This is an interview with Nathan Schneider for Internet Sovereignty, nine writers exploring the future of the internet through an essay collection and print pamphlet. Support the project by collecting the digital or print edition. 👇🏻
Nathan Schneider is the author of Everything for Everyone and Governable Spaces. Here is our conversation about how we can create better internet platforms, available as a video (above) or edited transcript (below).
Elle Griffin: What is technofeudalism, and what can we create instead?
Nathan Schneider: There are two approaches to this metaphor. The first is that of Yanis Varoufakis, the economist and former finance minister of Greece, who wrote in his book Technofeudalism that capitalism is being undermined by platform economies that are intrinsic monopolies built around achieving dominance over a whole sector of the economy and eliminating competition.
Another approach to the feudalist metaphor is the one I take in my book Governable Spaces, which begins by asking: Do we experience democracy in a group chat, a Facebook group, an Instagram thread, or an open-source software project? And how did that compare to experiencing democracy before the internet existed? My mother’s garden club, for example, has far more democratic structuring, elections, bylaws, and procedures than virtually any online space I’ve ever been part of. I call this habit of everyday oligarchy in online spaces “implicit feudalism.”
I was interested in tracing the history of implicit feudalism and how it gave rise to a political ideology that craves a return to monarchism, which we now see very much alive in American politics and politics in many parts of the world today. I argue that turn is not just a rehashed authoritarianism, but is actually coming out of our experience with online life.
Elle: Are you saying online life should be more democratic if we want a more democratic society?
Nathan: It’s less that they’re antidemocratic, and it’s more that they didn’t even try. That’s why I call the feudalism “implicit”—because people were calling the early internet “democratic” when a lot of these norms were forming. But in actual practice, they did not set up tools for collective decision making, or the basic features of democratic life that people like Alexis de Tocqueville or Robert Putnam knew as everyday democracy.
The practices that we might experience in a garden club, a labor union, a neighborhood club, or a mutual insurance organization—none of these are present in the corporate platforms that now run the internet, or even the very community-driven platforms that came before the internet was commercialized. In some respects, it’s not just a critique of corporate power that I’m talking about. It’s actually an ideology that came before. Corporations figured out how to make gobs and gobs of money on the internet, but now we’re seeing the deeper consequences.
Elle: What’s an example of an online platform that you think shows how this could work better?
Nathan: Great question. Some of the early cases that come to mind are Wikipedia, where you have participants co-governing the platform. You have open source projects like the Debian project, which runs the software that a lot of web servers are running on. A driver’s cooperative in New York (and now here in Colorado) has a rideshare platform governed and owned by its drivers, and Stocksy is a stock photography service that is co-owned by its workers and photographers. A new one that’s really exciting is called Subvert, it’s an attempt at a Bandcamp replacement that is owned by musicians.
These kinds of models have tried to kind of dream up a vision for a different kind of internet, but so often they’re running up against incredible pressures and incredible power. They’re struggling to raise half a million dollars with a crowdfunding campaign. Meanwhile, their competitor can raise $30 million on a pitch deck. So we’re really in a situation where we know it’s possible to do things differently, and the experiments are out there, but we don’t have a system that’s well set up to support the real success of those experiments.
It’s really important to recognize that the ability to get $30 million on a pitch deck is fueled by the law and by the idea of venture capital. This model is the dominant way of financing tech companies, but that too had to be invented. It wasn’t until the late 1970s, when laws were changed and regulations were adjusted, that venture capital started to take off. We have to recognize that the situation we’re in was constructed through policy and decision-making, and other systems are possible too.
Elle: Do we need a platform cooperative version of every internet platform? Not just a musician-owned Spotify, but also an artist-owned Patreon and a writer-owned Substack?
Nathan: Those alternatives exist. Ghost is a nonprofit-driven platform that operates on a different model. For Patreon, you have Open Collective which has some really interesting differences but is also working asymmetrically. But their ability to win the entire market is not the same as venture-backed competitors. The alternatives are out there, and they’re possible, but it’s a real David and Goliath story.
