Zheng Han: An Analysis of Techno-Feudalism as a New Form of Monopoly Capitalism
Since entering the digital age, the Western Left has been seeking new theoretical frameworks to explain news changes in capitalism and to find an exit toward a new society. Among these, the perspective of "technofeudalism" proposed by scholars such as Cédric Durand and Yanis Varoufakis has been one of the most prominent theoretical trends in recent years. Whether in terms of research interest or social influence, technofeudalism has undoubtedly been a successful theoretical endeavor. From the perspective of theoretical content, its series of analyses and assertions have accurately outlined various new facets of the digital age, providing profound insights into the malaise of contemporary capitalism. However, a detailed dissection reveals that many of the concepts and issues involved in technofeudalism do not exceed the scope of Marx's thought; many of its judgments not only fail to continue Marx's analytical logic but even move in the opposite direction.
I. Technofeudalism: An Attempt to Conceptualize a New Form of Capitalism
As a trend of thought, technofeudalism is the latest attempt by contemporary Western Leftist scholars to conceptualize a new form of capitalism. Its background lies in the epochal progress and large-scale application of digital technologies—such as the Internet, the Internet of Things (IoT), big data, cloud computing, and artificial intelligence—and their deep reshaping of production and daily life. In his book Technofeudalism: What Killed Capitalism, the former Greek Finance Minister and economist Varoufakis repeatedly emphasizes that the core question he seeks to discuss is whether the technical network system composed of electronic computers and other facilities "will make capitalism even more unshakeable, or will it finally expose capitalism's fatal weakness?" Diverging from theoretical views and propositions such as "digital capitalism," "platform capitalism," and "digital imperialism," proponents of technofeudalism argue that capitalism has not moved forward but has instead regressed into a worse era characterized by feudal features. However, putting aside the claims of Right-wing scholars standing on a pro-capitalist political footing, the views of Leftist scholars who hold a technofeudal cognitive framework are not entirely identical. For instance, the famous French economist Durand refers to it only as the "technofeudal hypothesis" and provides highly cautious definitions for concepts such as "feudalism," "re-feudalization," and "land rent" [1]. In contrast, Varoufakis appears more radical, directly declaring that technofeudalism has killed capitalism: "My hypothesis is that capitalism is already dead, meaning its dynamics no longer dominate our economy." Nonetheless, there remain many commonalities in the discourses of Western Leftist scholars surrounding technofeudalism, which can be summarized into "three discoveries."
First, the discovery of a shift in the mode of capitalist profit extraction. The core thesis of technofeudalism is the identification of "feudal" characteristics in the digital age. The footing of this judgment is that tech giants, by virtue of digital technology, occupy a monopolistic position in the global economic system, thereby changing the primary profit-making mode within the capitalist economic structure. Specifically, regarding the extraction mechanism, tech giants no longer directly employ and exploit laborers like traditional industrial capitalists. Instead, through their monopolistic positions, they earn "technical rents" from stages of the value chain. As Durand puts it: "Although the exploitation of labor still plays a core role in the formation process of global surplus value, the current specificity lies in capital utilizing capture mechanisms to profit from this global total of surplus value, while simultaneously reducing its direct participation in exploitation and detaching itself from the production process." Varoufakis, meanwhile, believes that tech firms have obtained a type of "cloud rent" based on the monopoly of digital technology. Regarding the relationship of interest transfers, this extraction mode resembles the landlord aristocracy of the feudal era; "cloud lords" need only rely on their control over "cloud fiefs" to receive a continuous stream of profit "tributes" from peripheral or subordinate capitalists.
Second, the discovery of a realignment in capitalist class relations. Proponents of technofeudalism argue that not only have digital capitalists transformed into cloud landlords, but the proletariat at the other end of the class antagonism is also undergoing a qualitative change. In Varoufakis's view, the proletariat is divided internally into "cloud proles" and "cloud serfs." The former refers to workers still laboring in traditional industrial workplaces whose labor process is intervened in or even directly controlled by platform technology; the latter refers to those digital users who labor diligently and spontaneously every day to produce precious data for cloud capital, continuously contributing their time, energy, and wisdom to the reproduction of cloud capital for free. In short, whether they are digital laborers or digital users, their own labor processes and behavioral habits are guided and controlled by technology. The relationship between the proletariat and digital capitalists thus transforms into a dependency relationship similar to that of serfs to lords in the feudal era, where the former receives the "protection" of the lord while surrendering their labor and most of their output for free. Durand essentially proposes a similar claim and hints at the difference in "autonomy" between digital users and digital laborers. He believes that producers face absolute constraints, as any company or platform worker becomes part of a digital environment. Although restrictions on consumers are not absolute, staying away from big data would marginalize one's position in society—a choice no different from the medieval peasant's choice between dependency or flight. In general, technofeudalists are convinced that changes in class relations reflect a qualitative change at the level of the relations of production: "The dependence of individuals and organizations on the monopolistic control structures of data and algorithms constitutes the foundation of digital relations of production."
