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Book Review: Is the Internet Just Another Example of Monopoly Capitalism At Work?

BY Micah L. Sifry | Thursday, June 27 2013

Robert McChesney speaking at the 2008 National Conference on Media Reform (Photo from

Monday morning, during the opening session of the MIT-Knight Civic Media conference, Sue Gardner, the outgoing executive director of the Wikimedia Foundation, made a bold statement that quieted the room full of digerati.

"We are not lost, but I think we are losing," she said. Taking the long view on the evolution of civic media since the rise of the Internet, she said, "We don't have the information sharing utopia that we imagined we'd have." Other than Wikipedia, which is the only nonprofit website in the top 25 most visited worldwide, the web is dominated by the platforms and the values of for-profit companies.

"The insiders are winning," Gardner declared. For the health of society, she said, we need a flowering ecosystem made up of the digital equivalent of public parks, libraries and schools, not just one Wikipedia as the exception to the rule. "The overall weighting of where people spend their time is wrong." For more proof, she urged the audience to read Tim Wu's Master Switch, which came out in 2012, and Robert McChesney's new book Digital Disconnect.

While I certainly second Gardner's endorsement of The Master Switch, which carefully and eloquently describes the recurring pattern of disruption and concentration in the US communications industry for the last century, coupled with a timely call to defend the open Internet from the same dynamic, I can't quite say the same for Digital Disconnect. Though both books aim to situate the development of the net inside the larger political economy, McChesney uses a sledgehammer where Wu uses a scalpel. And where Wu argues up from existing evidence to warn us about the possible future, McChesney presumes to know where the net going based on a theory of monopoly capitalism that for him explains everything.

McChesney, who is one of the cofounders of Free Press, the author of several books on the media, and a professor at the University of Illinois, says he always wanted to write a book about the Internet and the larger digital revolution. But he held off, because "grasping the Internet was like trying to shoot a moving target in a windstorm." Then he and John Bellamy Foster co-authored a 2011 article called "The Internet's Unholy Marriage to Capitalism" for Monthly Review and it hit a chord. The time, McChesney says, was finally ripe.

I wish he had held his fire. Here's why: McChesney doesn't quite get the Internet. Again and again, in Digital Disconnect, he conflates the free and open net with the larger digital ecosystem, eliding or underplaying important distinctions between the actions and ambitions of big tech and communications companies and the behavior of individuals and networks online.

The problem starts with the book's first pages, where McChesney writes that capitalism is "domesticating the Internet" and then goes on to describe the net (on page 2) as everything from the Usenet, the world wide web, AOL, and broadband, to Google, wi-fi, iPads, smartphones and social media. Even the rise of mobile phone usage in Africa, which is a very important trend but often does not include any Internet acess, is included in McChesney's "Internet."

From there, after several chapters laying out McChesney's general views on capitalism, democracy and political economy, we come to his discussion of "the Internet and capitalism." And the conflation continues. He writes:

"It is supremely ironic that the Internet, the much-ballyhooed champion of increased consumer power and cutthroat competition, has become one of the greatest generators of monopoly in economic history….In 2012, four of the ten largest U.S. corporations in terms of market valuation, including number one and number three, were Internet giants Apple, Microsoft, Google and AT&T. Add IBM and that is five of the top ten. If one goes down through the top thirty, the list then includes Verizon, Amazon, Comcast and Disney, as well as the Internet giants that depend less directly on the consumer market: Intel, Cisco, Qualcomm, and Oracle. That is thirteen of the top thirty firms….In short, the Internet monopolists sit at the commanding heights of U.S. and world capitalism."

A few pages later, he adds:

The best way to imagine the Internet is as a planet where Google, Facebook, Apple, Amazon, Microsoft, and the ISP cartel members each occupy a continent that represents their monopoly basecamp….The goal of each empire is to conquer the world and prevent getting conquered by someone else."

This is heady, "world-historical" stuff. (Monthly Review writers like that word.) But hold on. McChesney is making two mistakes here, one that is obvious and the other a lot less so. The first is that he's including telco monopolists (AT&T, Verizon, Comcast) and content monopolists (Disney) as Internet companies, which they're not. In fact, their interests are often opposed to companies like Google that benefit most from the open net.

The second mistake is more fundamental: McChesney's conception of political economy makes him look under the lamppost where the light is brightest; hence he sees market valuations as proof of where power lies. The fact that the real Internet, the system of protocols that allow computers and people to connect and network without requiring permission from anyone, that allows anyone to use it and improve on it, and that nobody owns, has opened a vast space of non-market value and power just doesn't fit on McChesney's radar screen.

