How does a Megacorp make money?

[Michael Hopcroft]

One think I've wondered about cyberpunk-style worlds is where the "evil Megacorps" make their money in dystopian conditions. Who is buying their products when everybody either works for them, works for a rival megacorp, or is a penniless non-person under the law? If nobody has any money, how does a megacorp support itself? Where's the profit in going into shooting wars with rivals instead of out-competing them in the marketplace? And if there are few real profits to be made, how does the corporation support its massive structure?

[AirborneRob]

Re: How does a Megacorp make money?

 

One think I've wondered about cyberpunk-style worlds is where the "evil Megacorps" make their money in dystopian conditions. Who is buying their products when everybody either works for them' date=' works for a rival megacorp, or is a penniless non-person under the law? If nobody has any money, how does a megacorp support itself? Where's the profit in going into shooting wars with rivals instead of out-competing them in the marketplace? And if there are few real profits to be made, how does the corporation support its massive structure?[/quote']

 

Im not sure i can see why people working for a Megacorp would/could not buy their products. I guess it depends on what that Corp produces as to whether their employees can afford or want something. I would be really surprised if employees from different Megacorps were not buying from a different Corp. Im not that familiar with the Cyberpunk universe but unless employees are having their homes searched regularly, im sure they buy what they want from whomever they want. Is it possible that they could also be selling to " the small fry", little companies not necessarily on the scale of the Megacorps?

[prestidigitator]

Re: How does a Megacorp make money?

 

Hmm. Well, pretend there are machines to do everything for you. Power is generated, food is grown/synthesized/harvested/whatever, clothes and furniture and buildings are constructed, health is measured regularly and dealt with proactively and automatically, all the entertainment you could possibly want is at your fingertips, and you can travel anywhere you desire since there is such an abundance of energy. Now, what exactly is money good for anymore? Well, fighting over of course! I'm not saying I've painted a picture of a cyberpunk world, exactly, but it's like the more we have--or the more capability we have--the less real everything becomes, and the more we subjugate and terrorize each other just for the heck of it.

 

And that, I think, is where money and mega-corporations come in. Mega-corporations are more a symbol and a living, breathing, political entity than an actual company. Who can claim to control more assets, subjugate more people, manipulate more political leverage, advertise more effective brainwashing? And money, ultimately now having value only because it's really a means of keeping things from people rather than allowing them to earn those things, a symbol of status rather than ability and effort, kept at an arbitrarily measured and held value by artificial means...used as a meter by which the mega-corporations boast their relative power.

 

That's sort of the vision I have of such a world.

[dmjalund]

How does a Megacorp make money?

 

A printing press and ink?

[Markdoc]

Re: How does a Megacorp make money?

 

I don't think I have ever seen a game where there is only one megacorp, so there'll be cross-corporation sales. In addition, in most cases, you have a giant - if oppressed - working class. They might be poorer (relatively) than they are today, but there'll be another 150 million of them in the US by mid century and another 3 billion of them worldwide. They're going to need clothes and food, water and electricity and a place to live - and they'll probably pay a lot more for those last few than they do today. And they might not need - but they will want - shiny gadgets, entertainment, personal upgrades, etc.

 

Think about how things are today with increasingly pervasive personal advertising and increasing disparity of wealth. The poor ol' joe schmoe might not have as much money relatively as he does today, but companies will be increasingly adept at prying it out of them. I've always envisaged the "dystopian cyberpunk future" like this. Take those trends I noted above and lay it over modern metropolises like Bangalore, Bangkok or Lagos. You end up with things like this: Ambani's billion dollar house, where he and his family (and 600 servants) can kick back in luxury and enjoy the view out over Mumbai's slums.

 

The people in those slums might not have much money personally, but they - and people like them - have enough collectively to make corporations like Ambai's very rich indeed.

 

cheers, Mark

[Cancer]

Re: How does a Megacorp make money?

 

The people in those slums might not have much money personally' date=' but they - and people like them - have enough collectively to make corporations like Ambai's very rich indeed.[/quote']

 

... and they're working hard to bring that about.

[Lawnmower Boy]

Re: How does a Megacorp make money?

