Paranoids and old Marxists will love Digital Capitalism, by Dan Schiller. The book fairly shouts that the Internet economy is a plot by plutocrats, a capitalist cabal! But his argument is so unconvincing that a better title for the book would be, Worriers of the World, Unite!

The author, a Marxist professor of communication at the University of California, San Diego, offers a crude conspiracy theory that doesn’t hold up to the slightest scrutiny. He says Big Business consciously created the Internet economy to extend its power. Which is, of course, backward.

As everyone else knows, start-ups created the digital capitalist system that Schiller describes. Big Business was largely late to the game and is struggling to catch up. Netscape Communications, not Microsoft, created the Internet browser. Yahoo!, not Disney, pioneered the commercial search engine and the concept of the high-traffic “portal.” Amazon.com, not Wal-Mart Stores, showed that consumer e-commerce was a business. The efforts of Netscape, Yahoo, Amazon, and the venture capitalists that backed them were (dare I say it?) revolutionary.

Schiller, unfortunately, can’t tell a venture capitalist from an anarchosyndicalist. He mentions venture capitalists only once—and inaccurately. He says “a handful of firms dominated [venture capitalism], including Montgomery Securities, Robertson Stephens, and Hambrecht & Quist.” Sorry, Dan. Those are investment banks, which are very different animals.

Schiller devotes an inordinate amount of his new book to proving the indisputable: that the Internet economy is capitalist at its core, not the utopian commune envisioned by some of the Internet’s early adherents.

He also spends an entire chapter (there are only four in the book) trying to prove that Big Business imposed advertising on the Internet. As evidence, he points to an interesting speech by Procter & Gamble Chief Executive Officer Edwin Artzt in 1994, in which Artzt called on the ad community to find ways to work with emerging interactive media. Some forward-thinking executives such as Artzt did take a proactive approach, but most large companies had to be dragged kicking and screaming to the Web. Early Internet start-ups had to beg large companies to advertise on their Web sites (and still do). Not the other way around.

Schiller is not much better at describing the origin of ideas driving the Internet. He criticizes the Internet for helping give rise to what he terms a neo-liberal philosophy, or what I’d call a libertarian philosophy. Yet he doesn’t explain how that occurred. Schiller doesn’t talk about the role that Wired magazine played as the early voice of the Internet, even though founding editor Louis Rosetto is a strong libertarian. Nor does Schiller mention the influence of other popular Internet intellectuals, such as George Gilder, John Perry Barlow, and Esther Dyson, all of whom have a libertarian bent. For Schiller, as for other orthodox Marxists, people and ideas play second fiddle to grand historical forces.

The book initially seemed promising because so much of the writing about the Internet has been from the libertarian perspective. Schiller, it seemed, could use rigorous Marxist analysis to offer some interesting thoughts on what he sees as the rise of a new political-economic system. He does provide a couple of ideas. His chapter on the transformation of higher education over the past 30 years describes in chilling detail how liberal-arts programs have been smothered by government- and industry-funded research, computer-based teaching, and vocational education.

But don’t buy this book. If you want to read a sophisticated view of the Internet economy by a neo-Marxist, try the trilogy by Manuel Castells: The Rise of the Network Society, The Power of Identity, and End of Millennium. Castells, a professor of sociology at the University of California, Berkeley, writes like most academics. In other words, the book is often turgid. But if you can wade through it, you’ll encounter some genuinely thoughtful and stimulating ideas.

If you want to read Schiller’s ideas for yourself, just go to www.indelta.com/papers/schiller.htm. There, you’ll find a speech that Schiller gave in October 1995 and that was the basis for Digital Capitalism. The speech will tell you more than enough, and Schiller would have to appreciate how you’ll use the Internet to avoid paying $29.95 to Big Business to buy his book.

Nee was known to spout a few Marxist theories of his own before becoming an equally rabid believer in capitalism, particularly the type practiced in Silicon Valley. He can be reached at eric_nee@fortunemail.com.