No longer user friendly: how internet monopolies kill competition and turn users into a commodity

If you haven't noticed yet, the Internet is no longer the same libertarian utopia, a free competitive space and a launch pad with equal conditions for everyone.



There was such a time, but it has passed: the heyday of the geek era on the Internet fell on the zero years of the XXI century. The decade was the era of transition from inventors to marketers, entrepreneurs to managers, startups to corporations, competition to monopolization.



The symbolic end of this transit can be seen in 2018, when Google officially renounced its famous moral imperative Don't be evil. Instead, now at the top of Google at the time to hang the no less famous Greed is good.



The internet of romantic entrepreneurship is being replaced by the internet of big business. Instead of the good old unity "you and me are of the same blood", geek and user, start-up and user, there was a stratification into antagonistic entities: corporations against users. The very word "users" reflects the paradigm of the old Internet, when services were waiting for people who would use them. Now the criterion for the effectiveness of Internet business is the ability to keep a person in order to use it already.





Tron: Legacy: the battle of the user against the program The



modern Internet is increasingly based not on the ability to be useful to people, but to use them. Benefit for the user is no longer their main task, but a tool that helps to attract more people and keep them longer in order to use them.



The Internet is increasingly turning into a place where the main product is not digital products and services produced by the mind, labor and talent of developers, but the users themselves. Which users turn into used ones.



By itself, the deepening of the symbiosis of users and services, when it is no longer clear who uses whom, is a natural consequence of the development and complication of the Internet. The problem is the one-sidedness of the new format of relations, when corporations have already adapted and turned their users into goods, and users are still under the illusion that they are using, for example, Facebook, and not Facebook that uses them.



And all this illusion is thickly entwined with ivy of hypocrisy in order to keep it from exposure longer. Respect for users was replaced by PR. The same "Google" and "Facebook" are simultaneously involved in scandals related to human rights violations in some parts of the world (China and Myanmar, for example) - and symbolic gestures supporting the SJW agenda in others - mainly at home, in USA. The first is just a business. The second is PR. Because PR on human rights is much cheaper than following them.



But even if we limit ourselves to the very nature of the relationship between users and platforms, instead of balancing the interests of the parties, there is the complete dominance of corporations with their platforms and ecosystems.



Google and Yandex sell paid services to users, but they do not stop data-mining all the juices from them. Yandex, for example, trains the recognition of pictures in the content of personal photo albums on Yandex.Disk.



Facebook does not even hide that their business is users, not a service, not offering a paid version without ads, even optional. Free is a nice cover for an unsightly reality in which a paid user brings only a fixed income, while the ways to make money from a “free” user are limited only by the ingenuity of their managers.



Users are no longer guests at this free celebration of life in a hospitable home, but its main dish.



The most respectable approach (relative to other sharks of Internet capitalism) is from companies like Apple and Spotify, which continue to sell hardware and services to users, rather than buy for hardware and services of users to resell to everyone else. But this difference is not so significant in a broader context. All these corporations, from Google to Apple, from Amazon to Yandex, are participating in the same project to “ecosystemize” users.



Ecosystemization is the horizontal expansion of businesses to the level of multiplatforms, which are involved in as many of the daily tasks of their users as possible.



This increases the value of both the digital profile of each individual user due to the variety of types of information collected about him, and increases, in the future, the "cost" of his transition to another platform.



It's not just about transferring data as such. Companies keep users with soft power. The comfort created within the ecosystem is such that when trying to leave it - for example, replacing the iPhone with Android or Mac with Windows, the user immediately feels his loss in small details like the ease of various synchronizations. Thus, in order to move into the cozy comfort of another ecosystem - he needs to either update the entire electronics park at once - or stay “at home”.



Only the ways of involving users in this project differ - for free and with advertising or for money and without - but the direction is one.



Ecosystemisation is a digital analogue of serfdom. Serfdom also began as a kind of partnership between the landowner (platform) and the peasant (user). The landowner gave the peasant land, the peasant produced a product for the landowner, and in return enjoyed relative business freedom - for example, he could once a year “break the contract” and go to another landowner (St. George's Day).



The problem with these relations was that the individual peasant had much less influence on the landlord than the individual landowner had on the peasant.



The peasants simply did not have a choice: all the land belonged to the landowners (we are talking about all large landowners, including the Church and the tsar). And this gave the landowners every opportunity to slightly shift the balance of interests more and more in their favor, until this led to a natural result: the complete enslavement of the peasants, which actually put them in a slave position.



The same thing is happening now on the Internet: Internet corporations do not just grow at the expense of new users and businesses - they oust existing companies from the market, filling the entire space and squeezing out not only competitors, but also the very possibility of competition.



