The Killer App Is John Rockefeller?

Despite all the hoopla and rhetoric to the contrary, much of the ‘new’ economy, the ‘sharing’ economy, and the various other names for it is nothing more than the same old economy, just with more CPUs.

With that by way of prelude, we bring you Tom Slee’s concise description of Über’s real killer app (boldface mine):

There’s $7bn of VC money that’s betting on Uber being a monopoly market. If it isn’t, then the VCs take a bath. A lot of well funded effort is going to make it a monopoly market. It’s not clear there’s one global monopoly; China is a special case, Uber is struggling there. But there will be a small number of winners. Despite all the investment in Lyft, Uber is likely to be the winner.

Attempting to create a monopoly is hardly an innovation. The problem with ‘breakthroughs’ that only require some programmers is that anyone can make them, leading to this:

These policies [non-compete contracts] (which, at the low-tech end, many experts think are unenforceable) suggest that there’s a large bullshit economy. What I mean is that most of these businesses aren’t providing anything novel–there’s no reason why one couldn’t ‘clone’ Camp Bow Wow or a sandwich chain. These companies make money by being ‘first past the post’, large (allow expansion and business policies that chase out weaker competitors), and beating the shit out of their workers. But there’s very little that’s actually creative or truly proprietary….

The first sentence is key–and it doesn’t just apply to “tech companies in name only” (‘TCNO’?-‘techno’?): most companies aren’t providing something novel, so in a winner-take-all system (i.e., not local or regional businesses) the ‘breakthroughs’ aren’t technological at all, but time-honored monopoly, monosopy, worker exploitation, and political maneuvering.

Same as it ever was…

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2 Responses to The Killer App Is John Rockefeller?

  1. Joe Shelby says:

    Indeed. Locally, there was a small-time competitor to Potbelly called “Coggins”. Potbelly put them out of business, not by a trademark or patent lawsuit, but by claiming a *copyright* on putting sandwiches in a moving oven. It would never hold up in court, but the small company couldn’t afford the fight, while Potbelly had the resources to appeal it all the way, adding in all the delays and injunctions and appeals on injunctions.

    That the idea of a copyright on how to cook something (the actual process, not a publication) would even be admissible in court is a sign of how twisted lawyers can be these days.

  2. wphurley says:

    Even though I’ve said the following in reference to Uber, many other new econ businesses fit the bill. That is that arbitrage is not innovation.

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