The trend is for corporations to operate like the old feudal estates in ways we’ve never seen before.
The title might seem a bit like gobbledygook, so let me explain what I mean. New feudalism, or “neo-feudalism,” is an observation made by figures from economist Yanis Varoufakis to criminologist Clifford Shearing to billionaire Nick Hanauer that our political and economic structures increasingly mirror those of the middle ages.
One trend is warfare becoming increasingly “medieval,” with corporations and governments employing private military forces like Russia’s Wagner Group, South Africa’s Dyck Advisory Group, France’s Secopex, the UK’s Aegis Defence Services, the UAE’s Black Shield Security Services Company, and the USA’s Blackwater to command and control economic resources, especially in the global south. Meanwhile, the macroeconomic trend, as noted by Katherine Stone and Robert Kuttner, is for financial capital and large corporations to take ownership of the public domain and seize the power to regulate information and the economy.
What we’re going to see in the future is those who have wealth and political power, who can also hire their own private armies now, become superpowers. — Sean McFate
The new trend for large firms is to behave like the old feudal estates in ways we have never seen before. Before the rise of Capitalism, the center of life for many Europeans was the manor, a self-sufficient tract of land bestowed upon a landlord, usually in exchange for military service or as an inheritance. Unlike a business, a manor was a sort of government unto itself, making money not through profit but extracting rents and taxes from lesser lords and peasants who actually worked the land.
As a peasant, you might possess a small landholding that you are responsible for maintaining, almost like a small enterprise. However, up to a third or even half of your productivity would go straight into your landlord’s pocket through rent and fees for using the mills, ovens, roads, and other pieces of property owned by the lord. Through control over the land, a feudal lord acted as the ultimate authority in his own domain, and held court for offenses involving the regulation of his private economy.
“We are born in a Pullman house, fed from the Pullman shops, taught in the Pullman school, catechized in the Pullman Church, and when we die, we shall go to the Pullman Hell.” — Pullman Employee
Although this system mostly died out with the rise of mercantilism, capitalism, and imperialism, it has popped up from time to time. In the late 1800s, car manufacturer George Pullman developed a company town eerily similar to a feudal estate, complete with his own mansion, absolute personal authority over politics, a regime of rent, and limited property ownership among the workers, who were rendered dependent on Pullman services for daily life. Walt Disney attempted something similar in the 1960s with his failed EPCOT project, the remains of which now comprise Disney World, a pillar of the Florida economy in its own special district with exemptions from state law and local democratic oversight. These attempts have historically been fairly common, from the Fordlandia debacle in 1927 to Nevada’s dystopian 2021 legislation proposing autonomous “innovation zones” which would have allowed companies like Blockchains LLC to establish court systems and levy taxes in their own private cities.
Companies like Amazon, Google, Microsoft, and Apple own their own marketplaces where they make huge rents off of capitalists trying to make a profit. They also regulate these marketplaces in ways they see fit, making decisions over who gets to sell, whose products are featured, and what information is displayed to users about these products. — You Own Nothing
What does this have to do with Minecraft? As noted by former Valve economist-in-residence Yanis Varoufakis, many of the salient features of this manorial system have been moving onto our online spaces, adapting to new technologies. The most powerful and pioneering firms have been progressively incorporating new forms of rent and producer control into their business models. Unlike the company town model, this new form of economy is wildly successful and spreading so quickly to every corner of our online economy we barely notice it as something unusual.
Prior to the acquisition by Microsoft, the good old days when I played Minecraft, there was a huge community of enthusiastic players who coded and crafted “mods” and other content for the game. These varied from different “skins” or outfits for your character to completely different graphics to adventure maps to entirely new content, some of which changed the core nature of the game. These mods were built by passionate members of the community and were generally free to download.
This environment changed drastically in 2017, when Microsoft released the Minecraft Marketplace. While a rich free mod community still exists for the Java edition, all other editions require mods be downloaded through the Minecraft Marketplace. As the name suggests, the Marketplace is an economy governed by Microsoft, where private companies produce mods and sell them to users with the special “Minecoins” currency.
Minecraft claims to give over half of the cost of a mod to creators, meaning that the tax for selling on the Minecraft marketplace reaches up to 50%. This is only after the platform takes a cut. For example, if you sell a mod to an iPhone user, Apple will tax it at about 30% before Microsoft takes most of the remaining half. Apple owns the app store, grants space in that store to Microsoft, who then employs small entrepreneurs to produce value with Minecraft infrastructure and intellectual property. If we indulge in a comparison to feudalism, Apple would be the lord, Minecraft a vassal, and modders serfs.
