Scottish Daily Mail

Threat of the dig­i­tal gi­ants

- Alex Brum­mer CITY ED­I­TOR Infectious Diseases · Health Conditions · Edinburgh · Philip & Cristina Green · Philip Green · Amazon · Google · Zoom Video Communications · Microsoft · Microsoft Teams · Facebook · Netflix · Instagram · Whatsapp · · NASDAQ · Atlantic Ocean · Philippines Department of Justice · Alphabet Inc. · United Kingdom · Wetherspoons · England · Scotland · Northern Ireland · Ireland · Trustee Savings Bank · Spain · Sabadell · Bilbao Vizcaya Argentaria Bank · Slack · Debbie Crosbie

ThERE is ab­so­lutely no ques­tion that amid the com­mer­cial car­nage un­leashed by coro­n­avirus, the big­gest win­ners have been the Sil­i­con Val­ley be­he­moths. The col­lat­eral dam­age on the high Street in­cludes un­der-in­vested chains such as Ar­ca­dia and Ed­in­burgh Woollen Mill, run by off­shore ty­coons Sir Philip Green and Philip Day.

Lock­down, the tiers sys­tem and work­ing from home would have been al­most im­pos­si­ble with­out big-tech. Ama­zon has been there for all our shopping needs, Google for all our informatio­n needs and Zoom and Mi­crosoft Teams for both our busi­ness and so­cial in­ter­ac­tions. Face­book kept us in touch with friends and fam­i­lies and Net­flix en­ter­tained us.

With­out the hid­den hand of their con­tri­bu­tion to eco­nomic ac­tiv­ity, the loss of global out­put and the £393.5bn black hole in the pub­lic fi­nances might be in­fin­itely worse.

There is no escaping the fact that th­ese com­pa­nies are un­fet­tered mo­nop­o­lists set­ting their own terms of trade.

They brook no com­pe­ti­tion and armed with ex­cess prof­its have been al­lowed to buy up po­ten­tial ri­vals with­out any reg­u­la­tory in­ter­ven­tion. Face­book bought In­sta­gram for $1bn (£770m) in 2012 and added mes­sag­ing service What­sApp for a mighty $19bn (£14.6bn) two years later. Mi­crosoft paid $26bn (£20bn) for jobs net­work­ing site Linkedin in 2014. In the lat­est such move, one of the newer pandemic cham­pi­ons Slack – widely used ev­ery­where – is be­ing stalked by Sales­force and Mi­crosoft.

Both are anx­ious to avoid an im­por­tant work­force tool un­der­min­ing their mar­ket dom­i­nance. Sales­force, one of the big­gest cloud op­er­a­tors, has been mop­ping up ri­vals as if there is no to­mor­row. It spent $6.5bn (£5bn) on Mulesoft in 2018 and $17.5bn (£13.5bn) on data vi­su­al­is­ing service Tableau a year ear­lier.

The will­ing­ness of the dig­i­tal gi­ants to splash the bil­lions is one of the fac­tors which has driven Nas­daq and the Dow Jones to ever dizzier heights.

In­stead of al­low­ing a new ar­ray of in­fant tech in­no­va­tors to take their place in the pan­theon, ex­ist­ing play­ers are smoth­er­ing them at birth, de­priv­ing users of choice.

In the last month or so, there have been in­di­ca­tions that com­pe­ti­tion au­thor­i­ties on both sides of the At­lantic have seen enough.

The US Jus­tice De­part­ment has be­gun an anti-trust in­ves­ti­ga­tion into Google-owner Al­pha­bet. At the very least there should be re­stric­tions on Google do­ing mega- deals while the in­quiry is un­der way.

here in the UK, the Gov­ern­ment is putting in place a new tech­nol­ogy reg­u­la­tor to try to check the power of the big­gest online op­er­a­tors. The idea is to de­velop a ‘code of con­duct’ de­signed, among other things, to al­low mar­ket new­com­ers space to breathe.

The fight­back has to start some­where. But one fears that when deal­ing with Mi­crosoft et al, firms with multi-tril­lion val­u­a­tions, this will be a David ver­sus Go­liath chal­lenge with­out an ef­fec­tive sling­shot.

Down the hatch

WhO would want to be land­lord in the pandemic? I was brought up on tales of der­ring- do in pub land in the Sec­ond World War as my ma­ter­nal grand­fa­ther was the land­lord at the Rock Inn in Brighton Kemp­town. The cel­lars served as bomb shel­ters for the nearby con­vent, it was a haven for vet­er­ans of Dunkirk and the snug never stopped serv­ing in spite of the Ger­mans dump­ing sur­plus ord­nance as they headed out over the Chan­nel.

So one can only have huge sym­pa­thy for Wether­spoons founder and chair­man Tim Martin over his charge that the tier sys­tem is sim­ply ‘lock­down by stealth’.

Martin is be­ing forced to close 366 of his pubs in­clud­ing 315 in Eng­land and a fur­ther 51 in Scot­land and North­ern Ire­land as a re­sult of the new re­stric­tions. Su­per­mar­kets and off-li­cences may be rub­bing their hands but it is hard to think that home speakeasie­s will keep to the same so­cial dis­tanc­ing and san­i­ta­tion rules as li­cenced and prop­erly su­per­vised venues. Cheers.

Span­ish prac­tices

BE­ING owned by an over­seas bank is no great shakes as suc­ces­sive chief ex­ec­u­tives of TSB have learned.

Paul Pester fell on his sword af­ter a dis­as­trous IT tran­si­tion im­posed by Span­ish own­ers. In­cum­bent Deb­bie Cros­bie, hav­ing re­built the bank’s rep­u­ta­tion and sys­tems, is caught in the cross­fire of Spain’s bank­ing con­sol­i­da­tion af­ter the on and now off takeover of owner Sabadell by BBVA. It is an­other un­de­served un­cer­tainty in trou­bled times.

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