 

Megacorps make money the old-fashioned way that the execs learned back at Wharton. (Okay, technically, that the folks down at the thesis mill learned, while the execs were testing whether 50s or 100s gave the best results for snorting coke off naked hookers. But, point: someone learned.)

i) Conspiring to have the world overrun by aliens;

ii) Conspiring to have the world overrun by zombies;

iii) Conspiring to have the world overrun by extradimensional demons;

iv) Conspiring to have the world overrun by genocidal robots;

v) Conspiring to have the world overrun by intelligent apes....

Okay, I'm seeing a bit of a pattern here, but, after all, business cases are always easier to justify when you base them on something that's worked in the past. Or failed only because of the intervention of an attractive amnesiac super-killer. I mean, good gosh, how many of those can there be? It's got to work sometime, and then the world will be a post-apocalyptic wasteland roamed by brain-eating zombies, and the profits will come rolling in!

[Kraven Kor]

Re: How does a Megacorp make money?

 

In most Cyberpunk settings, the MegaCorps "run everything." They sell their products and/or services to the government; military, police, hospitals, schools, etc. And then to other MegaCorps. In a dystopian society as pictured in, say, Blade Runner or Neuromancer or Freejack (yes, that's right, I dare to mention Freejack) you have a huge divide between the haves and the have-nots, but you still have people buying stuff. It isn't a far cry from our own world right now - you have 90% of the world's wealth in less than 10% of the world's hands. In some of the settings I've mentioned, you are just shifting that to 99% of the wealth held by 5% of the people. Megacorps got that rich by basically be rich bastards, but they do realize that someone has to buy their stuff, so they would be driven to maintain a working economy, I would think.

[IndianaJoe3]

Re: How does a Megacorp make money?

 

The people in those slums might not have much money personally' date=' but they - and people like them - have enough collectively to make corporations like Ambai's very rich indeed.[/quote']

 

Yeah. If a megacorp is selling one $5 widget every month to 100,000,000 people (~0.1% of the planet's population), that's six billion dollars a year. It adds up.

[Captain Obvious]

Re: How does a Megacorp make money?

 

Probably most of the megacorps are churning out cheap mass-produced crap for the masses, and also some really high-end quality versions of the same stuff for those with the money to spend. Like the reusable plastic plates, forks, etc at Wal-Mart as opposed to the dishes sold at Tiffany's.

[Susano]

Re: How does a Megacorp make money?

 

In Kazei 5 I call them multinationals, which is (IMO) more accurate then "Megacorporation." They make their money the same way companies do today, selling products to the masses. While life is mixed in K5, it's not a case of "no one has any money," it's more a case of "no one has any power." So people can spend money on all sorts of goods and services (a lot of which is meant to entertain you and keep you occupied so you don't have to think.) And while the stuff might be cheap (in quality or cost) it's still far more advanced than stuff we have right now. It's all relative.

[Roy_The_Ruthles]

Re: How does a Megacorp make money?

 

In most cyberpunk settings, corporations make money by being evil. Literally. Basically around the time that cyberware got invented and people started decking the matrix, everyone realized that money as a representation of goods and services was no longer functional in the dark dystopian future.

 

So some very smart economists put together a nobel prize winning paper which instead related money to how many people you oppress and the soul-crushing effiency by which you oppress them. This allows each mega-corporation to continue to generate positive bottom lines, despite the fact that they create goods and services which no one would purchase.

[Cancer]

Re: How does a Megacorp make money?

 

Very simple. You make products which the immense destitute portion of population believes to be essential to their life and/or happiness. These products can, of course, be destructive to them, like addictive drugs and foodstuffs, mind-numbing entertainment, gawdy nothings that rapidly wear out or fall out of fashion. Make these things as cheaply as possible, in vast quantities, and use advertising to drive up the demand for them, as well as other types of compulsion, like psychological dependence, drastic social pressure, and violent suppression of alternatives. Price these products at the threshold of what those people can afford: it must difficult to get them, but within their meagre means, barely. Get billions to buy them. Repeat. Nudge your megacorp rivals by violence and dirty tricks to hemorrhage money into the squatter population from time to time; this is has the double benefit of hurting your rivals while increasing your revenues, assuming you're running your mainstream business right. Use all means possible to suppress negative news about your products and activities, though it's usually best to avoid wholesale liquidation of academics and other independent thinkers; it's easier and more effective in the long run to buy them off.