Consider: Wikipedia gives people free access to knowledge that Britannica used to charge thousands of dollars for. Craigslist gives people free classifieds. Skype and a host of similar communications tools give people the equivalent of free phone calling. All kinds of blogging and networking platforms from Facebook to Twitter to Google and Yahoo groups have given people massive free organizing tools when printing/mailing/posting flyers and maintaining internal communications used to cost activists huge amounts of time and money. GitHub is enabling a massive expansion of free code-sharing and improvement. Open and free data APIs from government, NGO, journalistic and commercial sources allow untold development of tools and services.

These are some of the ways that the net has expanded the non-market economy, but they figure nowhere in McChesney's analysis. Thus, when he discusses the work of Yochai Benkler, who he quotes describing how "the Internet has allowed social, nonmarket behavior to move from the periphery of the industrial economy to the very core of the global networked economy," McChesney's response is just to say "there is precious little proof that capitalism as a system is moving in this direction. To be more precise, there is none."

Again, not so fast Professor! The sharing economy, which first emerged around our freedom to connect and share bits online, and thus first decapitalized, if I may use that word, businesses like information, classifieds, telephony, group-formation, and code-sharing, is now starting to make real headway into the older economy of things. As Robin Chase, the co-founder of Zipcar, pointed out at PDF earlier this month, while it took Hilton 93 years to grow to a hotel chain offering 610,000 beds worldwide, AirBnb is at 650,000 beds after just four years. CouchSurfing is at 1.5 million beds in eight years. BlaBlaCar, a service that enables people to easily share rides in Europe, hit 3 million passengers in 2012. Crafters are going to sell a billion dollars worth of their products thru Etsy this year, and no one really knows how much free stuff gets recycled through sites like Craigslist or Freecycle.

Collaborative consumption is one of the uber-trends of our century. But for an author that treats the global economic crisis as a given, it is doubly confounding that McChesney hasn't noticed that one big way that people are coping is by taking advantage of connection technologies to ease their burdens and share their wealth (and also organize for change).

This blind spot hurts Digital Disconnect even on the turf that McChesney knows best, the news business. It's frustrating to have to say this, because I agree completely with his insistence on evaluating media "by determining how they affect political social and political power in society and whether they are, on balance, forces for or against democracy and successful self-government." And I think he is absolutely right to worry loudly about whether we will have a healthy enough journalism sector to hold the powerful to account, inform the public and ensure that issues are debated fully.

I even found myself agreeing with McChesney's call for expanding public subsidies to journalism. If taxpayers can subsidize business research and development and give oil and gas companies, ranchers and miners huge subsidies, surely we can create new ways to support a robust journalism sector beyond cheap postal rates and paid government notices in print media. His (and John Nichols') concept of a citizens news voucher that every adult could use to donate to nonprofit ad-free media of their choice is really intriguing. Public goods, be they schools, roads, or communications systems, need public subsidies.

But isn't the Internet itself already a gigantic public subsidy of journalism? By drastically lowering the costs of communication and expanding the reach of anyone with a compelling message, haven't we opened up a fertile new territory for all kinds of valuable civic reporting? For some odd reason, McChesney can't let go of the notion that journalism has to be done by professional journalists, as though this is some kind of either-or choice.

For example, he mourns the fact that the Center for Media and Democracy, a nonprofit watchdog group, broke the news on the secretive American Legislative Exchange Council, saying we shouldn't "make a virtue out of a necessity." Really? Why not instead applaud the success of independent media (which in this case produced huge repercussions for its target)? Instead of praising WikiLeaks for publishing a series of scoops over the last several years, McChesney oddly insists that "WikiLeaks was not a journalistic organization" and that its releases would have gone nowhere without professional journalists as its partners. (To be fair, WikiLeaks absolutely benefited from its partnerships with mainstream outlets, but that hardly justifies saying that it is not a journalistic organization.)

This isn't to say that McChesney is oblivious to the noncommercial side of the web. He tips his hat to Wikipedia and notes that "using dissident websites, social media and smartphones, activists have sometimes 'bypassed the gatekeepers' in what John Nichols calls a 'next media system.'" Alas, he is too attached to the notion that this the last gasp of an old order than the harbinger of a new one.

The result is a book that is less convincing than it ought to be and far gloomier than it needs to be. Yes, traditional journalism is in crisis and we do have reason to fear what its collapse is doing to our republic, but as the authors of the Tow Center's report on "post-industrial journalism" argued recently with great detail, there are also many promising developments in the field and on the horizon. And yes, the larger global economy is also in crisis, and we need to find our way toward some new economic system that is more equitable and sustainable, but the Internet and the networked culture it enables may be a big part of the solution.