Third, the discovery that the pillars of capitalism—the market and profit—are shrinking and collapsing. On one hand, technofeudalists believe that "cloud fiefs" are encroaching upon the market. Varoufakis pointed out in an interview that "a new system is replacing capitalism." In his work, he uses a small town as a metaphor: "where all the shops, even all the buildings, belong to a man named Jeff (referring to Jeff Bezos—author's note)." This is clearly an identification of tech giants who master digital platforms, algorithmic technology, and intelligent networks. There, the actions and thoughts of everyone are intervened in and controlled by algorithms. Within this entire space, the conversations, negotiations, bargaining, and self-organization of the traditional free market no longer exist. The algorithm becomes the supreme monopolist and arbiter, replacing the "invisible hand" of the market; any subject that does not obey algorithmic instructions and supervision will be expelled from this realm, losing their means of survival. On the other hand, technofeudalists believe that "cloud rent" has replaced profit. Varoufakis's basic judgment is that "for the first time since the rise of capitalism two and a half centuries ago, profit is no longer the fuel for the global economic engine, nor the driver of investment and innovation." Relying on their absolute monopoly, tech giants control the economic lifeblood, standing above other industrial and commercial capitalists, and relying on cloud fiefs to extract massive "rents."
Clearly, technofeudalism has already become a theoretical whirlwind, successfully triggering a new round of critical discussion on the relationship between digital technology and capitalism. Most Leftist technofeudalists possess a conscious alignment with Marxist theory. For instance, Varoufakis stated: "This book (i.e., Technofeudalism: What Killed Capitalism) fits perfectly within the tradition of Marxist political economy. I wrote it as a scholarly Marxist work." Durand also stated: "I chose to start from a pair of classic concepts—what Marx called the 'relations of production' and the associated 'productive forces'." Despite the sincerity of these confessions, we must return to the theoretical context of Marxism to understand the various characteristics and contradictions presented by temporal developments, and to reflect on the roles and impacts of digital tech giants in the global economic structure under the background of technological change, thereby revealing both the innovations and the deficiencies of the technofeudalist perspective.
II. Functional Capitalists, Not "Feudal Lords": Digital Tech Giants in the Circuit of Capital
Within the horizon of the Marxist theory of the circuit of capital, capital that produces or realizes surplus value is called functional capital, which primarily includes two forms: industrial capital and commercial capital. Industrial capital directly participates in production, while commercial capital serves the circulation of commodities. The true nature of digital tech giants is that of functional capitalists. To achieve capital accumulation, enterprises must continuously participate in the process of the circuit of capital, intervening in the stages of production and circulation to appropriate more surplus value. However, the core view of technofeudalists is that the role of tech giants in the production and distribution of surplus value has undergone a qualitative change—they are no longer the drivers of competition and innovation, but have become "lords" who rely on technological monopolies to levy rents on industrial and commercial capitalists. This judgment not only overlooks the structural position of tech giants in the global capitalist production network but also blurs the division of labor and differentiation within the bourgeoisie.
(1) Digital tech giants as industrial capitalists: Organizing the R&D and application of digital technology
The primary identity of digital tech giants is that of industrial capitalists, which needs to be understood on two levels. First, from the perspective of the movement of money, the money investments of tech giants successively undergo three stages: money capital, productive capital, and commodity capital, following the formal requirements of the circuit of industrial capital. In the purchase phase, tech giants buy means of production and labor power in the commodity market and labor market respectively. The former primarily involves procurement from equipment manufacturers or R&D institutions; for example, in 2023, Google's parent company (Alphabet) spent approximately $20 billion on information and communications technology, much of which was used to purchase software, information services, and networking and communications equipment from suppliers. The latter refers to hiring qualified technical labor. In the production phase, labor power is combined with various means of production (factors) such as computers, storage, and data to produce technical products—including algorithms, technical networks, and intelligent control platforms—according to market needs, such as various types of apps, smart devices, and professional technical services. In the sales phase, the tech company returns to the market to sell the intelligent products, algorithmic software, or technical services, completing the valorization of capital. According to Marx's formula for the circuit of capital, digital capital undergoes a complete cycle, and in this process, it completes the exploitation of laborers, appropriating surplus value for free and achieving the valorization of capital. Throughout the entire circuit, tech giants are not "landlords" who drift outside without engaging in production; rather, they are "capitalists" active in every link, playing the roles of organizers of digital technology R&D and providers of applications.