Elle: That’s frustrating as a writer and creator on the internet, because you see all of these great examples, but a lot of them are very niche and very small. I read Everything for Everyone recently, which was published eight years ago, and when I looked up every company that was featured in that book, so many of them were closed or gone. So you had all these great examples that really empowered me and inspired me, but then we can’t even create it. Everything stays too small, we can never get the $30 million from a pitch deck to make them bigger, or the system isn’t allowing us to do it. Why are these experiments not working out in the end?
Nathan: The first reason is just that startups are always high risk. Whether they’re venture-backed or not, doing something new is very hard. The second reason is that, historically, cooperatives have tended to play cookie-cutter roles. You have your credit unions, your food co-op, your hardware co-op—they take a model that existed in one community, and they replicate it in lots of communities, and that’s still a really viable approach. But when you’re trying to build an online platform, network effects are really important. It really matters how many people you have participating to create value for the platform. It’s hard to achieve that scale with any amount of funding. And your likelihood of success without a ton of funding is even lower.
Elle: Is it a funding constraint primarily?
Nathan: And, by extension, a policy constraint. I was working with the founder of Meetup.com some years ago. His company was up for sale by WeWork, and its revenue is all from its users. He thought it would be perfect as a co-op, and that’s what he dreamed of, but the US didn’t have the structures in place to be able to do that. We have to recognize the way in which public policy is saying which structures are okay and which structures are not. When you create that structure, capital is able to flow into them at large scales. The problem is that, at least in the United States, we’ve always siloed it. We’ve always said, “You can have a cooperative structure, but it has to be for this very specific problem.” What I believe we need are structures that allow us to do anything we want with shared ownership. And that includes tech platforms.
Elle: I spoke with a lawyer about turning my business into a co-op and he actually advised against that, because he said it would limit what we can do financially just because of the way the co-op structure is set up in the US. It doesn’t need to be that way!
But I also want to go back to talking about the network effects problem. Because in a world in which the venture-backed world rules, and the cooperative structures are disadvantaged, how can we compete? As a musician, do you put your music on Spotify and hope for that big reach despite the economic disadvantage? Or do you put it on Bandcamp or Subvert where the economics are much better but the audience is much smaller? Are we placing ourselves in the hands of technofeudalism by living on the larger platforms? Can we still create sovereign collectives inside the technofeudal structures that currently exist? Or do we need to create new parallel ones outside of them?
Nathan: It’s the oldest question in the world, right? When you’re in the empire, how do you create the space of liberation? I used to be a freelance reporter, and back then, I did not have a choice to not be on all the social media platforms. One of the advantages of being an academic now is that my paycheck is not dependent on my social media reach, so I get to spend a lot more time on, for instance, a cooperative I co-founded on Mastodon called Social.coop. It’s a social media platform that is governed as a cooperative and I just prefer to spend my time there. My reach is much, much smaller than if I were spending more time on X or Instagram, and I still broadcast to those places, but I don’t really hang out there out of preference. But I totally recognize the way in which others need to make other choices in that regard.
Elle: I don’t know if you’re familiar with the platform Metalabel, but we’ve been publishing collaborative print pamphlets there, which has been a fun way to dip our toes into profit sharing and creating cooperative media projects, without needing to actually become a cooperative. Do you see advances in technology aiding these models? Is it the legal business structure we need, or do we just need platforms that can facilitate these transactions?
Nathan: I think what Metalabel is doing is really interesting. My lab did a release on Metalabel early on, and we’ve been having conversations with founder Yancey Strickler all along. I really appreciate how they’re trying to figure out where we can meet people.
A question that I think is worth asking is: What kind of sharing is important in any given project? Sometimes it’s the governance that really matters. We need to make sure that people have a voice. With Social.coop, nobody’s making significant money off of it. What matters is the governance. Sometimes profit-sharing is the component that matters.
I think it’s really important to recognize that the way technology is designed makes huge differences in what’s available to us democratically. For example, a Facebook group does not have the functionality to vote off an admin. It wouldn’t be that hard to build that functionality in, but it’s just not there. One thing that’s interesting about Metalabel is that it started out with Blockchain technology which broke the logic of implicit feudalism because it wasn’t built on a central server. As a result, people started, in 2017 to 2020, developing really interesting governance experiments.
In that regard, the nature of the technology has huge effects on the democratic possibilities available to people using it.