[Escafarc]

Re: How does a Megacorp make money?

 

Very simple. You make products which the immense destitute portion of population believes to be essential to their life and/or happiness. These products can' date=' of course, be destructive to them, like addictive drugs and foodstuffs, mind-numbing entertainment, gawdy nothings that rapidly wear out or fall out of fashion. Make these things as cheaply as possible, in vast quantities, and use advertising to drive up the demand for them, as well as other types of compulsion, like psychological dependence, drastic social pressure, and violent suppression of alternatives. Price these products at the threshold of what those people can afford: it must difficult to get them, but within their meagre means, barely. Get billions to buy them. Repeat. Nudge your megacorp rivals by violence and dirty tricks to hemorrhage money into the squatter population from time to time; this is has the double benefit of hurting your rivals while increasing your revenues, assuming you're running your mainstream business right. Use all means possible to suppress negative news about your products and activities, though it's usually best to avoid wholesale liquidation of academics and other independent thinkers; it's easier and more effective in the long run to buy them off.[/quote']

Sounds like a Apple/Lucas merger

[Peregrine]

Re: How does a Megacorp make money?

 

Sounds like a Apple/Lucas merger

 

I honestly can't decide which half of that is redundant...

[Starcloud]

Re: How does a Megacorp make money?

 

What you see in the various dystopian Cyberpunk novels are the disaffected, the disenfranchised, the exceptions.

Susano's approach is far more realistic than assuming everything is like Shadowrun/Cyberpunk 2020/William Gibson's Neuromancer and related works. There are plenty of people who don't work for multinational megacorporations; they work for smaller firms or for local and national governments, or are even entrepreneurs who own their own small businesses. The number of people who are "outside the system" are actually far far smaller a percentage of the population than you might assume from various books, and again the majority of people lead relatively normal lives and aren't really touched by the abuses of the megacorps except in a very distant sort of way.

I've noticed that no one ever writes about McDonalds as a megacorp, even though it is... because Food Service is too mundane an industry to write about.

[Ranxerox]

Re: How does a Megacorp make money?

 

I've read a fair amount of cyperpunk, but I can't recall any megacorps that were presented as being quite as all-powerful as you are describing. I must have been reading the wrong cyperpunk books.

 

However, even if a corporation was a mega as the megacorp you are describing it could work economically. Even though megacorp is paying it's workers peanuts as long as those workers are desperate enough to work for those wages they would still be adding value to the system. In this set-up the megacorp is the de facto government and all the wages that they short changing their employees become in effect a tax. The heads of the megacorp are analogous to the landed nobility in a feudal system with the workers taking the role of peasants. If a duke wants a new castle all he has to do is get his peasants to build him one and so it would be the head of megacorp.

[Susano]

Re: How does a Megacorp make money?

 

I think a lot of this comes from the Shadowrun model, in which the megacorps are that powerful. I also recall it being pointed out that Shadowrun's economy isn't stable and should collapse in short order.

[Cancer]

Re: How does a Megacorp make money?

 

How short is "short order"? One of Shadowrun's core themes is that the world is descending inevitably into barbarism as part of a cosmic cycle that is beyond the ability of anyone to affect, with the more or less complete destruction of civilization and its trappings of technology and order. In that context, I see the megacorps as a clear example of that descent, when power and wealth get overconcentrated and the instability of those at the peaks of those power structures bring about global ruin out of short-sighted greed.

[Susano]

Re: How does a Megacorp make money?

 

How short is "short order"? One of Shadowrun's core themes is that the world is descending inevitably into barbarism as part of a cosmic cycle that is beyond the ability of anyone to affect' date=' with the more or less complete destruction of civilization and its trappings of technology and order. In that context, I see the megacorps as a clear example of that descent, when power and wealth get overconcentrated and the instability of those at the peaks of those power structures bring about global ruin out of short-sighted greed.[/quote']

 

Ah, if that's the case, then it makes more sense. That said, I recall someone point out that in Shadowrun, the megacoprs would last for maybe a few decades at best before collapsing under their own weight, self-interest, and lack of foresight.