Second, from the perspective of value production and distribution, the goal of tech giants is to extract the surplus value produced by wage labor. On one hand, tech giants directly appropriate the surplus value created by technical labor. Unlike traditional industries, the digital technologies and services produced by tech companies primarily exist as "intangible assets" in non-physical forms such as code and algorithms. Why should this type of technical or mental labor, which does not produce physical commodities, be regarded as productive labor? When analyzing labor in the transport of commodities, Marx pointed out: "The result of the labor expended in transport is a change in the use-value... this is a determination relative to the use-value of the commodity" [2]. Transport labor is defined as productive labor precisely because "labor and the use-value of the commodity form a necessary technical connection"; otherwise, the commodity would not be a commodity, and its use-value could not be realized. Similarly, the digital technology produced or created has been integrated into machines and tools, constituting a part of constant capital and playing a role in the formation process of a commodity's use-value. Therefore, the R&D labor of digital technology also creates value; otherwise, the equipment could not become "intelligent" equipment. On the other hand, tech giants can plunder the surplus value created by digital laborers situated at the periphery of the tech giants (primarily digital platforms). In the eyes of technofeudalists, this is the "rent" paid to tech giants by industrial capitalists and digital laborers. In reality, the mode of capitalist accumulation has always been divided into productive and non-productive categories: there is both productive accumulation occurring in the sphere of production and non-productive accumulation that plunders surplus value through non-productive means such as violence or speculation. It is precisely by virtue of digital technology monopolies that tech giants can, without directly intervening in production, plunder other capitalists and laborers. In short, no matter what method tech giants use to extract profit, the essence is the appropriation of surplus value created by wage labor, which is the core characteristic of the capitalist mode of production.
(2) Digital tech giants as commercial capitalists: Promoting information docking and supply-demand matching
Digital technology giants also play the role of commercial capitalists, claiming a share of commercial profit from the total surplus value realized within society. Marx described the transformation of a commodity into money as the "salto mortale" (deadly leap) of the commodity, noting that "if it fails, it is not the commodity that is broken, but the possessor of the commodity." [3] Building upon data analysis, digital giants dedicate themselves to improving the matching efficiency between information and supply and demand, facilitating transactions of goods and services, and accelerating the realization of surplus value, thereby alleviating to some extent the contradictions inherent in this "leap." On one hand, tech giants construct digital platforms to help settled merchants or service providers connect with consumers, achieving supply-demand matching through product displays, service introductions, information searches, and customer service communication. On the other hand, tech giants utilize the user data they control to develop the attention economy. They not only collaborate with traditional commercial capital to expand product exposure but also cultivate internet celebrities, host marketing events, and design algorithms to attract and distribute traffic, thereby guiding public consumption choices and even shaping consumption habits. Only by constructing vast digital platforms and complex algorithmic systems, and by mastering massive amounts of user data and market information, can they accurately analyze market demand, predict consumption trends, and formulate effective commercial strategies and promotion mechanisms accordingly. Clearly, while tech giants appear to collect rent by utilizing the cloud realm, they must in fact provide technical services in traffic diversion, promotion, and sales for the individuals or enterprises selling goods and services before they can siphon off their own share of the realized surplus value.
From this, it is evident that tech giants, acting as commercial capitalists, possess two distinct characteristics. First, they rely on their own monopoly position in the field of digital technology to join other industrial and commercial capitalists in appropriating the surplus value created by wage laborers, participating in the equalization of the rate of profit. This also reflects the difference between tech giants and "feudal lords"; the latter, after leasing land to a capitalist, often only need to sit back and collect rent without needing to maintain the land itself. Historically, it was precisely around the upkeep of land that capitalists and landlords engaged in repeated maneuvering and long-term struggles. Whether acting as industrial or commercial capitalists, digital tech giants have not transformed into complete "rent-seekers" who reap where they have not sown; they consistently maintain productivity in the technical field, continuously investing high-skilled labor and massive capital to maintain and upgrade platforms, networks, and equipment, and to perform data analysis. Second, tech giants are currently, or have already, merged multiple functions such as advertising, promotion, and sales services, while simultaneously collaborating with other commercial capital to build a commercial network with significant influence and strong user stickiness. Looking back at history, commercial capital separated from industrial capital as a portion of industrial capitalists ceased to participate directly in production, instead using their capital specifically to engage in the buying and selling of commodities. The change brought by digital technology lies in the fact that it has prompted a historic recombination of industrial and commercial capital within the single economic entity of the digital tech giant.
(3) Competition and Innovation Remain the Fundamental Means for Tech Giants to Achieve Capital Accumulation
Compared to the "constant unrest and constant movement" of capitalism, the feudal era was characterized to a large extent by developmental stagnation. Proponents of technofeudalism see a rigid hierarchical structure under technological monopoly and believe the economic system is stagnating due to a loss of momentum for competition and innovation. For instance, Yanis Varoufakis argues: "These cloud capitalists are also freed from the market pressure to produce cheaper and better products; they do not have to worry constantly that a competitor will launch a product to steal their customers." On the contrary, the digital economy has flourished on the basis of competition and innovation, and competition among tech giants remains ongoing and increasingly fierce.
