Amazon and Netflix are two corporate monstrosities we paradoxically love to hate even as we are closeted about patronizing them. Both companies are heavily invested in the charter school industrial complex and peripheral “education reform” efforts nationwide.
I’m a major proponent of public education and public school teacher unions. Meanwhile, I have a red DVD envelope on my desk as I type this and have used Amazon’s independent publishing platform to release my book Taxi Searchers: John Wayne, Robert De Niro, and the Meaning of America (which you all should buy immediately).
Quite obviously there is something desperately wrong with both companies and with their monopolistic business model. In the film world, we have seen the complete destruction of the once-prosperous video store and it is quite obvious that movie theaters are on the chopping block next.
Granted there has not been a truly goddamned decent American mainstream film in four decades, and even then The Godfather was nowhere near as awesome as Pasolini. [Editor’s note: I will re-watch Pasolini but my initial reaction here is that this is one of the most vile slurs ever committed during the entire course of film history, perhaps — perhaps — tied only with Forrest Gump being awarded Best Picture over Pulp Fiction and Dances With Wolves being picked over Goodfellas. Speaking of Pulp Fiction, isn’t the debate about foot massages great?] [AS response: Pasolini’s public statements on Italian politics, combined with a delightful children’s film titled Salo, or the 120 Days of Sodom, makes corpulent Coppola’s oeuvre look truly pathetic. And the true robbery was not Pulp Fiction (as if we need to be boosting Tarantino’s ego more this week?) as much as Gump being chosen over The Shawshank Redemption, maybe one of the best films of the decade.]
Meanwhile, independent book sellers are on the endangered species list. Bibliophiles have seen retail chains like Borders and Waldenbooks go under while Barnes and Noble has kept its head above water by offering the Nook e-reader and shelving children’s toys along with trendy hipster stationery from Moleskine, an offense that should be no-exception grounds for a lengthy stay at the local re-education camp. [Editor’s note: I could not agree more.]
This is a contemporary re-enactment of the grade school lesson I received on the Rockefellers, Standard Oil and the trust busters. It would seem almost impossible, however, to update that case law precedent from its Gilded Age settings, right?
Not really. In fact, the precedent created by a 1948 case, United States v. Paramount, is easily applied to both companies. In their standard textbook Film History: An Introduction, David Bordwell and Kristen Thompson write:
In 1938, the Justice Department initiated a suit, United States v. Paramount Pictures, Inc. et al., usually called the “Paramount case.” The government accused the Big Five (Paramount, Warner Bros., Loew’s/MGM, 20th Century-Fox, and RKO), and the Little Three (Universal, Columbia, and United Artists), of violating antitrust laws by colluding to monopolize the film business. The Big Five owned theater chains, block-booked films, and used other unfair means to keep independent films out of the big first-run houses. Although the Little Three did not own theaters, they were accused of cooperating to exclude other firms from the market.” Wikipedia further explains “The major film studios owned the theaters where their motion pictures were shown, either in partnerships or outright and complete. Thus specific theater chains showed only the films produced by the studio that owned them. The studios created the films, had the writers, directors, producers and actors on staff (“under contract” as it was called), owned the film processing and laboratories, created the prints and distributed them through the theaters that they owned: In other words, the studios were vertically integrated, creating a de facto oligopoly.”
This description applies almost in absolute symmetry to the methods now being utilized by Amazon and Netflix.
In a legally-operating capitalist system, corporate bodies compete to demonstrate their ability to most efficiently deliver goods and services to one part of a given market. But when they expand to encompass the entire market, which in turn means self-serving contracts and attendant perks of such trade, you have a monopoly.
Amazon not only sells books, it also publishes them. Netflix does not just distribute films for home viewership, it actually produces entire television series and films (some of which are actually decent). Through their tactics and growing market share the two corporations are quickly approaching a concentration of power roughly akin to what existed in 1948 Hollywood.
Of course, the fact that this decision came down in 1948 against the Hollywood moguls is pretty ironic. Simultaneous with engaging in a progressive trust busting drive, the Truman administration was gripped in a mad fever dream known to history as McCarthyism. The Communist Party saw its leadership going on trial for alleged espionage and treason under the Smith Act while the Hollywood Ten and the attendant blacklist began to cast their long shadows.
This was the same year that the Party’s support for the third party candidacy of Henry Wallace, who had been FDR’s second vice president, resulted in him coming in fourth place behind Democrat Truman, Republican Thomas Dewey, and Dixiecrat Strom Thurmond. That was a rather pitiful last gasp by an organization that a decade earlier had been mobilizing thousands in the urban cores of American industry.
None of this would have been possible were it not for the key role played by the film industry. Remember, before the proliferation of the television a few years later, theatrical newsreels produced by the film studios were a significant and important mode of news transmission. Making up the other half of the equation, the studios produced a string of red-baiting films about the Commie threat (even George Pal’s 1953 adaptation of British socialist H.G. Wells’ The War of the Worlds featured red spaceships described as ‘the vanguard’!) and plenty of schlocky cartoons about Stalin’s wrath.
Hollywood’s studio bosses, who were first generation innovative technology entrepreneurs that came from humble working and middle class backgrounds, retreated into this anti-Communist mania for two reasons. First, quite obviously, they were justifiably frightened by the strong antisemitic element of these developments, up to the point that the American Jewish Committee “endorsed the death penalty for the Rosenbergs, while its monthly publication, Commentary, editorialized that they weren’t really Jews,” to quote Norman Finkelstein.
Second, and perhaps less obviously, the studio bosses and top executives loved having the opportunity to blackball anyone trying to unionize their shops as Commies. Their PR campaign sounded plausible because Communist Party USA members were foot soldiers of the huge CIO union organizing drives of the Great Depression. This sort of political landscape and Hollywood’s service on behalf of the status quo would have seemed to require that the anti-trust case not just be decided in favor of the studios but be completely shut down. Yet instead the case went up to the level of the Supreme Court and was decided in a definitely anti-monopoly fashion, with the dissenting opinion delivered by Justice Felix Frankfurter being premised on a technicality of the way the case was presented to the court as opposed to a pro-studio viewpoint.
And such also is the case today with Jeff Bezos of Amazon and Reed Hastings of Netflix when it comes to politics. Both are longtime Democratic donors who pay cash to Congress to ensure that they get the policies they want. Trump is a bit of a wild card here — he’s pissed at Amazon because he charges, with some accuracy, that it uses is subsidiary the Washington Post to create Fake News — but given the industry’s general power in DC, I wouldn’t bet on any serious threats to Amazon’s or Netflix’s exploitation of the public stemming from the two companies’ monopoly status.
However, should the government ever decide to actually prosecute antitrust suits again, something it seems to have stopped doing after the failure of the case against Microsoft at the end of the 1990’s, the Paramount decision would be a great precedent to utilize.