How Platform Businesses Affect the Economy

The so-called startup platforms realize lowest-price, rocket-speed delivery.
A startup whose value is recognized gets investment from a Big Brother.

Personally, I am concerned about whether the boundary is being blurred: is the Brother briefly coming down to the valley to build a startup, or is the first-class startup being absorbed as a member of the Brother's group? The blatant pattern of business expansion is worrying.

At first platforms were funded by the leading domestic top-tier firms, but over the past few years the platform market has been swallowed up by foreign investment capital.

Actually... investment may look cool. But in the end it is debt. The problem is, while it is super-super-super excess profit for the platform's people, the legal entity becomes a debtor carrying interest at the level of legalized loan sharks.

Getting investment, especially foreign investment, is in practice the ultimate success for individuals and organizations... but the country that is the backdrop of that legal entity's economic activity, and its ordinary citizens, have their economic life become several times more impoverished.

In this way, foreign capital is in effect carrying out financial colonialism, but because the source of the capital is not a single country but a multinational holding of shares, it is very hard to recognize the severity of the problem.

Rather, those who have attracted the investment become role models for society and serve as goals and visions for young people and office workers.

But well, who cares if it is multinational capital?
(Maybe it has a feel like: it was better to do as the Japanese colonial rulers told you and feed your family, rather than get beaten to death by corrupt late-Joseon officials or starve...)
"It's the 21st century, what talk is this? Where are borders these days? Who cares where the capital comes from? As long as consumers get bargains, cost-performance, and benefits right now, that's enough." One can think this way.

And in fact, thanks to the strong ammunition from those Brothers, platforms started what was called "innovation": dawn delivery, half-price discounts, lowest price... offering new kinds of satisfaction called gaseongbi (cost-performance) and gasimbi (price-to-heart-content) and began to take root in the market and in daily life.

But the roots are gradually turning into straws.

The reason is that economies of scale started with the platform's marketing, sales, promotions, and free commissions, but ultimately expanded into distribution, production, and delivery.

To adapt to half prices, sellers began to raise prices.
To do dawn delivery, delivery drivers were squeezed dry, and the sacrifices that followed raised labor costs, and that labor cost was in turn passed on to consumer prices.
Recently, to get around the burdensome labor cost of professional delivery drivers, new delivery formats where ordinary people can deliver directly have been emerging.
In the case of real-estate brokerage... it is even more serious. In the end it results in a rise in rent. When rents face legal restrictions, inflation appears in the form of maintenance fees, parking fees, and so on.

In this way, platforms simultaneously create inflation on both the production and consumption sides.

A more serious, fundamental issue is that in this process, quality and service beyond the platform's (productivity) standard are automatically cut, and once that cut line is crossed, distribution, production, and service areas alike start to be sourced from abroad.

The market's standards for productivity and efficiency are being optimized to the platform's eye level, or more precisely, to the multinational Brother's return on investment.

Recently, many of the products we buy through platforms (even established domestic brands and new brands alike) are imported goods being sold through repackaging and relabeling.

Back in my day, delivery, especially food delivery, was of course free. And food itself was cheaper too. Personally, I think the rise in delivery fees and food prices is driven more by platform commissions, platform marketing costs, and comment/review costs than by labor or ingredient costs.

In this way, domestic production and distribution are being replaced by foreign imports and by delivery done by ordinary people. The consumer's own turf gradually thins out, and what was thought to be "my gain" gradually flips into "dog's gain" [the opposite].

That's it for now