First, digital capital cannot avoid competition. Although digital enterprises and platforms do not focus on producing material products, they have an infinite pursuit of algorithmic computing speed, matching efficiency, and data collection and analysis capabilities. Developing software and programs with specialized features is the core competitiveness for attracting users and earning revenue. Varoufakis attempted to further explain that this competition "is not because it charges less or provides a higher quality of 'friendship' or connection," and that "competition between fiefs should not be confused with market competition." However, he overlooks the exclusivity of attention and the users' rights to choose and exit. Regarding exclusivity, once a user enters a cloud domain or enjoys a service provided by a specific digital platform, they generally cannot utilize other platforms at the same moment. That is to say, raw data is not inexhaustible, and extreme competition exists between tech giants in attracting user attention (or usage time). Taking digital social media as an example, whichever platform provides the most timely, effective, and interesting content will harvest more loyal users and longer usage times. Regarding the right to choose and exit, users can register for multiple platforms with similar or identical functions simultaneously. Upon entering a cloud domain, it is not impossible to exit; rather, users can switch or replace services at any time. Their degree of dependence depends on whether the digital platform can continuously meet user expectations or satisfaction. This feedback mechanism forces enterprises to constantly update algorithms and improve matching efficiency, while making adjustments at any time based on user habits—a market behavior that accords with the needs of capital accumulation.
Second, tech giants must maintain the drive for innovation. Digital enterprises cannot, like feudal lords, construct self-contained and exclusive technological fiefdoms, nor can they be satisfied merely with establishing cyberspace and infrastructure. They must spare no effort in optimizing algorithmic programming and system architecture, constantly innovating technology to occupy the commanding heights of the market. In particular, the influx of vast amounts of idle financial capital into the cloud computing field has not only accelerated the pace of innovation but also intensified digital competition. The "unrest and change" in the cloud realm is even greater than that in traditional industries. Globally, a McKinsey macroeconomic survey of 40 countries showed that digital capital investment accounted for only 0.8% of the surveyed countries' GDP in 2005, a figure that reached 8.5% by 2013. At the corporate level, among the ten companies with the largest global R&D expenditures in 2023, eight were digital tech giants or related upstream/downstream enterprises. Amazon alone invested $85.622 billion in technology and infrastructure (including R&D). From 2019 to 2022, Alphabet's (Google) R&D expenditures were $26 billion, $27.6 billion, $31.6 billion, and $39.5 billion respectively. In 2023, this figure reached $45.4 billion, equivalent to the total economic output of Bolivia for that same year. It is noteworthy that, in addition to independent innovation, tech giants can use their massive funds to merge with or acquire new tech start-ups to block competitors from mastering potentially disruptive technologies. Whether a new invention or acquired technology is applied often depends on the giant's cost-benefit assessment; such behavior that hinders innovation is itself a capital accumulation strategy based on corporate self-interest.
III. Wage Laborers, Not "Feudal Serfs": Labor and Digital Users under Technological Control
While digital technology redistributes economic power, it also reshapes the forms of labor. On one hand, wage laborers are no longer confined to factory workshops and office buildings but can work from anywhere with an internet connection using mobile phones or computers. On the other hand, various emerging occupations have surfaced, from programmers, data annotators, and AI trainers to e-commerce sellers, livestreamers, and content creators. These jobs based on smart devices have blurred the boundaries between labor and leisure, and between production and life.
(1) Cloud Technology Control over Digital Laborers as Producers
Proponents of technofeudalism argue that digital tech giants no longer need to intervene directly in the labor process, or that their relationship with wage laborers has become alienated. For example, Varoufakis argues: "The reproduction of cloud capital can occur without involving wage labor." Such judgments depart from the facts. Cloud technology not only directly controls a vast number of productive laborers but also influences the labor process across various professional roles by transforming the labor market.
Specifically, digital labor can be divided into two main categories: one is based on online platforms where workers are assigned tasks or work remotely, including knowledge services, design and software development, and image annotation; the other is based on location-linked platforms where tasks are completed at specified geographical locations, such as ride-hailing, food delivery, and on-site domestic services. Tech giants maintain close technical and power relations with both types of digital labor. At the level of technical relations, employees must expend significant time and energy to maintain the production and reproduction of digital capital, ensuring that digital technology, smart networks, and terminal devices continue to operate and update. Precisely due to technical requirements, tech giants—whose organic composition of capital is much higher than that of traditional industries—must still maintain an enormous number of employees. In 2023, Amazon had over 1.5 million employees, Alphabet (Google) over 180,000, and Meta nearly 70,000. As products of capitalist relations of production, digital laborers sustain the production and reproduction of capital. Tech giants can only appropriate and distribute surplus value by relying on digital labor. As some scholars have pointed out: "The capital-valorizing nature of technofeudalism still lies in the acquisition of surplus value; this is essentially no different from the industrial era of Marx’s time. The difference lies in the expansion of the channels and objects through which surplus value is acquired." Contrast this with feudal serfs, whose labor was mostly used to produce goods for basic subsistence, with the remainder being usurped and appropriated by the feudal lord in the form of surplus product.
At the level of power relations, tech giants exercise direct control over digital labor. Beyond direct employment, a more controversial point is how to understand the relationship between tech giants, following their platformization, and "flexibly employed" labor. Legally, no formal employment relationship exists between the platform and the individual laborer. However, digital platforms exert de facto supervision and control over the workforce. The service agreement terms provided unilaterally by the platform not only stipulate work hours, wages, etiquette codes for customer service, applicable laws, and data ownership—matters directly related to digital labor conditions—but also determine the worker's grade, commission rates, and daily experience through algorithms and rating management. At the same time, the operational mechanism of platform enterprises involves obtaining demand intentions from consumers and allocating them to product or service providers, with income then split between the platform and the laborer upon completion. This is no different from the "order-allocation-production" logic of traditional industry, except that formally, wages are transformed into the laborer's individual income and corporate profits are transformed into platform commissions. This formal change cannot mask the substantive labor-capital relationship. The so-called absence of an employment relationship is merely a strategy by which digital capital utilizes technological advantages and legal loopholes to reduce the cost of wage labor.