Elle: How much governing access should I have online? How much should Substack take into consideration what I think as a writer on the platform? And how much should Yancey Strickler take into consideration how I want to use Metalabel? The Elysian Collective is a community of writers gathering together on a project—how much governance should the other writers in my world have over what we’re doing?
I’ve seen discussions on Substack about the contradiction between what writers want Substack to be like and what the platform knows will make writers money. The writer thinks, “I want this to be a quiet place where I can read and write and nothing else,” but the platform can see that when it adds other features that helps writers with discoverability, it also increases their sales potential. Who should be in charge of those decisions, and how do we balance those competing ideas?
Nathan: Those are really important questions, and they’re deeply related. This is something my colleagues and I just published a paper on. It’s called “Online Governance Surfaces and Attention Economies.” Say that we win and we democratize everything: What should we expect of ourselves and each other for participating in governance?
Many of the people reading this are probably co-owners of major companies that affect their lives. That ownership might be constrained to financial interests—they own stock—but there is a system designed to maximize shareholder return. The goal for other kinds of shared ownership models is to broaden the reasons that we become stakeholders. Maybe you’re a member of Substack for reasons other than just making Substack richer and richer and richer. Maybe there are priorities you have for your Substack that are different from what an investor’s priorities would be.
That doesn’t mean we should do away with leadership. Leadership still matters. Leaders still have to make hard decisions. People who lead investor-owned companies still have to have hard conversations with stakeholders. The question is: Who are the stakeholders they should be up at night worrying about? And I think a lot of leaders wish they could be accountable to people other than the people that they happen to be accountable to.
Shared ownership is less about making every decision by committee and having everybody in the room have an input on everything, and more about who you are accountable to at the end of the day. Who do you have to answer to? That’s what this is about. It’s not about introducing an unsustainable sort of micromanagement into the operation of an organization.
Elle: As a journalist, I’ve worked in rooms where the editor-in-chief has the final say and chooses everything the writers write about, and at DAOs where nobody was in charge, and everybody was writing about whatever they wanted and there was no cohesive direction at all. What could an ideal scenario look like for creative stakeholder ownership?
Nathan: I think the starting point is having stakeholders elect the board. That means they are not involved in management, they are not the president. They’re not interfering with how the HR department functions. They have that one piece of input, which is the same piece of input shareholders often have in investor-owned companies. This might sound boring, but it’s the most important.
Basically, everyone who has experience in the cooperative scene agrees that having no leaders and voting on everything is completely unsustainable and ridiculous. Many had to learn that the hard way, and sometimes through interesting experiments, but they often end up replicating a lot of the structures that already exist in corporate America but with different names. “Quarters” become “seasons,” “proxy votes” are “liquid democracy,” and so on. Boards were invented for the same reason that we invented two- and four-year elections. You need to have this kind of structure.
That’s not to say we can’t improve these structures. There’s a lot of excitement these days among people interested in sortition, using randomly selected juries for more functions. That could become a lot cheaper using online tools, and AI companies and social media companies have been experimenting with these kinds of practices under the hood. X’s Community Notes feature is built on a really amazing democratic tool called Polis that’s all about finding points of agreement. So there’s a lot of really interesting stuff going on right now that I think could open the door to moving beyond representatives on boards.
Elle: I love the idea of tech platforms facilitating a kind of new democracy. For instance, with the Elysian Collective, I curate the group of writers who participate in our collaborative print pamphlets. But with Metalabel’s new Dark Forest Operating System, members will soon be able to publish something secretly inside a small community, and members could upvote various essays into pamphlets. Are there other experiments you find exciting when it comes to the democratization of the internet?
Nathan: I’ve run a few publications, too, and I think we have to be really thoughtful about what we want to democratize. Sometimes we don’t want to democratize taste. You are the person that people have come to trust and maybe they’re here because you’re going to make calls the group as a whole isn’t going to make. Communities of taste are built around a vision, and often that vision is very personal.
But maybe you can democratize things other than taste. Maybe it’s the infrastructure you democratize, perhaps by sharing the revenues like you’re doing with your book, We Should Own The Economy. That’s a really powerful way to share ownership, while not changing whose voice is going to be guiding the process.
