The Rise of Chokepoint Capitalism: A Critical Analysis by Rebecca Giblin and Cory Doctorow
Chokepoint Capitalism: How to Break Free from Big Tech and Big Content
If you are a creative worker or a consumer of creative products, chances are you have encountered the phenomenon of chokepoint capitalism. It is the term used to describe how corporations use their power and influence to control the markets for creative labor and goods, squeezing out the creators and consumers who should rightfully benefit from them. In this article, we will explain what chokepoint capitalism is, how it affects you, and how you can fight back against it.
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What is Chokepoint Capitalism?
The Definition and Examples of Chokepoint Capitalism
Chokepoint capitalism is a term coined by Rebecca Giblin and Cory Doctorow in their book Chokepoint Capitalism: How Big Tech and Big Content Captured Creative Labor Markets and How We'll Win Them Back. It refers to the practice of corporations creating "chokepoints" or barriers that prevent competition and innovation in the markets for creative work. These chokepoints allow corporations to capture more value than they deserve, while leaving less for the creators and consumers.
Some examples of chokepoint capitalism are:
Amazon's dominance over the book industry, where it dictates the terms and prices for publishers, authors, and readers.
Spotify's control over the music streaming market, where it pays artists a fraction of a cent per stream while making billions in revenue.
Facebook's monopoly over social media advertising, where it collects massive amounts of data from users and sells it to advertisers.
Ticketmaster's grip over the live event industry, where it charges exorbitant fees to fans and artists while blocking alternative platforms.
The Consequences of Chokepoint Capitalism for Creatives and Consumers
The consequences of chokepoint capitalism are dire for both creatives and consumers. Creatives face lower wages, fewer opportunities, less autonomy, and more exploitation. Consumers face higher prices, lower quality, less choice, and more surveillance. Chokepoint capitalism also stifles innovation, diversity, and culture, as corporations prioritize their profits over the public interest.
Some consequences of chokepoint capitalism are:
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Authors losing their royalties when readers return their books on Audible's unlimited return policy.
Musicians struggling to make a living when Spotify pays them less than a penny per stream.
Journalists losing their jobs when Facebook diverts ad revenue from news outlets.
Fans paying more than double the face value of tickets when Ticketmaster adds hidden fees.
How Did We Get Here?
The Rise of Corporate Power and Concentration
Chokepoint capitalism is not a natural or inevitable outcome of the market. It is the result of deliberate actions by corporations to increase their power and concentration. Corporations use various tactics to create chokepoints, such as mergers and acquisitions, exclusive contracts, proprietary platforms, network effects, lobbying, litigation, and misinformation. These tactics enable corporations to lock in customers and suppliers, make their markets hostile to new entrants, and influence regulators and policymakers.
Some examples of corporate power and concentration are:
Amazon acquiring Whole Foods, Audible, Goodreads, IMDb, Twitch, Zappos, Ring, PillPack, MGM Studios, and many more companies.
The Failure of Regulation and Competition
Chokepoint capitalism is also the result of the failure of regulation and competition to protect the public interest and promote a fair and diverse market. Regulators and policymakers have been either unable or unwilling to curb the power and practices of corporations, often due to their influence and lobbying. Competition authorities have been too lenient or slow to intervene in cases of mergers, acquisitions, and antitrust violations. Consumers and workers have been left with few options or alternatives to challenge or escape the chokepoints.
Some examples of the failure of regulation and competition are:
The Federal Trade Commission's approval of Amazon's acquisition of Whole Foods, despite concerns over its impact on grocery prices, quality, and choice.
The European Commission's fine of Google for abusing its dominance in online advertising, but without requiring any changes to its business model or practices.
The lack of enforcement of the Digital Millennium Copyright Act's provisions that allow users to circumvent digital locks for fair use purposes.
The absence of a federal privacy law in the US that would protect consumers from data collection and misuse by corporations.
The Role of Technology and Data
Chokepoint capitalism is also enabled and exacerbated by the role of technology and data in the modern economy. Corporations use technology and data to create proprietary platforms, algorithms, and services that give them an edge over competitors and customers. They also use technology and data to monitor, manipulate, and exploit users' behavior, preferences, and emotions. Technology and data can also create network effects, lock-in effects, and switching costs that make it harder for users to switch to other providers or platforms.
Some examples of the role of technology and data are:
Amazon's use of its Kindle e-reader and Audible app to lock users into its ecosystem and prevent them from accessing books from other sources.
Spotify's use of its recommendation algorithm to influence users' listening habits and preferences, while also collecting data on their tastes and moods.
Facebook's use of its News Feed algorithm to filter and prioritize the content users see, while also manipulating their emotions and opinions.
Ticketmaster's use of its Verified Fan program to create artificial scarcity and demand for tickets, while also collecting data on users' willingness to pay.
How Can We Fight Back?
The Book Chokepoint Capitalism by Rebecca Giblin and Cory Doctorow
If you are interested in learning more about chokepoint capitalism and how to fight back against it, you should read the book Chokepoint Capitalism: How Big Tech and Big Content Captured Creative Labor Markets and How We'll Win Them Back by Rebecca Giblin and Cory Doctorow . The book is a comprehensive and accessible analysis of the problem, as well as a practical and inspiring guide for action. The book covers various sectors of the creative economy, such as books, music, news, film, TV, radio, podcasts, games, comics, art, fashion, software, and more. The book also provides concrete tools and strategies for workers, consumers, activists, policymakers, regulators, lawyers, academics, librarians, educators, artists, journalists, musicians, authors, and anyone else who cares about creativity and culture.
The Tools and Strategies to Smash the Chokepoints
In their book Chokepoint Capitalism, Giblin and Doctorow offer a range of tools and strategies to smash the chokepoints created by corporations. Some of these tools and strategies are:
Transparency rights: The right to know how corporations use our data, how they set their prices, how they pay their workers, how they influence our choices, how they affect our culture.
Collective action: The power to organize with other workers or consumers to demand better terms, conditions, wages, prices, quality, choice.