(2) Digital Users as Reproducers of Labor Power in Cyberspace
Digital users are undoubtedly vital contributors to the construction of cyberspace. Proponents of technofeudalism have keenly noted the importance of data and the act of producing data. For example, Varoufakis argues that the most valuable part of cloud capital is not the material equipment but the diverse data from wide-ranging sources, such as "stories posted on Facebook, films uploaded to TikTok and YouTube, photos on Instagram, jokes and abuse on Twitter, reviews on Amazon." Tech giants organize technical staff to create the interconnected cloud world, but without the participation and use of digital users, the cloud would be a hollow shell with technical architecture but no actual content, unable to become a new space in any true sense.
Another argument made by proponents of techno-feudalism stems from a misunderstanding of the Marxist category of labor. They contend that producing data in the "cloud" domain constitutes a form of unpaid labor, and that dependence on digital technology is a symptom of digital users being reduced to modern "feudal serfs." If we return to the Marxist theory of the reproduction of labor power, this argument clearly does not hold. Within the capitalist mode of production, wage laborers are both producers of commodities and reproducers of labor power. To ensure that labor power continues to be funneled into production without atrophy, its reproduction requires necessary rest, entertainment, and education. At the level of appearance, digital users entering the cloud domain manifests as digital consumption or data production; however, for the vast majority of users, they do not act with the purpose of laboring. Rather, they act to satisfy their own life needs and social requirements, achieving the reproduction of labor power with the assistance of digital platforms. On one hand, by sharing and acquiring information, digital users complete the rest and relaxation of body and mind through processes of communication and entertainment. On the other hand, many daily needs that satisfy the reproduction of labor power—such as medical care, food, education, and transportation—are now connected to digital platforms. Digital users must rely on corresponding cloud services to maintain their survival and development. Objectively, the online behavior and interactions of digital users provide valuable data resources for the production and reproduction of digital capital, becoming part of cyberspace. Yet, this behavior is essentially different from material labor or productive labor in the Marxist sense. By erroneously equating the behavior of digital users in cyberspace with labor in the feudal era, proponents of techno-feudalism not only fail to reveal the true nature of digital users' leisure, entertainment, and self-creative activities in cyberspace, but also dissolve the boundaries between production and life, or labor and consumption, thereby obscuring class differences and the contradictions between labor and capital.
(3) The Dominance of Capital over Labor Power: From the Labor Process to Daily Life
The phenomenon of the proletariat's dependence on cloud capital revealed by techno-feudalism theorists reflects the strengthening of capital's power to dominate laborers in the digital age. This intensification is manifested both in the labor process becoming increasingly beyond the laborers' own control, and in the direct intrusion of capital's power into the daily lives of laborers.
Under the aegis of digital technology, the real subsumption [4] of digital labor to capital has further deepened. In order to appropriate more surplus value, capitalists must forcibly extend the working time of workers beyond the cost of the reproduction of labor power, which requires capitalists to exercise corresponding management and supervision over laborers. When analyzing large-scale machine industry, Marx pointed out: "Science, gigantic natural forces, and social mass labor are all embodied in the system of machinery, and together with the system of machinery, constitute the power of the 'master'." Under capitalist relations of production, technological progress only strengthens the technology owner's control over labor power; digital technology elevates this control to a new height. First, there is the precision management of labor time and the labor process. Every link of digital labor can be transformed into data. Algorithmic systems can automatically perform hierarchical classification, performance evaluation, and the determination of rewards and punishments for laborers. Traditional interpersonal management models have been transformed into more efficient and severe digital discipline. Second, the de-socialized characteristics of labor are becoming increasingly prominent. While the wide application of machinery and automated assembly lines led to the deskilling of workers, digital technology further segments digital laborers into isolated individuals. Laborers form a deep binding relationship with digital platforms, making it difficult not only to establish independent close links with markets and consumers, but also severely restricting mutual connection among workers. Third, the trend of mobility in the industrial reserve army has significantly intensified. Digital technology allows the industrial reserve army to truly become a "call-on-demand, discard-after-use" reservoir of labor power. This low-cost yet legal employment model has become the core competitiveness for the capital accumulation of tech giants.
