anil dash on the evolution of false markets via the internet22 Mar 2017
around 29 minutes into anil dash’s interview on design matters he talks about this fascinating and terrifying trend. because he lays it out so brilliantly, i’m just going to rehash his points as i understood them.
the first wave of markets on the internet were the most like open markets. websites like ebay and etsy are simply platforms that allow buyers and sellers to find each other. sellers compete on price and quality and that’s all openly viewable to the buyer who makes the final decision about what to choose and at what price. everyone is (more or less) on equal ground.
the second wave of internet “markets” is the one where the platforms “have their thumb on the scales.” this is what it looks like when google has “sponsored products.” google (and many other platforms like it, including amazing) are effectively saying “yes, we’ll absolutely show you everything everyone has to sell, but we’re going to make sure the first thing you see is the product of whoever is willing to pay us the most for their product placement.”
this third wave of “markets” is when these services aren’t really markets at all.
uber says it’s a marketplace for drivers and riders. however, this doesn’t function anything like an actual real market:
- no one but uber can set prices
- drivers and riders can’t choose each other of their own decision making
- we know that uber fakes cars being around you in order to induce users to “buy”
all of this is happening while uber tauts itself (successfully) to politicians, policymakers, and the public as “a marketplace for drivers and riders.” bullshit.
anil didn’t say this, but i also think that the ubers and lyfts of the world intentionally (either up front or over time) business models that operate at scales such that they prevent entry from other actual competitors. they also push other service providers (smaller ridesharing companies, existing taxi services) out. but i digress…
anil thinks this “false market” approach is spreading. he’s concerned because it’s actually a (brilliant) systematic way of undermining labor and actual markets but because the approach is treated like open markets entities by politicians and entrepreneurs, the rules of the game aren’t being reshaped. soooooo problematic.
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