The more I learn about democratization, the more I think we can’t throw away everything we know from other kinds of organizations. Let’s just get the accountability right and have the right stakeholders in mind.
Elle: While you were talking, I couldn’t help but think that there is a lot of voter choice, so to speak, online already just by the fact that you can subscribe to somebody, and unsubscribe from somebody. You can choose to pay them. You can choose not to pay them. You can choose to get off the platform and use a different one. By virtue of competition, both platform competition and creator competition, there already is a lot of choice on behalf of the reader or the patron of that art, so that alone is at least some form of democratic practice.
Nathan: The role of exit is a really important aspect of online experience. One thing I really appreciate about Substack is that they build the platform on an open protocol email—the exit option is always there. You can always move your subscriber list to a different email provider. Of course, they are trying to build more “lock-in” features, but the initial impulse is very powerful.
But I also don’t think exit is enough. The economist Albert O. Hirschman had this distinction of exit and voice, arguing that you need to balance both. And that is especially important when we start to become dependent on these platforms, and the exit option isn’t actually real. If we’re creators trying to make a living with our communities and the exit option is not real, voice should be an imperative. And that’s something that we often haven’t had.
Elle: If you could architect a better future for all of these platforms, what are the things you think platforms should implement that would give more voice to the people that are who are actually creating the internet?
Nathan: Companies can be wildly successful by being appropriately accountable. Cory Doctorow just put out this book about Enshittification—that platforms start by being wonderful to their users, and then turn on them once they have to make money. He’s right about that, and we should fight for a system in which companies actually can succeed and be accountable to their users at the same time.
In 2019, Uber and Airbnb were getting ready for their IPOs and they submitted letters to the SEC asking to share ownership with their users. The Airbnb letter, in particular, was like: “Look, our users are what make this platform possible. We want to align our incentives with our users. We want to hear from our users. We want them to have a voice in governance.” That became really important when the pandemic hit, and they needed buy-in from those hosts, but the SEC didn’t have a framework for that.
These companies are often demonized as the worst of the worst platforms that dominate everything, but they were begging for a framework that would align their incentives with their users. And the SEC couldn’t do it.
That’s all I’m asking, in some respects: Let’s start with a really good version of what Airbnb and Uber wanted to achieve at the moment. Where companies are going up for an IPO, and can align incentives with their users because users are the ones who actually make the business healthy. I hate to be such a corporate chill here, but over the years, I’ve encountered so many founders who just wish they had better options. They wish they didn’t have to make a bad business decision and compromise the long-term health of the community and platform they built just because of the need to meet short-term financial interest, and because the only game in town is investor ownership.
Elle: When you say, “align incentives with users,” what do you mean? How could Airbnb have aligned incentives with users? Or, how could Uber have done that at the point of IPO?
Nathan: In their case, they were asking for something really modest, which was just to be able to grant equity to their users the way they do with their employees. We already incentivize our employees with equity; why can’t we do that with our non-employees?
But let’s think about the even bigger picture: What if a company could also be accountable to the users they depend on. Uber drivers, Airbnb hosts, they all want to make money too. Writers want Substack to be successful because they want to be successful. I think we could deepen that alignment even further. For instance, the goal of the Drivers Cooperative in Denver is to make drivers money. That’s really cool! They have very serious disagreements about how to make drivers money. They’ve argued, for instance, about algorithmic pricing and surge pricing—should we do that? Should we not? But that company, at the end of the day, knows that the goal is not to screw over drivers, it’s to make this as lucrative as possible for the people who are driving cars in this city. I think that is a totally reasonable goal we should be able to run a business on.
Over and over, I’ve seen people try to build these reasonable businesses, and then they get undercut by unreasonable forces in the economy. We have to find a way to make that stop.
Elle: I agree, thank you so much for speaking with me. Any final words?
Nathan: Thank you for your questions and your interest, but most of all for your experiments. The greatest successes for shared ownership were built on experiments. The Rural Electrification Act in 1936 happened because Roosevelt, when he was governor of New York, saw the experiments among the farmers who were sharing electrical power, and he knew it could work.
These experiments matter so much when it comes to changing the system.