At the same time, by privatizing and commercializing data, tech giants have achieved increasingly precise interventions into the daily lives of workers. In cyberspace, the massive amounts of data generated by digital users browsing pages, sharing information, and participating in discussions are transformed by digital enterprises into enormous economic interests and social power. Tech giants utilize data analysis technology to gain deep mastery of key information such as users' basic profiles, behavioral habits, consumption preferences, value orientations, and emotional dynamics. They guide user behavior through algorithms and use data to continuously optimize intervention mechanisms, aiming to precisely match information, manufacture consumer desires, and even directly shape users' consumption habits and values. This intervention has transcended the realm of ideology and penetrated into people's daily lives. People have become accustomed to the guidance and manipulation of algorithms, making it difficult to perceive the discomfort of being controlled, and even harder to find a way to escape. Techno-feudalism theorists have accurately grasped the contemporary characteristic of digital users' high dependence on cloud technology, but this does not mean that cloud capitalists are equivalent to feudal lords. From the perspective of "technological colonization," for the purpose of opening new markets, creating new growth potential, and seeking profit maximization, tech giants use digital technology to penetrate more layers of human life. This is essentially the commodification and marketization of non-commodified private time and space. In other words, digital users, like digital laborers, have become an important component of the capitalist production system; their behaviors and habits maintain the production and reproduction of digital capital.
IV. Monopoly Capitalism, Not Techno-Feudalism: Digital Tech Giants Construct Global Monopolies
Relying on digital technology, tech giants are breaking through the boundaries of time, space, and industry on a global scale with unprecedented speed and volume, constructing a vast system of global monopoly. As Lenin said, "One of the most typical features of capitalism is the rapid process of the concentration of production in ever-larger enterprises." This trend is even more evident in the digital age: not only are production and sales decisions increasingly controlled and influenced by tech giants, but knowledge and technology are also concentrating in a small number of tech companies at an unprecedented rate. On the surface, tech giants seem to occupy "cloud territories" and sit back to enjoy the fruits, as if promoting a "re-feudalization" [5] of society. However, from the perspective of Marxist theory, this is the inevitable result of the global expansion of digital capitalism.
(1) Monopolizing Cyberspace: The Expansion and Partitioning of the Cloud Domain
Tech giants such as Google, Amazon, and Apple occupy dominant positions in the cloud market by virtue of their powerful data processing capabilities and algorithmic advantages. At the technical level, tech giants adopt methods including appropriation mechanisms based on internal R&D, acquisition mechanisms based on external mergers and acquisitions, and lock-in mechanisms based on intellectual property rights to monopolize technology and consolidate their first-mover advantage in the cloud domain. At the strategic level, they exclude small and medium-sized competitors through means such as traffic distribution, massive subsidies, equity investment, and the setting of industry standards, while pushing precision advertising and services to continuously expand their market share.
Currently, the R&D and production of cyberspace and its core supporting facilities have been partitioned by leading enterprises. There are approximately 10–15 top-tier cloud service providers globally. Regarding the cloud infrastructure used by applications and websites, the "Big Three" of US Silicon Valley together control nearly 70% of the world's cloud computing market. As of the first quarter of 2024, Amazon Web Services (AWS) holds a 31% global market share, while Microsoft Azure and Google Cloud account for 25% and 11% respectively. In terms of digital services, tech giants hold leading positions in their respective areas of strength. "Giant enterprises have gained control over specific markets, essentially becoming gatekeepers who control access to these markets and setting rules for the vast number of enterprises, public services, and communities trapped within their powerful gravitational fields." For example, in the field of search engines, Google alone holds nearly 92% of the market share; in terms of mobile operating systems, Google and Apple divide the world, possessing 70.5% and 29% of the market share respectively. In the digital advertising market, Google alone has a 39% share, while Amazon and Meta (formerly Facebook) account for 7% and 18% respectively. The concentration in the e-commerce field is relatively lower, with Alibaba holding a 24% share and Amazon 13%. Competition in social media is fierce, with Google and Meta holding 14% and 44% market shares respectively, while the latecomer ByteDance has seen its share rise to 11%. At the regional and national levels, the monopoly concentration of tech giants is even higher. For instance, 90% of the search market in Europe, Brazil, and India is occupied by Google; in the UK, 90% of consumers use Amazon for online shopping.
The wide application of digital technology has also greatly promoted the "cloudification" of every link in social production and daily life. Algorithms and cloud storage technologies have not only data-fied the planning, booking, communication, and transaction processes of traditional industries such as retail, transportation, catering, education, housing, and healthcare, but have also profoundly transformed the operating models and business processes of these industries. By controlling cloud infrastructure and algorithms, tech giants have directly or indirectly seized the initiative in these fields and are actively laying out future industries, attempting to build cloud space into a comprehensive platform capable of accommodating all kinds of industries and services. Tech giants appear to play the role of supreme "sovereigns" or "lords," exerting influence over all walks of life. However, control is also the internal logic of the capitalist mode of production—from controlling labor power to controlling industrial chains—without needing to resort to feudal categories. Tech giants follow the logic of monopoly capital expansion aimed at profit maximization. They utilize venture capital, technological monopoly, and data commodification to pursue the maximization of interests for the enterprise and its shareholders. This is precisely an embodiment of capitalist relations of production, rather than a feudalization of relations of production.
