Platforms deploy all their power first, particularly in the economic sphere. To shed light on these implications, INCA aims, first of all, to understand how digital businesses, and digital platforms, create and capture value. They grew up extraordinarily after the 2007/8 crisis and promoted labour digitalization and the dismantling of standard forms of labour. Platforms often disintermediate labour collective contracts or bargaining institutions, thus posing serious challenges to workers’ individual and collective rights, and states and even the European Unions have significant difficulties in controlling these companies’ practices. As a result of this approach, digital platforms have become some of the companies whose wealth increased more dramatically during the last years, while Oxfam reports signals of increasing presence of platform workers among the ranks of the new poor at the global level.
Economy
Moreover, the big platforms also employ their power to directly influence public opinion. Platforms constantly produce a narrative on themselves – the positive and appealing impact of digital technologies, the usability of e-commerce, the flexibility of platform labour, and the social benefits these corporations spread – through their activities, on media, and with advertisements. This leverage goes beyond the mere “whitewashing” of themselves, they can also influence how businesses operate on the market, they can steer innovation, and they can also influence decisions by consumers, for instance, by nudging them or by using certain defaults.
For the accomplishment of all these objectives, platforms depend on (and take advantage of) network effects, the central dynamics in which the value of a platform for an individual user increases as the number of users of the entire network grows. There are two important implications from that. On the one hand, platforms do their best to generate positive network effects, and they create such technological arrangements that will allow them to maximize their network effects, occupy the space, and market space, and also to accumulate more data. And the second implication is that because of the network effects dynamics, they tend to become monopolies. We can see that only a few platforms occupy the market space.