Abstract
This perspective examines the source of value in Web 2.0 enterprises such as Facebook and Google by analyzing the advertising model that supplies the bulk of their revenues. Drawing on Marx's understanding of the circulation of value within the capitalist economy as a whole and his concepts of unproductive labor, subsumption of labor, costs of circulation, commercial capital, and primitive accumulation, we analyze the economic relationships of Web 2.0 capital, proposing that revenues from advertising come from value produced in non-Web 2.0 sectors of the economy. On this basis we critique both Fuchs's and Arvidsson and Colleoni's positions on the origin of value in Web 2.0 and recognize some of the difficulties and contradictions of the advertising model as a form of monetization of free services for Web 2.0 capital.
Notes
1 . The productive and unproductive labor distinction is controversial within Marxism and beyond. For short presentations of Marx's writings on the subject see Gough (Citation1972) and Rubin (Citation1928/2008). For papers supportive of the distinction and the position taken in this paper, see Leadbeater (Citation1985), Mohun (Citation1996; 2003), and Savran and Tonak (Citation1999). For a critical development of Marx's categories and their application to the current “Digital Labor” debate in ways broadly consistent with the arguments in this perspective, see Huws (Citation2013), which appeared too recently for further analysis here.
2. However, particularly where it provides the only outlet for a producer, commercial capital can become sufficiently powerful vis-à-vis the producer to drive down margins and take most of the value created.
3. Nielsen (Citation2013, 2) notes that “advertisers and agencies think sales generated and brand lift … are the most appropriate metrics to use to determine return on investment [in social media advertising].”