(2) Dominating Physical Territory: The Politicization of Cloud Power
Tech giants are not satisfied with the concentration of cloud power alone. At the economic level, they not only use digital technology to become commercial intermediaries and technical service providers for traditional industries, but also intervene deeply in the development of physical industries through investment, mergers, and acquisitions. Therefore, many tech giants have transcended the identity of mere digital enterprises. Taking Amazon as an example, its subsidiaries are extensively involved in media and entertainment, e-commerce, cloud computing, logistics, grocery retail, health care, home services, and equipment services, covering almost every aspect of life. The comprehensive layout of tech giants across cloud and physical industries has further consolidated their monopoly position in economic networks and ensured continuous control over industrial chains.
More importantly, tech giants also seek to enter the political sphere, attempting to directly intervene in national politics and policy to serve their own visions and intentions. On one hand, they proactively respond to scrutiny from regulatory agencies and antitrust litigation. To this end, the strategies of tech companies are quite explicit: hiring large numbers of lawyers and lobbyists to circumvent or even eliminate policies unfavorable to them. In the first nine months of 2024, Meta's lobbying expenditures reached a record $18.9 million, a 29% increase over the same period in 2023. Meanwhile, Meta employed 65 lobbyists, equivalent to one lobbyist with interest ties to Meta for every eight members of Congress. In Europe, according to data released by the NGOs Corporate Europe Observatory and LobbyControl, as the intensity of EU digital policy regulation has increased, tech company lobbying costs have risen to €113 million per year; the total lobbying expenditure of the top ten digital companies alone accounts for more than one-third of all lobbying spending. On the other hand, tech giants use personal connections to directly intervene in and influence politics. Their habitual method is through the "revolving door"—the movement of employees between public sector positions and private sector positions—recruiting former regulators or dispatching employees into government departments to serve in official capacities. One study found that 18% of total appointees in the U.S. Department of Commerce are registered lobbyists, most of whom are core employees from major tech companies. A similar trend is visible in Europe, where Big Tech companies hire former politicians, civil servants, and political consultants as corporate political strategists. The most striking phenomenon in recent years is "cloud capitalists" entering the political arena in person to take over political affairs. In 2024, Elon Musk, as the world's preeminent wealthy businessman, controls multiple technical companies including Tesla and SpaceX. He not only spent at least $270 million to support Trump's presidential campaign but also leveraged his acquisition of the social media platform X (formerly Twitter) to participate in commenting on and denouncing various political events, while launching technical sanctions and litigation against various dissenting opinions. After Trump was elected President of the United States, Musk was also appointed to assist the new administration in leading the formation of the "Department of Government Efficiency," aimed at shrinking the size of the federal government. From this, it is evident that in global political affairs, the role of tech giants is not only increasingly active, becoming a role that cannot be ignored, but is also a key force influencing decision-making and public opinion.
(III) Digital Tech Giants are Becoming the Hub of Global Monopoly Capitalism
Undoubtedly, along with the deep integration of digital technology and capitalist relations of production, tech giants have already become the core of the global capitalist accumulation regime. On one hand, tech giants maintain the basic architecture of the global capitalist division of labor. Wage labor remains the subject that produces surplus value, and the "center-periphery" system of capitalism has not undergone a fundamental transformation. On the other hand, global production and distribution power are concentrating toward tech giants. Tech giants possessing core digital technologies not only far exceed traditional industrial giants in fields such as energy, industry, and transportation in terms of market share and profitability, but also demonstrate stronger capabilities in controlling supply chains. Not only that, tech giants are rapidly expanding their business in the field of financial services, using massive user databases, digital capabilities, and innovative investment and financing business models to form a competitive posture against banks. When analyzing imperialism, Lenin once pointed out: "The rest of the world is more or less the debtor to and tributary of these four countries, these four international bankers, these four 'pillars' of world finance capital." Theorists of technofeudalism similarly recognize this point; they argue that tech giants are beginning to become "pillars" in the economic network, with the whole of society forming a brand-new pyramid structure and chain of returns. At the very top are the "cloud capitalists" acting as the "creditors" [6] of the digital era, followed respectively by industrial capitalists who rely on cloud technology and exploited laborers.
The monopoly power of digital tech giants also shows signs of reshaping state structures. Under the discourse of efficiency and refinement, "cloudification of the state" has become a choice for government governance. Governments sign collaborative contracts with tech companies, requiring enterprises to provide technical "solutions" for social governance and promoting the cloudification of public services. However, this process is also a process of transforming public power into a commodity, where large amounts of capital are transferred to tech companies as private profit; the massive amounts of data generated during the digitization of public services are also acquired by tech giants cheaply or even for free. While digital technology enhances governance efficacy, it is also diminishing government responsibility, as if public life only needs to be adjusted into data and algorithms to be regulated and properly handled with the aid of technology. Some scholars have pointed out that "state cloudification originates from a naked neoliberal logic, namely following a 'cloud responsibility model' [7] to actively delegate the state's responsibility for its data to Big Tech companies. This move is similarly supported by market-oriented discourses that treat different departments of the state as profit-seeking, agile tech companies rather than government agencies responsible for citizen welfare." Furthermore, a tighter "alignment" between state power and digital technology may give rise to a new form of state power—a "Digital Leviathan"—where individual autonomy and rights face a new crisis.