A good example of how this works is Amazon, each new sorting center of which napalm burns out all small businesses in the district. Moreover, this is not only a side effect of their functioning, but also a purposeful policy: there are cases when Amazon simply repeated the product line of the sellers presented by them, and duplicated it at dumping prices, in fact, wringing out their business niche.



Amazon can afford it not only because it is a marketplace, but also because it has access to closed information about the business processes of its merchants. On the question of the value of information and the risks of uncontrolled access to them. Jeff Bezos is now the richest man in the world.



That is, the libertarian utopia of the early Internet before our very eyes turns into its reality nightmare - a world divided between monopolies.



The very success story of these companies and their faces - from Gates to Zuckerberg, from Jobs to Musk - is also a product of PR, modern myth-making with modern gods and titans who have lifted the Earth on their shoulders solely with their mind, work and talent. These myths are based on real events, and the desired effect is achieved by ignoring details that do not fit into the narrative, which would blur the epic images. It's more natural.



These myths serve as a beacon of hope for entrepreneurs and developers around the world. Whereas in reality businesses, the history of which is steeped in the romance of the pioneers: they grew up in a garage, started in a dorm room - and achieved success - in their success have grown to such a size that it is now impossible to repeat their path. In the best case, one of the giants will notice and buy you. Now this is a new paradigm of success: not to start your own farm, but to go to the landowner more impressively.



In this sense, the invention of the Internet resembles the history of the colonization of America by Europeans (with the only difference that no one lived on the Internet before its discovery): the New World was a space of unlimited possibilities only for a time, until the empires finally divided it among themselves.



Of course, there is another side to the coin. Progress, improvement of user experience (inside ecosystems it is true that every year it is more comfortable and cozy!). Training on custom files develops neural networks. And advertisers, getting to know their consumers closer and closer, make advertising more targeted - and therefore less annoying. An ideal ad is one that doesn't feel like an ad at all, but rather seems to be useful advice given just in time. So here, too, total control of platforms is shrouded in a soft blanket of comfort that promises to reduce the annoyance of advertising.



The development of platforms, services, technologies, the alignment and deepening of communications between people around the planet is, perhaps, the main achievement of the modern world, which promises not a step, but a breakthrough in the development of human civilization.



The benefits of progress are not the problem - they are indisputable. The problem is how these benefits will be distributed in a new wonderful, much more comfortable, transparent and digitalized world.



The speed with which the communication revolution is unfolding has its price: new resources, opportunities, technologies and ways of earning money appear so quickly that the vast majority of humanity and a significant part of businesses cannot adapt to it without getting involved in a frantic race for the first cream from new markets ... This allows you to open, capture and divide new niches before the bulk of interested businesses and users come there. The longer the Internet market develops according to the laws of the wild west, ignored by antitrust regulators, the further the consolidation and strengthening of the strongest players goes, widening the gap with potential competitors.



A similar stratification occurs in the labor market, allowing specialists who have mastered new skills earlier than others to get ahead in their careers before serious competition arises in it. However, no specialist can fill an entire labor market, while companies can grow indefinitely, not only outstripping competitors, but also capturing entire markets, eliminating competition as such.



Thus, when the benefits of progress reach the majority of people, their lion's share is already sorted out by a small number of players. The uncontrolled growth of mega-corporations, the consolidation and monopolization of businesses and platforms paint a picture of the growing preponderance of one side, the corporate minority, the new Internet aristocracy that is taking shape before our eyes.



A limited number of business giants will control most of the Internet



1) as a market (that is, its users),

2) as a business (raising the price of market entry for competitors to sky-high heights),

3) as a resource (primarily financial, accumulating at its disposal - as a rule, offshore - huge monetary resources).



The problem is that all of these corporations grew up on soil that was abundantly fertilized with taxpayer money. The part that the mythmakers of the Silicon Valley titans forget about is public investment in education (Silicon Valley is rooted in Stanford) and the monetary rain of government orders that began during the Cold War and has not dried up to this day.



Runet is rooted in the Cold War in the same way as the Valley. The libertarian utopia of the 2000s Runet was built on the concrete cushion of Soviet education. A feature of investment in human capital, including education, is its deferred effect. Runet (and the entire Russian-speaking part of the Valley) is the most striking example of this effect, lifted on the shoulders of graduates (and now graduates of graduates) of the Soviet Physics and Mathematics Department.



While the Cold War was going on in politics, the same processes were going on inside both the USSR and the USA: massive state investments in universal (almost) free education and fundamental science, carried out by boring bureaucrats and strict military men. Both in the USSR and in the USA the state did it. In the Cold War, one side lost and the other won. However, both won in education and science. The difference in economic systems affected only who was able to take advantage of the fruits of these investments: in the United States, the Internet market was born from them.



