Should I Worry About BIG TECH's influence?

You’ve probably heard of them…. Facebook, Amazon, Apple, Google… maybe even Microsoft, Twitter or Netflix. There is hardly an hour in our days when these names are not read, heard, or referenced in-directly. The Big Tech oligarchy of publicly traded private companies, controls our communication, news, entertainment, product consumption, and world-wide ideation. FAANG (Facebook, Apple, Amazon, Netflix and Google) or FAMAGs (Facebook, Amazon, Microsoft, Apple and Alphabet [Google’s parent company]) undeniably define our times. But are we truly in an era where the influence of such a tiny group of leaders can be compared to Orwell’s Big Brother - watching and controlling our every move? Should we worry about this oligopoly or relax knowing our lives are more comfortable because of them? 

Let’s start with a quick review of statistics. It’s remarkable how much four, or at most seven, CEOs control our economics, culture, and livelihood. In 2015, FAMAGs made up 8% of the shares in the S&P 500. In 2020, they accounted for 20% of the index in terms of market capitalization. According to The Economist, in 2020 alone, the market value of the five biggest tech companies rose by 46%. Amazon controls one third of cloud business, 44% of Ecommerce and 70% of the smart-speaker market. Google controls 90%+ of the search market. Facebook controls civil wars and government elections. The Big Four (Facebook, Apple, Amazon, and Google) have a combined market value of $5.5 Trillion. These figures reflect unquestionable wealth and power. To relate; can you imagine if 90% of our news came from one newspaper? And the newspaper publicly argued that it doesn’t have a monopoly? That source of information has a large pair, to say the least.

Largest Companies In the World 2020

Big Tech’s power and influence infiltrate even more. Appointments to the Department of Defense, State Department, Office of Management, Commerce Department, etcetera or other “above lobbying” placements in government or humongous contracts with federal agencies are the norm for this elite pack. If you take a look at Biden’s team, a lot have critical connections to FAANG. Jessica Hertz, Austin Lin, Erskine Bowles, Jeff Zients, Antony Blinken, and Jay Carney to name a few. Apart from government, these companies control an unbelievable amount in our lives. Last April, The Wall Street Journal reported Amazon employees “used independent seller data to guide the development of Amazon’s own products.” So not only is this single platform distributing 40% of Ecommerce products, they are also copying their supplier partners. And we all have learned first-hand how data-driven prioritization online can lead to mis-information, extremist groups, even a coup d’etat. I personally have written about the psychological effects when online prioritization is too filtered. Ultimately, our information is so regulated we have to question the loss of free will. Media and even individual vloggers and bloggers filter their messaging “not to disturb” the powers-that-be/owners of their platform-of-choice. Jayapal explained to The Verge, “The patterns of behavior are to dominate and to use that dominance to set the rules, so that other competitors cannot succeed.” In short, Big Tech is infiltrating our government, our commerce, and our psyches. The goal is to not just control their niche-of-business, but to control the market so others' cannot thrive.

That leads us to the government’s actions towards breaking up Big Tech. Interestingly enough, Republicans and Democrats agree these companies are monopolies. Dan Wang, who teaches technology strategy at Columbia University mentioned to MarketWatch, “(The government parties) have different reasons, but have reached the same conclusion. There ought to be some sort of government action.” The US House of Representatives antitrust subcommittee summarized the Big Four (Facebook, Apple, Amazon, Google), “' ‘have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons.’ The subcommittee specifically called out Amazon’s dominance in e-commerce, Google’s in search and advertising, Facebook’s in social networking, and Apple’s in both mobile content and apps.” And though their stocks didn’t hurt last year, the public Senate defense of Mark Zukerberg and Jack Dorsey was embarrassing to watch. The senior government bureaucrats seemed to barely comprehend the sentences they asked each tech titan. While these young men of Facebook and Twitter calmly answered the questions, knowing they and their Silicon Valley teams are strategically years ahead financially and legally from being prosecuted. 

Mark Zuckerburg

The reality is Big Tech knows the public is now suspicious of their monstrous influence. But that certainly doesn’t mean the end to them. Matthew Cowan, a venture-capital partner at Next47 in Silicon Valley hypothesized, “I look at it as a mixed bag to a net positive. There will be a chilling effect on any large acquisition by (Big Tech). On the flip side, it will prompt companies like Google to be more careful in their business practices, and spur innovation among startups.” That means less acquisitions of growing mid-sized companies, and more IPOs. Which hypothetically means more competition. Another strategy to divert government regulation is the acquire outside their standard industry. Amazon has led the way in pivoting their acquisitions to brick-and-mortar. The purchase of Whole Foods as well as influx of their own convenience stores are a couple of examples of off-setting their Ecommerce dominance and seemingly “diluting” their portfolios. But is this enough? 

Interestingly, it also wouldn’t be shocking if Big Tech self-regulates and break themselves up before the government requires it. Google restructured its businesses into Alphabet five years ago. And now claims it is a diversified entity. This isn’t a bad strategy for the others to follow. The private Big Four can control the outcome that way, and get the public sector off their backs. Still, as read on infoworld, “nothing would be more natural than for the newly independent, split-off divisions to come roaring back with fresh capital, vision, and momentum.” Well said. Either the federal government breaks them up, limits their power, or Big Tech will do it themselves. Either way, it would be seemingly easy for the new smaller divisions, structured and filled with ripe human resources, to be refunded and re-grown, eclipsing smaller businesses once again.


One thing is for sure, in the next decade Big Tech will face greater regulatory scrutiny. Their powers might shift from direct-to-consumer, to through-government intervention. Software startup acquisitions might slow down, but investments in brick-and-mortar or tangible strongholds might become the trend. Should we worry about Big Tech’s influence? Today, there is no question they have a monopoly on power and money. Small business owners, and individuals have very few choices other than to keep purchasing, using, and consuming from these few businesses. However, in the long run, their influence can provoke a unified view with government, single-mission stimulus, which given the right direction, can make great sustainable, equitable, or healthier changes to our world. Their influence could be nothing short of what our planet and world needs today and in the future.

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