[Clonus]

Re: How does a Megacorp make money?

 

One think I've wondered about cyberpunk-style worlds is where the "evil Megacorps" make their money in dystopian conditions. Who is buying their products when everybody either works for them' date=' works for a rival megacorp, or is a penniless non-person under the law? [/quote']

 

Tosh. They aren't really penniless. They're just poor. Slum dwellers still buy stuff. I mean you could go to India right now and if you pasted some random bits of metal on people you'd have a cyberpunk "dystopia". And there are still a lot of people working for your megacorp and others who will be buying stuff.

 

 

If nobody has any money, how does a megacorp support itself? Where's the profit in going into shooting wars with rivals instead of out-competing them in the marketplace? And if there are few real profits to be made, how does the corporation support its massive structure?[

 

Outright warfare between megacorps is not a big feature of cyberpunk. When it happens it'll be small scale and mostly through proxies.

[megaplayboy]

Re: How does a Megacorp make money?

 

Well, huge inequities of wealth tend to be unsustainable long term--the proles revolt, the bubble-based economy collapses, nobody can afford to buy stuff so even some of the "rich-ies" plummet back earthward, etc. Giant entrenched corps with nobody telling them no will tend to have their bad decisions accumulate and snowball on them. The "heroes" in a cyberpunk setting may, in fact, be accelerating that process. Ultimately there is some kind of sweeping reform which brings corps back in check, relevels the rich with everyone else, and begins the first step towards global unification---if we're following a timeline anything like the official Hero Universe timeline, anyway.

[Peregrine]

Re: How does a Megacorp make money?

 

Outright warfare between megacorps is not a big feature of cyberpunk. When it happens it'll be small scale and mostly through proxies.

 

Cyberpunk 2020 presented this exact scenario in their Fourth Corporate War sourcebooks. A Corporate War between the two biggest megas on the planet caused the (near?) total collapse of the global economy. Not coincidentally, this was the planned end of the CP2020 product line.

[The_Patriot]

Re: How does a Megacorp make money?

 

How I handled megacorps within Inceptum Terminus is by giving them clearly designated product lines, political power, and geographical control. The federal, state, and local governments collapsed before or shortly after Armageddon leaving only the corporations behind. The corporations fought a series of wars to consolidate power and land in order to allow humanity to come back from the brink of extinction. After the corporate wars, an uneasy period of peace ensued with small scale conflict being the norm. With the consolidation of political power and land, the Corporate States of America were born.

 

The biggest treaty that was ratified between the nine Corporate States was the Corporate States Economic Trade and Assistance Treaty which establishes a status quo with the introduction of natural monopolies, free trade, and a universal monetary system. Corporate States that infringe upon another Corporate State's monopoly is met with harsh reprisals, including the destruction of the labs/plants where the infringement took place. The new monetary system is based upon precious metals of gold, silver, and platinum because of the collapse of the US Dollar as a fiat currency.

 

Another aspect of the CSETAT is the strictest regulation on the movement of people. Everyone is implanted with RFID chips with a network of radio towers tracking everyone's movement. The greatest natural resource a country has is its citizens and by regulating their movement the Corporate State can prohibit mass migrations to more freer Corporate States. The virtual reality cyberspace networks are linked together by a central hub, but passage from one Corporate State to another is also strictly controlled. Another method of control the Corporate States employ is education and guard it fiercely. Through indoctrination the Corporate States can maintain a strict grip over their people.

 

The natural monopolies enabled capitalism to survive in the macro-economic sense, but inside each of the Corporate States there are competing market philosophies ranging from fascism to laizze-faire capitalism to communism. Each of the market philosophies has gaps between the haves and the have nots.

[Escafarc]

Re: How does a Megacorp make money?

 

I thought the "Corporate Warfare" thing started in Heavy Metal magazine with the Cola Wars?