Ben Thompson, Another Viral AI Doomer Article, The Fundamental Error, DoorDash’s AI Advantages:
What is notable about this assertion is the total denial of any positive reason for DoorDash to exist and to be so successful. There is no awareness that DoorDash provided a massive consumer benefit (restaurant food at home) from scratch, that DoorDash massively increased the addressable market for restaurants (or created an entirely new category of ghost kitchens), or that DoorDash provided brand new jobs for millions of drivers. Instead, the Article just sort of takes it as a given that DoorDash exists, and that it is a rent extractor preying on weak-willed humans and their habits.
This is the exact sort of view taken by some of the most frustrating anti-monopoly activists: all large successful tech companies exist not because they created a market with virtuous cycles, solving all kinds of thorny problems along the way, but rather because the government didn’t regulate hard enough, or something.
This illustrates the consistent problem with Ben's analysis of all things anti-monopoly. What Ben is saying can be true and monopolies can be abusive. Google is the best example: everyone I know who strongly opposes Google's monopolistic practices now it has a monopoly also talks about how great it was when it started it. Google deserved to become the number one search engine. But that does not give it the freedom, now it has a monopoly, to abuse it.
Ben's problem is that ultimately he believes that, because a company delivered high levels of value to consumers in its early days, it does in fact have the right to then "extract value" from them in the future.
This view — both in the Citrini Article and from the anti-monopolists — is grounded in a fundamental lack of belief in dynamism, human choice, and markets. DoorDash didn’t always exist: it was built, and it wins through the affirmative choice of all three sides of the market it serves (customers, restaurants, and drivers). Does the company have varying degrees of power over different sides of that market based on its dominance of the other sides? Absolutely, but that power flows from delivering value, not from extracting it.
(My emphasis).
The problem here is that Ben is conflating past and present. There's no doubt that Doordash, or Google, delivered value in the past. However, that does not mean they continue to deliver the same value now. In fact, almost inevitably, they don't. Even at the scale of a company making billions of dollars of profit, "the market" expects profits to keep growing, at not just at a percentage close to the rate of inflation but a lot higher.
Then there are the companies that delivered value early on, but in a way which was never sustainable, and, I would argue, always knew it. Uber is the poster child for this practice. Uber burned through billions in VC money to offer rides at below-cost prices, deliberately pricing out competitors and habituating consumers to cheap, convenient transport. Black cab industries and local taxi firms were systematically undermined.
Once Uber (and to a lesser extent Lyft) had established dominance in major markets, the subsidies quietly evaporated. Prices rose, surge pricing became more aggressive, and driver pay was squeezed — meaning the service got worse for both ends of the platform simultaneously.
Uber isn't a pure monopoly in most markets — Bolt and others still compete in many cities, particularly in Europe. So the extraction has limits. But in cities where it effectively has dominance, the pattern holds clearly.
Does Uber "deserve" its continued market dominance, simply because its backers had deeper pockets than anyone else? Well, in Ben's view, yes – it created value, and he believes continues to create value. But that ignores the fact that the value to consumers has begun to evaporate, while the value to shareholders continues to rise.