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The Extraction Economy: “The protectors of our industries” cartoon showing Cyrus Field, Jay Gould, William H. Vanderbilt, and Russell Sage, seated on bags of “millions,” on large raft, and being carried by workers of various professions. Credit: Wikimedia Commons/Library of Congress

As the world soured on Big Tech platforms in the “techlash” of the late 2010s, the conversation centered on how technology was harming its users. An avalanche of best-selling books, magazine think pieces, and documentaries sounded alarms about the annihilation of privacy and attention spans, crises of loneliness and teen depression, and echo chambers and political polarization. This era of commentary connected broad societal problems back to the intimate relationship between tech platforms and the individual.

The Age of Extraction: How Tech Platforms Conquered the Economy and Threaten Our Future Prosperity by Tim Wu Knopf, 224 pp.

The Age of Extraction, by the Columbia Law professor Tim Wu, takes a different route to the conclusion that Big Tech is destabilizing society: one focused on the economic relationship between platforms and other businesses. Wu, a founding father of the “neo-Brandeisian” anti-monopoly movement that influenced antitrust policy under the Biden administration, contends that platforms such as Google and Amazon have become essential commercial infrastructure and use this power to extract ever-more value from smaller businesses in the form of exploitative fees and pricing. He calls artificially intelligent platform extraction “the emergent form of economic power in our time,” and suggests that it is a driver of inequality and ultimately the rise of authoritarianism.

This argument won’t be revelatory to those steeped in anti-monopoly debates. Nor does the book serve as an especially persuasive introduction to the topic for those encountering it for the first time. Still, Wu’s writing is lively and lucid and he provides some fresh insights, especially on where the power of platforms is headed in the age of AI, and the dangers this poses to the republic.

The Age of Extraction is divided into two parts. The first delivers a rendition of the familiar Big Tech hero-to-villain story, framed around the platforms’ evolution from “enablement” of economic activity to the “extraction” of value. The second, shorter section looks at the global trend toward political instability and democratic backsliding.

In the optimistic late 1990s and 2000s, Wu reminds us, there was never supposed to be a “big” tech. Pundits predicted that the internet, by lowering barriers to business entry and favoring nimbleness, would usher in a decentralized, egalitarian economy. The business writer Seth Godin declared that Small Is the New Big; the blogger Glenn Reynolds envisioned An Army of Davids replacing old corporate Goliaths. The tech thought leader Jeff Jarvis, in his 2009 book, What Would Google Do?, declared that “the Lilliputians have triumphed. The economies of scale must now compete with the economies of small.”

According to Wu, such predictions were based in part on the perception that new tech platforms like Google and Amazon were “public-spirited town squares that existed to help others, almost like corporate charities.” The platforms played into this perception—especially Google, with its famous “Don’t Be Evil” slogan. A letter the company’s founders Larry Page and Sergey Brin wrote to investors in 2004 explained that Google would do “good things for the world even if we forgo some short-term gains.” But in the early days, they also lived up to it. Amazon created Amazon Marketplace, which empowered countless Americans to start small businesses using its built-in customer base and logistics capabilities. In return, the company asked only for a reasonable fee: about 19 percent of a seller’s revenue as of 2014.

In the optimistic late 1990s and 2000s, Wu reminds us, there was never supposed to be a “big” tech. Pundits predicted that the internet, by lowering barriers to business entry and favoring nimbleness, would usher in a decentralized, egalitarian economy.

But as Amazon cemented itself as the dominant e-commerce platform—in large part by subsidizing shoppers and hoovering up potential rivals—it began to put the squeeze on sellers. It ratcheted up monthly fees and introduced a major implicit fee by placing rows of sponsored results at the top of search results pages. (By 2024, sellers were paying Amazon more than $56 billion per year to make their products visible.) By 2023, fees averaged more than 50 percent of sellers’ revenue. And yet, with Amazon commanding such a large market, sellers couldn’t walk away. Wu shares anecdotes of entrepreneurs who built thriving e-commerce businesses largely through Amazon, only to be put out of business as the fees mounted up.

If Wu wanted to persuade readers that we are truly living in an age of extraction, some additional case studies might have been helpful. Journalists such as the Washington Monthly’s Phillip Longman have compared Big Tech platforms to the railroad monopolies of the Gilded Age for the better part of a decade. There are plenty of other examples to choose from. Google’s dominance in “ad tech,” the stack of platforms connecting advertisers and web publishers, allows it to extract 30 percent of publisher ad revenue through various fees. Apple’s commission on iOS in-app purchases reached 30 percent before a recent court ruling forced the company to allow app developers to route purchases through their own websites. Uber’s “take rate” on ride fares is dynamic and opaque, but it increased dramatically in recent years and has been shown to range from 40 to 70 percent.

