The Junk Merchants

“The junk merchant doesn’t sell his product to the consumer, he sells the consumer to his product. He does not improve and simplify his merchandise. He degrades and simplifies the client.”

― William S. Burroughs, Naked Lunch

The rise of social media platforms has revolutionized the way people communicate, interact, and access information. These platforms have become an integral part of our daily lives, offering us an opportunity to connect with others, share our experiences, and stay informed about the world around us. However, the adage “power corrupts, and absolute power corrupts absolutely” applies to social media platforms as well. These platforms tend to abuse their power in the pursuit of greater profit and market dominance.

The process of abusing power and privilege ends always “selling customers to the product.” This is a gradual shift of surplus value away from the stakeholders who create it towards those who have the most power and influence within the system. Platforms begin by directing surpluses towards users to attract and retain them. This can take the form of discounts, promotions, or other incentives that encourage users to engage with the platform and generate value for it.

Instead of a “junk merchant,” we can think of these platforms as “attention merchants” who do not necessarily sell a physical product, but rather sell the attention and data of their users to advertisers and other businesses. Like the junk merchant, the attention merchant does not necessarily improve and simplify their platform for the benefit of the user. Instead, they may degrade and simplify the user experience in order to capture and hold their attention for longer periods of time. This can be seen in the way some platforms prioritize addictive features like infinite scrolling, autoplay, and push notifications, which can be detrimental to the user’s well-being and productivity.

In this sense, the attention merchant is not primarily concerned with the well-being or satisfaction of their users, but rather with extracting as much value as possible from their attention and data. This can ultimately lead to the same trajectory of enshittification seen in many platforms, where the interests of shareholders and advertisers come to dominate over those of the users and other stakeholders.

As the platform grows, it starts to shift its focus towards its business customers to monetize its user base by offering advertising and other services to businesses that want to reach those users. During this stage, the platform’s interests may begin to diverge from those of its users, as it seeks to maximize revenue and market share.

Once the user base is locked in, the platform shifts its focus towards suppliers. This is the second stage of the process, where the platform seeks to extract more value from its suppliers by negotiating better terms, increasing prices, or reducing quality. As suppliers become more reliant on the platform for their own success, they may find themselves trapped in a system where they have little bargaining power and must accept whatever terms the platform dictates.

This can lead to the third stage, where the platform begins to abuse its business customers in order to claw back all the value for itself. This can take many forms, such as raising prices, reducing service quality, or even outright competition with the very businesses it was supposed to be serving. As the platform becomes more dominant and powerful, it can leverage its position to extract more value from its customers, often at the expense of their own success and sustainability.

The platform begins to hand surplus value over to shareholders, at the expense of both users and suppliers. This can take many forms, such as stock buybacks, dividend payments, or executive compensation, but the end result is a platform that no longer provides real value to anyone.

The cycle of abuse can lead to the downfall of the platform, as users become disillusioned with the platform’s behavior and begin to leave in search of alternatives. This can trigger a downward spiral of declining revenue, reduced investment, and eventual failure.

Businesses must adopt a more holistic approach to value creation, one that balances the needs of all stakeholders and recognizes the interdependence of their success. By focusing on sustainable growth and shared value creation, businesses can build platforms that truly serve the needs of all stakeholders, rather than just the interests of a select few.