data I generated can be sold and re-sold long after I've left the platform.
Facebook now allows you to delete the data it has on you, but this is both a relatively new function (as of 2018), and is limited to Facebook itself, and not the data you've given third party apps that use the platform, regardless of whether that third party data was used legally or otherwise. Google allows you a similar option, but in both cases the process is limited and complicated, and one should not forget that it took a foreign power meddling in a presidential election to bring about in the first place.
Conclusion
I pick mostly on Amazon today because it's Prime Day, and thus a day prime for pointing out that the power megacorporations have over our lives is truly unprecedented. Traditional notions of monopoly no longer apply, as each of these corporations faces competition, however minuscule, in each of the areas in which they operate, and yet because their fingers are in so many pies, the fundamental power to affect capitalism shifts inexorably away from the consumer. Without the protection of the one tool we have, the power of reasonable boycott, consumers have no recourse against the companies that, while they may not display traditional exploitative behaviors, are nonetheless in a position to act with relative impunity, knowing that a boycott of the most obvious of their products will still yield income in others, and that a complete and total boycott is impossible and highly disruptive.
I won't stop anyone from using Amazon or the companies that host with them (hell, I'm listening to Spotify right now), but I will urge caution. Use Amazon conscientiously, not merely as a way to get the hottest no-Black-Friday-but-totally-Black-Friday deals.