Puzzlingly, The Age of Extraction leaves these examples on the table, not even giving them a brief mention. Readers might be left wondering if platform extraction is a problem that extends beyond Amazon as Wu moves ahead to explore tangentially related topics. One chapter observes that the internet failed to translate into “the rise of a new creative class holding significant wealth,” and that even the influencers who have found financial success are “a laboring class” with stressful lives—although it does not tie this reality to any specific extractive practices by platforms. (Wu doesn’t mention, for example, content creators’ paltry share of YouTube and X ad revenue.) Another chapter describes how private equity roll-ups of specialist medical practices raise patient costs while degrading quality of care, and how the mega-landlord Invitation Homes has exploited renters by consolidating local housing markets and then systematically raising rents and piling on absurd “junk fees.” Wu argues that these phenomena represent “platform power beyond tech,” because private equity-backed medical groups bill themselves to doctors they hope to buy as convenient administrative intermediaries, and Invitation Homes uses technology to buy and manage thousands of homes.

The freshest material in The Age of Extraction comes in Wu’s analysis of how Big Tech is diversifying and augmenting its platform ecosystems to maintain their power. Wu describes Google, Apple, and Amazon’s splashy ventures into entertainment and sports broadcasting as an effort to become “fully spun cocoons of life and living.” And, of course, the platforms are now “investing heavily in owning or controlling the relevant talent, data, and technologies” of the AI race. OpenAI and Anthropic are backed by Microsoft and Amazon, respectively; Google, Meta, and Elon Musk’s X are developing popular models in-house and control key distribution channels. Thus while AI technology may disrupt certain Big Tech products, Wu points out that AI market structures appear “headed in the direction of reinforcing [Big Tech’s] advantage.”

Just a few decades ago, Francis Fukuyama was predicting The End of History, “the old dictators, cranky old men, were on their way out,” and “a kinder, gentler future was meant to be on its way in,” Wu writes. “What went wrong?” His answer is a bit slippery, particularly with respect to how much weight it assigns to the tech platforms that are the main subject of his book. At first he blames “the destabilizing effects of laissez-faire capitalism,” and concedes that “the tech platforms are not nearly the entirety of this story.” At another point, he blames “the emergence of platform capitalism and broader trends in the economy.” The theory he actually fleshes out centers on corporate consolidation generally, although the tech platforms certainly fit in.

Wu sketches the progression from consolidation to authoritarianism as a “sequence in five steps, each based on known and well-studied tendencies.” Monopolization is followed by extraction, which, “by its nature … creates a narrow class of winners” and a “broader class” of losers: “consumers who pay more, workers who are paid less, and local, regional, smaller, and medium-sized businesses that are acquired or driven out of business.” This inequality leads to the emergence of mass resentment, then democratic failure—“compounded if the state is understood or credibly portrayed as supporting and perpetuating the ongoing extraction”—and ultimately the* rise of the strongman*. In a play on the title of the libertarian economist Friedrich Hayek’s iconic book, Wu calls this progression “the real road to serfdom.”

He presents this as a sort of natural law, and doesn’t make much of an effort to support it empirically. That’s not much of an issue with respect to the latter part of the causal chain, as the link between inequality and resentment and political instability is fairly self-evident. But readers might need some evidence to be satisfied that monopolization is a significant driver of inequality to begin with. Wu could have mentioned the work of the economists Marshall Steinbaum, José Azar, and Ioana Marinescu, who have connected employer concentration in labor markets to lower wages. From the consumer perspective, he could have surveyed anti-monopoly research into how consolidation is making household cost centers like health care and groceries more expensive. Or he could have deployed a historical example, such as that of the Gilded Age, to illustrate his point. But as with his argument about platform extraction, Wu declines to elaborate.

Nevertheless, The Age of Extraction concludes—after a few short chapters taking down the ideas that markets are self-correcting and that crypto technology will solve inequality—by presenting policy solutions to the expansion and abuse of monopoly power as a broad “architecture of equality.” The solutions begin with antitrust. Wu mentions that antitrust enforcement “staged a comeback” under the Biden administration and lists major cases, although he doesn’t explain how specifically they could mitigate extraction. Other solutions could include utility-style regulation and price caps, which Wu points out have proved successful beyond the utility sector. For instance, “swipe fees” are capped in the European credit and debit payment processing markets. New “common carrier” rules, such as those historically used to govern railroads and telecommunications networks, could prevent dominant tech platforms from discriminating in favor of their own products or services. And quarantines and “line of business” restrictions could prevent platforms from leveraging their preexisting monopolies to dominate new markets, such as artificial intelligence.

At around 200 pages,* The Age of Extraction* is a fun and breezy read, and it will hold the attention of casual readers even if they do not end up convinced of its grandest claims. But for neo-Brandeisian true believers, the book is likely to frustrate. At a pivotal moment for the movement, with its Biden-era champions out of power and the Trump administration reversing much of their agenda, Wu is content to retread familiar intellectual territory rather than illuminating what comes next. And amid a contentious factional battle to shape the future of the Democratic Party, the thinness of the book’s argumentation makes it unlikely to win hearts and minds. For an advocate of Wu’s talents, The Age of Extraction represents a missed opportunity on multiple fronts.

Kainoa Lowman is a communications associate at the American Economic Liberties Project, an anti-monopoly research and advocacy group. He writes for AELP’s newsletter, The Economic Populist. More by Kainoa Lowman