Facebook and the Circulation of Capital: The Rentier Supply Chain of Social Media Marketing

Abstract: Digital space is a novel form of spatial expression which have been core to the business model of some of the largest firms within the 21st century. Mobilizing tools from geographical political economy, Facebook and the core function of its digital space is critically analyzed, along with how value is distributed along the advertising supply chain. Facebook, through its continual expenditure on use-values in its digital space aims to capture its user within its framework of socio-technical services. The production of digital space rests upon the material infrastructure (server hall, cable networks), the ideological production (data, algorithms), and the everyday life of the online user to establish a rentier condition. Enclosing the user as such gives an advantage over competing firms, establishing an ownership over the access to the condition of production of digital space. To analyze these processes in the concrete, a specific online advertising campaign on Facebook by a Swedish firm is examined. The study traces the supply chain of the online advertising campaign through Quentin and Campling’s (2018) Global Inequality Chain analysis. The supply chain originates in surplus value extracted from manufacturing in Slovakia by a Swedish producer in Halmstad. Throughout the campaign, several urban cores in Sweden capture value through unproductive services used to optimize digital advertising but the majority, however, is captured by Facebook and rerouted out of Sweden to Ireland. Value capture within Facebook’s supply chain emphasizes the urban, while both the production of the commodity, and (material) digital space itself (the server hall in Luleå) captures low amounts of value. The corporate entity of Facebook is reliant upon appropriation of external industries surplus value and is consequently a facilitator of the social relations of production those goods originate in. The profit flow of Facebook is an extension of the hierarchical interfirm relationship of value capture between the brand owning individual capital in Halmstad and the productive Slovakian individual capital. The digital economy of Facebook is as such the continued facilitation of the social relations of production already present in external industries, and is not revolutionary in any other way than its effectivization of certain aspects of capital circulation and mobility.