The only difference is PR: in order not to destroy the narrative about a stupid, senseless and unnecessary state as a phenomenon with its disgusting taxes, the Soviet experience of state administration is presented only from the negative side, while the American one is simply ignored. Gates, Jobs, Zuckerberg did everything themselves. They built universities, gave themselves education, and financed all the projects.



And the myth stuck. The Soviet experience in many eyes devalued his political failure with the collapse of the USSR. The American experience was devalued by the massive PR myths about the Silicon Valley demiurges.



As a result, both in the United States and in post-Soviet countries for the last 30-40 years the same trend has been observed: the state - fu, state regulation - fu, taxes - theft. And the states in the United States and in Russia obediently curl up into a ball. In Russia, of course, to a greater extent than in the United States.



But the processes and results are again like a drop of water: the Russian applicant was presented with the delights of paid education and a consoling lottery in the form of a tiny share of budget places. In the United States, both the cost of education and the student loan industry have swollen like a cancer, the total volume of which in the United States has already surpassed other types of private debt, including car loans and mortgages.



At the same time, taxes for corporations are reduced (or corporations "optimize" them), and corporations themselves are enlarged. The devouring of the Internet by monopolies in Russia follows a very similar scenario: the rapidly growing market has attracted financial capital, which quickly buys up, consolidates and concentrates all living things on it. The only difference is that in Russia Sberbank is behind this capital, and in the USA - Wall Street. But the nuances in the form of more noticeable negative government intervention in Russia in no way overshadow the same as for the United States, in which, instead of the horizontal chaos of the free market, there is a strict order of vertical monopolies.



The problem is not in the state and not in capital as such. These are just tools that emerged at different times to solve different problems. A businessman and a bureaucrat are not interchangeable, so that you can simply hand over the functions of both business and government to only one of these institutions. Attempts to do this lead to distortions in the system and the effect of a pendulum that follows it: fleeing from the terrible dystopia of soulless totalitarianism and ineffective bureaucracy, the political course in both Russia and the United States has turned sharply to the right - in the hope that pragmatism and “effective management "of capitalism. Which, of course, is effective in its work. Only this work is making a profit. And its preservation - preferably in the hidden booths of a tax haven on some islands.



State policies of the Cold War era on both sides of the ocean from the late 1940s to the late 1970s bore fruit. Since the late 70s in the USA and the mid-90s in Russia, we have seen the flourishing of one of the main things - the Internet and digital communication in general.



The USSR collapsed, America changed. People who got the opportunity to study in Soviet and American universities, not knowing the delights of paid education and student loans, stayed and built the modern Internet. But now the fruits of their labor are concentrated in the hands of corporations. Those who see education as another source of income, and love the free market and competition only as long as they do not get ahead in it.



However, a holy place is never empty: while Russian education is dying out, and American education is increasingly being replaced by imports of brains, China is growing up in the east. By the way, this is also a curious example of how the Chinese miracle is explained by the transfer of production from Europe and the USA to the colonial rates of the Chinese labor force, and the huge investments of the state in science and education for some reason pass below the radar. But their fruits are already sprouting: now only Chinese state-owned companies can compete with American private corporations in the global market. Moreover, China in this competition is on the ascending line, the United States is on a flat one, and it is even a shame to compare Russia with them.



And again, this is not about comparing systems. The antagonism of capitalism and socialism, in many ways, was forged in the furnaces of a propaganda war. Both countries had to prove their superiority - and they did it as best they could. The experience of China over the past 30 years, as well as the experience of America until the end of the 70s, shows that the formula for success is public-private partnerships. Where the state invests in infrastructure, science and human capital. Business thrives on this soil, creates wealth - and, in theory, pays taxes to keep the cycle going.



As a result, the Cold War ended with one country losing and the other believing in its propaganda. And both, failing to notice that the rise of the digital industry in the 1990s and 2000s was a delayed effect of public policy on education and science in the 1960s and 1970s, this policy was abandoned.



The difference between the state and business is not in "efficiency", but in different planning horizons. Businesses need to report their profits annually. The state can and should invest in projects with a return expected in decades. Even the largest corporations in the world lack such planning horizons. Therefore, when the state believed that private business would pull out education and science, there was no one to do this on the same scale. And the business just saw a new unoccupied market, starting to monetize it with enthusiasm and make a profit. It makes no sense to ask what this is leading to a generation later in business: they will not even understand the question. In order to invest in science and education at the level of the USSR and the USA in the past and China today, private business has neither the motivation nor the money in such quantities.Long-term investments in education are the task of the state, also because they require government spending.



