What? Me Worry?
There is much discussion on how change is accelerating and how dangerous the big tech companies have gotten. I do not believe big is terrible by itself. Neither do I think that big means impervious to change or disruption. So while I’m not particularly worried, I also believe we would do well to restructure a couple of these behemoths.
Consumers frequently benefit from the economies of scale large corporations gain. In some cases, the gains in pricing, innovation, and delivery may far outway any perceived negatives from a corporation growing large. Properly governed
large companies can be a win for everyone.
There are many lessons from the pandemic experience. One is that those who did not adapt to the new environment did not survive. Some tried but could not adapt (the retail and hospitality industries come to mind) and did not survive. It is easy to see that forcing people to work from home, avoid crowds, and close restaurants caused a significant acceleration of online meetings and shopping.
Some of these changes will be temporary, many are here to stay, and some will settle out as a mix of the old and new. For many companies, working from home will likely fall into the “mix” category, with people requesting more workdays at home and being in the office several days each week.
I believe that the pandemic has changed both the marketplace for products and services and the political climate. Big Tech (Amazon, Apple, Facebook, Google, Microsoft) will face strong headwinds in competition from each other and enterprising startups, as well as a political climate that leans towards breaking up or weakening their monopolies.
Companies branch out into businesses far off course from their original intended product or service in the quest for continuous growth. Why should Google also own YouTube? Why should Facebook own Instagram? For each of the large firms, we can make a case for and against their expansion.
I would like to see government requirements that a company state a relatively narrow charter for their company and stick to that business only. To pick on Google, if they say that they will be a search firm to organize information on the internet, funded by advertising, they should stick to that. If they deviate, the worst-case remedy might be that they lose their charter (or articles of incorporation). The best case might be that they cannot make the acquisition. If they see an excellent opportunity to purchase another search firm, an evaluation of the impact on the consumer must be made. If they want to buy YouTube, the answer is no. YouTube isn’t a search firm; they are a content aggregator.
I understand that my statements greatly oversimplify reality. I maintain that despite that, the intention to keep businesses focused on their core competencies rather than allowing conglomerates to form makes far more sense than the wild, wild west we have now. As a consumer, I would feel much safer if Google became the predominant (and they are) search firm but had nothing to do with my email or office suite software. Google would be much smaller, and that’s fine. Big isn’t the goal.
I would intend to force the creation of many niche firms rather than allow conglomerates. I believe that will lead to better management and more opportunities for innovation, competition, and employment.