What do we mean by a hyper-commodity world? Commodity circuits operating at continuously higher velocities. We've adopted the term to designate higher and higher levels of market integration where commodities are subdivided over and over again, circulate more quickly and with (supposedly) less friction, and hence -- supposedly -- with higher margins.
Simply turning a use-value into an exchange value is only the entry level to commodification. There have, over the course of the last century, been various modifications and enhancements of the basic commodity model as markets have matured. In the contemporary period, the term "commodity" is now understood as referring only to those items where there is complete fungibility, where there are few, if any, differentiating factors whatsoever. Branding is an effort at countering the devolution of a so-called proprietary good into a "commodity." In this parlance, Intel's latest Pentium chip is a proprietary chip that we might want because Intel makes it, while DRAM chips are a commodity -- it doesn't matter who makes it, we simply want the cheapest one available.
Particularly with goods or utilities that once seemed bound to locale or region, greater rationalization of markets has permitted increased fungibility of that good. Today's example comes from a corporate entity named Enron which began in the global energy business, then took up brokering electricity before turning to water. In 1999 Enron proposed a market that trades in internet bandwidth capacity as a commodity. "Why not...make it a commodity like...uh...porkbellies?" After all bandwidth is bandwidth is bandwidth.
"Enron Proposes Trading Of Telecom Capacity"
Friday May 21, 1999 2:57 AM ET
By Simon Hirschfeld
NEW YORK (Reuters) - Enron Communications, the Enron Corp. (NYSE:ENE - news) unit with its own fiber optic network, is working to create a market for trading telecommunications network capacity, the way commodities such as oil or wheat are traded now.
The company believes the explosion in demand for capacity, or "bandwidth,'' creates the need for an efficient, liquid market that would allow companies to close transactions in seconds, rather than weeks or months.
A liquid market for bandwidth would allow carriers to allocate capacity where it is needed and respond to event-driven spikes in demand, according to Enron Communications Chief Executive Joe Hirko.
Use of telecom network space is currently negotiated between companies in multi-year contracts. In a forward commodity market, as proposed by Enron, trades would be conducted quickly and usually anonymously through a broker.
"We are proposing specifically a forward delivery commodity market for bandwidth,'' Thomas Gros, the unit's vice president of bandwidth trading told Reuters. "Over-the-counter swaps or derivatives and futures are also natural developments down the road.
In the so-called information age data and information are transformed into electrons and pulsed as data packets carried on optic beams.
Globalization can be viewed as a function of attempts to unify the world through the structures of markets. The most obvious multinational effort at such unification is the Common Market which has pursued the strategy of nation-states giving up monetary sovereignty in order to gain market clout within world markets. The unification of markets also occurs at the level of hypercommodification. Representative of this is the so-called B-to-B sector, with startup companies such as VerticalOne that "plans to be the company that aggregates highly personal account information (bank accounts, bills, frequent flyer miles, and so forth) into one service, which is then resold to branded sites, be they commerce sites (like brokerages) or content plays (like Intuit.com). VerticalOne's partners will use the service to increase the utility and stickiness of their sites." (Red Herring, May 27, 1999). This company seeks to make a market in what is properly a Metacommodity -- a commodity formed by, or about, other commodities. These are redundant commodities which claim to offer greater efficiency of pricing.A corresponding process is also going on. The creation of new commodities, first by means of new internet technologies and technologies of miniaturization, and then by the logic of capital and the commodity form. For example, Enron is pursuing what it considers to be the logic of the commodity form by turning the phenomena of bandwidth into a new "market for trading telecommunications network capacity, the way commodities such as oil or wheat are traded now." Enron pursues a more "efficient, liquid market for bandwidth" because it will enable companies "to close transactions in seconds, rather than weeks or months." Not surprisingly, it takes fairly massive units of capital to compete efficiently in this arena. Enron has a 1999 market capitalization of $28 billion.
Accompanying the greater concentrations of capital and the organization of hypermarkets linked together by telecommunications networks, is the stress on greater SPEED.
As more and more commodities wend their way through this world system, the rationalized exchanges described above also wend their way into the micro worlds of electrons and genes discovered and branded as property. Indeed, the development of hypermarkets organized via global networks is made possible by the miniaturization of technology -- most importantly, the ability to convert, send, store and retrieve information that has been turned into arrays of electrons. But they have also been pushed along by occasional crises in the organization of corporate markets. Industry after industry has seen consolidation during the last two decades. Most of the time this is driven by very refined capitalist logic -- though how this plays out is always an adventure. In the oil industry, players like Shell and Mobil and Texaco and Chevron are driven to merge to find still higher economies of scale to offset tendencies toward deflation in raw commodity prices for crude oil. In biotechnology the driving force of merger is again economy of scale, but also the escalating costs of doing research and development necessary to compete.