The power of tech giants is capitalist in nature and by no means feudal. The explosive innovation and development of digital technology is causing the entirety of capitalist society to undergo a "revolutionization"; a small number of tech companies control the R&D and application of digital technology, using this to extract more and more profit. But tech giants remain members of the global capitalist market, following the basic logic of capital accumulation, and their pursuit remains the surplus value created by wage labor. As levers for coordinating global production and influencing world society, the power and control mechanisms of tech giants far exceed the scope of "feudal lords." The concentration of capital and power in a few giant enterprises conforms to the basic characteristics of monopoly capitalism. The characteristics and evolutionary paths exhibited by tech giants in terms of monopoly forms, output content, means of oppression, and avenues of plunder are all highly consistent with the logic of capital analyzed by Marx and the characteristics of monopoly dissected by Lenin—we are still in the highest stage of capitalism.
Conclusion
Varoufakis believes that technofeudalism is "fundamentally distinct from capitalism," and thus it "helps us see key aspects of the real world... and also helps us understand a massive power struggle that will likely determine the face of the world in this century." His intention is naturally to hope that with the help of this new category of technofeudalism, he can better explain the world and find a path to liberation that satisfies historical conditions and meets the needs of the era. Precisely because of this, when theorists of technofeudalism like Varoufakis "abandon" Marx’s basic categories and analytical paths, the final result can only be to "head south by driving the chariot north" [8] (work against one's own goals).
First, capitalism is a total set of relations of production; tech giants remain the bricks and mortar constituting the capitalist edifice. Marx once pointed out that the "specific manner and method in which this combination [of laborers and means of production] is effected distinguishes the different economic epochs of the structure of society." Digital tech giants have not overturned the way means of production and laborers are combined, nor have they changed the specific roles played by objective means of production and living labor-power in the production process. Tech giants are not "lying flat" [9] landlords; what they pursue is still the surplus value produced by labor-power employed by capital, and the distribution of surplus value depends on the ownership of the means of production and the struggle between the various classes. Technofeudalism is a static portrayal of digital capitalism; it cannot fully reveal the internal logic and contradictions of the capitalist mode of production, nor can it explain the dynamic changes between various classes under the conditions of technical evolution.
Second, tech giants have become rentiers at the top of the social pyramid, but their fundamental interests are consistent with those of other capitalists. Tech giants rose during the process of capital constructing the digital realm to realize capital valorization and accumulation; they are the result of capital concentration and technical monopoly caused by the forward advancement of the capitalist mode of production. The bourgeoisie has thus further differentiated; digital capitalists have occupied a powerful position in the economic network, and the power to distribute surplus value has been reshuffled within the bourgeoisie, with part of the power of traditional industrial, commercial, and financial capitalists being transferred and concentrated toward digital capitalists. However, the antagonistic relationship between the bourgeoisie and the working class has not changed, nor has the former's control and exploitation of the latter. The technofeudalist perspective fails to sufficiently examine the common interests of the bourgeoisie and their impact on class struggle.
Third, from the perspective of the path to liberation, the "Cloud Rebellion to Overthrow Technofeudalism" proposed by technofeudalist theorists is, to a certain extent, conservative. For example, Varoufakis believes that, constrained by the cloud capital's dominance over the world, merely uniting the proletariat is insufficient; one must unite the "traditional proletariat and cloud proles, plus cloud serfs, and at least some of the vassal capitalists." At the same time, he points out that due to the physical isolation of cloud serfs and cloud proles, it is not only necessary to conduct cloud-based mobilization but also to use cloud systems and technology to carry out actions. Undoubtedly, Varoufakis attempts to provide a set of actionable plans for proletarian resistance in the digital era; however, these conceptions possess defects. On one hand, Varoufakis’s imagined coalition is essentially a kind of bourgeois revolution of the digital era, falling short of human liberation in the Marxist sense; on the other hand, Varoufakis is overly optimistic about the effects that cloud mobilization might produce and lacks a sufficient estimation of the potential obstacles and the massive sacrifices that would need to be made.
In general, as a theoretical attempt, technofeudalism reveals the core traits and real-world contradictions of tech giants in the digital era at the phenomenal level. However, applying the concept of "feudal" to the development process of capitalism neither conforms to theoretical logic nor accords with historical facts; it is a form of transhistorical philosophy. The misreading of capital and labor and the misjudgment of profit and markets by technofeudalist theorists stems fundamentally from their failure to understand the developmental nature of capitalism. Of course, we cannot deny the intellectual originalities of technofeudalist theory; its theoretical limitations also remind us that we should not use form to obscure essence. Therefore, we must adhere to the Marxist thread of analysis, examine the connections and contradictions between digital tech giants, digital labor, and digital capital, clarify how digital technology creates conditions for the global connection of laborers, and explore corresponding struggle strategies centered on the dynamics and weaknesses of digital capitalism, thereby finding the exit toward a new society.
(Author's Affiliation: School of Marxism, Tsinghua University) Online Editor: Zhang Jian Source: World Socialism Studies, No. 3, 2025