Think about Amazon. They operate a so-called multisided platform. Thousands of producers can offer their goods and many hundred million customers can buy. While the company Amazon also sells their own goods, they make more money from fees they charge external producers and sellers. In theory, everybody could profit, there could be equal opportunities for sellers, consumers, and Amazon: sellers get a huge customer base, consumers get cheaper prices due to competition among the producers. And Amazon takes a fee and profits when the other two parties profit.
But Amazon is a corporation that must maximise profit, and they can because they control the platform. Retail is a business that doesn’t produce great riches and Amazon has a high-cost structure. They use their power and reap the benefits of the network effects on their own. One example: external producers and shops sell novelty products on the platform. They carry the risk of creating sufficient demand for their products. Amazon waits and analyses which product sells well. Then they start selling it themselves, positioning it better than the smaller external sellers. They abuse their power and destroy sellers. Fewer sellers, less competition, higher prices. And in the end, the consumers get a bad deal as well.
This doesn’t happen because Amazon is evil. Every other company of their stature would do the same. All enterprises are created by humans, and humans follow incentives. Equality and fairness are not among Amazon’s incentives. They will permit them it if they fit their needs for profit maximisation. But they will cut them when under pressure.
We want a platform and an economy where every participant is equal, where no one controls the benefits, where the experience gets better with every new participant. We want an economy where the Amazons of the world can participate, but not at the expense of everybody else.
We believe that the next iteration of the global economy will be based on cooperation. People are already getting angry at the most widely used platform in history: Facebook. This social network will very likely crumble and give way to one that doesn’t own our data, that doesn’t sell its users to the highest bidder. Facebook might not fall today, but they will certainly fall tomorrow when users get a better option.
Internet technology has brought marginal cost down to zero. Having 10 apps or 10 million apps in the Apple Appstore doesn’t make much difference cost wise, but Amazon, Facebook, Google, Airbnb, Uber and Apple still operate with 20th century thinking: he who controls the means of production shall reap the benefits. However, that is no longer true.
(Near) zero-cost production thanks to internet technology can result in fairer production and more equality. The internet changed the way we distribute information and knowledge. Now we can tackle the internet of money, changing the way we distribute wealth. We are just a few steps away from creating new economies. We want them to be cooperative and based on fairness and equal benefits.
