There are definitely arguments against "everyone an independent contractor", but ending up with a bunch of 1-50 person sized companies instead of a much smaller number of 50k person companies seems very likely. This is a net win for everyone in that failure happens faster, thus allowing resources to be allocated more efficiently -- it also allows high performing individuals and teams to be accurately compensated for their success, vs. the strict seniority or internal-politics systems in larger organizations.
There's an argument for internal communications costs vs. external communications costs (Coase's thing) -- if it's more efficient to communicate within a trusted firm vs. between firms, you end up with huge firms. Things like tight-knit social networks outside of the firm (college alumni, things like YC, sites like hn, various ethnic diaspora in history, ...) would create some kind of hybrid, too, where a lot of interconnected small firms would work, so each firm could be smaller than otherwise. This would actually be interesting research for someone in economics or sociology -- I'd look at formal networks like YC and informal networks like casual coworking and web forums.)
Yes, I think it's an absolutely fascinating subject, and while I have some instincts, who knows which way it could go.
To have some predictive value, what other industries besides web companies that are super cheap and easy to start, might morph towards this kind of structure? Or, here's another one: this industry has long been dominated by giants: IBM, Microsoft, Google, and so on. Will we see the end of that?
(And just to be clear, I think what pg has done is fantastic, and he/them are quite praiseworthy, etc... I'm just pushing back a bit on the idea. I can't foresee doing business with PG or YC, so I have no interest in not calling it like I see it)
I think being a big companies allows you to have a better access to authorities and actual IP laws prevent any meaningful competition to emerge. Our current system provides huge incentive to be a megacorp.
There's an argument for internal communications costs vs. external communications costs (Coase's thing) -- if it's more efficient to communicate within a trusted firm vs. between firms, you end up with huge firms. Things like tight-knit social networks outside of the firm (college alumni, things like YC, sites like hn, various ethnic diaspora in history, ...) would create some kind of hybrid, too, where a lot of interconnected small firms would work, so each firm could be smaller than otherwise. This would actually be interesting research for someone in economics or sociology -- I'd look at formal networks like YC and informal networks like casual coworking and web forums.)