U.S. TECH FIRMS TOO DOMINANT?
Policymakers considering breaking up or regulating companies that have too strong a hold on society
WITH a handful of United States technology giants growing more powerful and dominant, debate is intensifying on whether big tech’s growth is healthy or not.
Over the past few years, Apple, Google parent Alphabet, Facebook and Amazon have become among the world’s most valuable companies.
Along with stalwarts like Microsoft and rising stars like Netflix, the tech firms exercise enormous control over what people see and how they live.
Increasingly, policymakers and others have begun to consider breaking up or regulating the biggest technology companies, although imminent action appears unlikely.
While many consumers welcome innovation from the tech sector, critics have complained about the power of “gatekeepers” of information and other content.
Google holds around 90 per cent of the Internet search market in the US and Europe. Facebook and Google scoop up some 60 per cent of digital ad revenues and are eating up 90 per cent of new ad growth in the US.
Google’s Android and Apple’s iOS power the overwhelming majority of mobile devices. Amazon accounts for nearly half of US online sales and is expanding into new sectors.
Barry Lynn, executive director of the Open Markets Institute, said three firms — Google, Facebook and Amazon — “have more power than any previous monopolies we’ve dealt with in the past century”.
“We have to be incredibly concerned about the power of Facebook, Google and Amazon,” said Lynn, who launched his research centre after his team was ousted from the Google-funded New America Foundation.
“They have their hands on the flow of news, the flow of books and they are manipulating that flow in a conscious way to promote their interests.”
Even though the idea of taking on the tech giants appears extreme, the upheaval in US politics over the past year has brought together allies from across the spectrum worried about the concentration of economic power.
The recently formed “New Centre” political alliance that includes leaders from the traditional right and left has placed “challenging big tech” on its agenda.
Bill Galston, a former White House adviser under Bill Clinton and co-founder of New Centre, argued that tech monopolies were hurting wages, entrepreneurship and could distort the political landscape.
“The big tech firms have almost unlimited funds they can throw into lobbying, and they have been ramping this up steeply,” said Galston.
Lou Kerner, partner at the investment firm Flight Ventures, said this monopoly power was more concentrated than any in recent history, and expressed concern it would “strangle innovation” and increase income inequality.
European regulators have taken a more aggressive approach, imposing a hefty fine on Google after concluding the search giant illegally favoured its own shopping services. Former White House strategist Steve Bannon said recently he was leading an effort within the administration to turn Facebook and Google into “public utilities”.
But Federal Trade Commission chief Maureen Ohlhausen, who would lead any US antitrust action, signaled any effort to break up tech firms is remote.