An important aspect of this marketplace is that Minecraft gets to be the primary authority and regulatory agency. For Minecraft, this means carefully curating content and promoting creators who best represent the brand. Microsoft runs a significant formalized international economy through Minecraft, with dozens of companies that employ small teams and freelancers. The functioning of this market is incredibly opaque, with allegations of censorship, stolen content, and massive hidden tax rates.
The Marketplace is only one sector of the Minecraft economy. The other major sector is servers, where people around the world can play and access content together. Minecraft provides a small scale subscription service to host about a dozen friends, but they don’t appear to make direct rents from the really massive servers. Hypixel, for example, reported spending $100,000 a month in 2015 to host their servers, when they had ten to twenty thousand users playing at a time. During their peak in 2021, they had upwards of two hundred thousand.
These servers are generally not hosted by Microsoft, but cloud computing and hosting companies like OVHcloud, Apex Hosting, and Minecraft marketplace partner Team Visionary. Individuals can also set up their own servers, although it can take a lot of computing power and therefore capital. Server hosting is essentially a form of rent, leasing property to make passive income similar to how a real estate company might make rents off of office space.
Minecraft servers went from feeling like that local cafe or business with an owner that would always say hi and maybe give you a discount on your coffee, to a large corporate corporate chain like McDonalds or KFC, ever present, but also ever so lifeless — TheMisterEpic
Because of the very high cost of building a competitive server, along with a complex and expensive promotion environment, the server economy is highly monopolistic, derivative, exploitative, and corrupt. Popular servers make their owners millions of dollars through micro-transactions and membership tiers that can cost up to hundreds of dollars a month. There is very little creativity or innovation because having tens of thousands of dollars to spend on promoting a pay to win Hypixel clone is more viable than spending that money on developing a unique server.
While Minecraft does not make a direct income from these servers, it does benefit immensely from them. Servers make massive amounts of content at very low cost to Microsoft, drawing in users and constantly invigorating their content ecosystem. Minecraft does not have to manage any of these servers themselves, which in turn pull hundreds of thousands of users willing to pour millions of dollars into the Minecraft-run economy. These servers are practically economies unto themselves, complete with virtual stock markets, that bring massive power and prestige to Minecraft’s empire. As in feudalism, the market is cut up into fractal pieces, with economies on top of economies, vassals producing new vassals, and a pyramidal network of owners and producers whose value is extracted to the top.
This system is everywhere. Before the Musk regime, Twitter did not extract a monetary rent from its users, rather converting the value and capital created by its user-base into advertising revenue. Despite the massive amounts of content produced on Youtube, the company supervises and commands that content, often with a heavy and censorious hand, to maximize value it can sell to advertisers with an elaborate automated auction system.
The Minecraft Marketplace itself isn’t so different from the marketplaces provided by big retail platforms like Walmart, Amazon, and Ebay. While they may have operations of their own, increasingly their role is to provide a platform for other businesses to connect and sell to customers, for a fee of course. As a manufacturer or middleman, these major retailers hold the keys to much of your consumer base. If you are not a massive brand in your own right like Nike, you must be careful not violate the unspoken rules of these marketplaces, for fear of being blacklisted. These entities are increasingly flexing their muscle and expanding their realms, testing out the limits of their power.
These systems are not inherently bad. Online marketplaces are a convenient way to connect firms to customers while concentrating economic data and automation tools for the fulfillment of human desire at a level the central planners in Moscow could only have dreamed of. Small creators are able to share and make a living off of their creativity in ways that have revolutionized art, communication, and the spread of knowledge. The Minecraft market holds the potential for an economy based on creative, fulfilling work done to build community and spread joy. The problem is not the technology, but the concentration of power and a perverse market machine driven by the pursuit of money at all costs.
A tempting solution is to treat these platforms as public utilities and nationalize them. Speaking to the Soviet comparison I just made, the potential perils of this decision include creating a destabilizing and hostile atmosphere for property rights and business, as well as an even more egregious concentration of power as the government acquires new tools to manipulate free speech and the economy. The current trend may be a clear and present danger to our economic and personal autonomy, but at least corporate power can be checked by producers, advertisers, governments, and consumers.
My preferred counter to this trend is encouraging the rise of platform cooperatives and community networks. If marketplaces are democratically run and collectively owned by employees and important stakeholders, they may be more inclined to take a community-centric approach, leveling the playing field and shifting governance towards producing human-centric rather than strictly monetary value. Open source projects built by communities and governed as a commons by unions of producers could develop rules that give space to a diversity of projects and a fairer competitive atmosphere with better infrastructure for innovation.
As a culture, we have not begun to grapple with the real implications of these developing technologies and the private economies they have produced. New technologies will not solve our problems within a regressive framework that prioritizes power over people. As increasingly powerful artificial intelligence disrupts the way we do business, perhaps in the same way the internet did, we must ask ourselves whether we’re okay with further concentration of power, dispossession, and new systems of control.