The inertia of “government intervention” in education and science 50 years ago was enough to reach 2020. Now the delayed effect of its curtailment in the last 30 years is next in line.



The privatization and capitalization of the Internet business threatens not only to kill everything geeks love the Internet for: an environment of equal and unlimited opportunities. The privatization and capitalization of the Internet business threatens to burn out the very soil on which it has grown.



Frightened by the terror of the total state, the pendulum of history swung in the direction of deregulated capitalism. The horrors of government intervention ended up being exaggerated, and the wonders of the free market had side effects that people weren't warned about.



However, the choice has never been limited to the two polar options - and is not limited now. The very paradigm "either one or the exact opposite" is only an artifact of the Cold War.



People were so afraid of the state that they rushed into the arms of their guys from garages. Take garage entrepreneurs and grow. Instead of the kind geeky "Don't be evil" Google zero people were met by a soulless machine of a transnational corporation, which is now absolutely not embarrassed by any evil. Evil, which had a good effect on the stock price, is good. And without the state, people were completely defenseless in front of her.



While the candy-bouquet period has not ended yet, the possibility of an offended tweet or a devastating publication in the media to force multinational corporations to change their course in any trifles still remains.



When it ends, corporations will have:



1) all major platforms - content, service, trade, communication,



2) probably - control over communication channels (the US net neutrality law has already been canceled),



3) all server capacities and stored data ( with the proliferation of 5G, most of the personal archives will be stored online, accessible only to the user and a huge corporation, but to no one else);



4) all the data of all Internet users in most of the planet (maybe, with the exception of China. But there are their own corporations), including non-public data, such as the contents of personal "clouds". Another great soothing metaphor for digital ecosystemization. "Clouds".



5) All money earned by their monopoly position, carefully stored in offshore accounts.



6) Control over user access to the platforms they control and users' freedom of speech on them.



7) Influence on the media, either already purchased from the same pockets that own Silicon Valley, or desperately dependent on big business as advertisers and a source of traffic. The media is leaving for the audience on social networks, social networks are owned by corporations, corporations are turning into monopolies - what can go wrong?



To prevent this, it is time to slow down the pendulum and swing it back.



Not to the fullest, until the USSR of the 70s, and not even China today - the USA of the 60s will be just right. The Internet we talk on today grew from there.



The alliance of users and Internet businesses grew out of a general distrust of the state. Now that companies have grown into corporations, a direct antagonism between corporate interests and user interests looms in place of the former alliance. And in order to prevent the transformation of Google and others like it into real corporations of evil, redistribution and cementing of the Internet market and digital enslavement of the majority of users, it is time for those who play on the side of users to reconsider their attitude towards the state.



The state does not have to be the enemy of man. In democracies, the state can and should play the role of a collective advocate.



For example, the European Union is trying to protect user privacy and regulate monopolies.



In the US, regulation of user relations is left to the monopolies themselves.



In Russia, the state and capital have grown to such an extent that, instead of regulating monopolies, it jointly saws with them everything that a saw can reach.



There is no democracy in China, and advances in the development of science, industry and high technologies are burdened with digital totalitarianism.



There are a huge number of things that states are doing, stopped doing, or can do to prevent progress from slipping in the rut of consumerism and stock indicators. Break the monopolies. Return taxes from offshore companies. Invest in education and science at the level of the "space race" era.



For this to happen, users must become aware of their interests. Realize that the warm feeling of ecosystemization and corporate amalgamation is milk just starting to heat up around the frog.



That the interests of corporations are no longer only not parallel to the interests of their users, but increasingly antagonistic.



That the monopolies themselves do not demonopolize themselves, they will not share the captured markets, they will not pay taxes on the profits taken away - only the state has the resources, experience and authority to do this.



That to think about education and science before the fruits of the previous scientific and technological breakthrough are finally eaten away, is also affordable and within the power of only the state.



The idea of ​​completely trusting the state in the past did not come true. The idea of ​​completely trusting business is reaching a dead end before our very eyes. To get off this crazy swing, people need to stop believing in the monochrome ideologies of socialism and capitalism - and learn to see the strengths and weaknesses of both approaches.



It is necessary to use both the benefits of consumerism and the protection of the state - but at the same time not trusting either big capital or big brother.



The good news is that right now, for the first time, humanity has a tool of mass education, organization and action in one - the Internet. Until now, most people are in it as users.



And while most people are only getting more comfortable and comfortable in it, the Internet monopolies should not be allowed to privatize the most important invention of civilization since the days of writing in exchange for improved user experience and increased space in the cloud.



PS If someone can undertake to translate this article for the English-speaking Habr - please write in a personal.



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