By Mike Bebernes | Editor, Yahoo News 360
ON THE WEB, 7 June 2019
What’s happening: A handful of tech companies that started out as tiny startups have grown into some of the biggest corporations in the world. But have the likes of Facebook, Google, Apple and Amazon gotten too big?
This is a question being explored by government agencies in both the United States and Europe. At the heart of each inquiry is the question of whether big tech has become so dominant that companies can behave in ways that hurt consumers. If the ultimate answer ends up being “yes,” a potential solution is to break up these companies into smaller parts.
Why there’s debate: The core argument for breaking up big tech is the same that has been used to address past monopolies in industries like railroads, oil and telecommunications. Advocates argue that a small number of firms wield outsize power in an increasingly important industry. In this environment, the companies are then free to drive up prices, favor their own products, buy out or copy any emerging competition and violate users’ trust.
Plans to break up big tech, like the one from Sen. Elizabeth Warren, D-Mass, propose splitting the tech giants, essentially undoing the acquisitions they’ve made in recent years — for example, Facebook, Instagram and WhatsApp would become separate companies again. The idea has garnered the support of legislators like Rep. Alexandria Ocasio-Cortez, D-NY, and even people within the industry, such as Facebook co-founder Chris Hughes
Sceptics of the idea point to the slew of advances big tech companies have made that benefit everyday Americans: things like Google’s supply of useful apps or the low prices Amazon provides to online shoppers. Although there is growing consensus on both sides of the political spectrum that tech firms have become too powerful, many believe regulation to be a more realistic and effective alternative to a mass tech breakup.
What’s next: European countries have been more aggressive than the United States in curbing the dominance of big tech. They’ve handed out billions of dollars in fines and pressed companies to tamp down misinformation on their platforms.
In the United States, the inquiries are just getting started. Any process to break up big tech companies would likely take years and lead to drawn-out legal battles.
Big tech should be broken up
“Monopolies aren’t good for anyone except for the monopolists. In this new Gilded Age, we need to respond as forcefully as we did the first time around.” — Robert Reich, Guardian
Splitting up big tech would be bad for everyone involved
“Here’s the thing: if the government decides to launch real antitrust cases against the tech industry, it’s hard to see how there are any winners.” — Jason Aten, Inc.
Despite their missteps, the big tech companies are an overall good
“It’s important to remember that, for all their faults, these companies shouldn’t be vilified. After all, they’re pillars of the American economy. They collectively employ almost 900,000 people. They’ve made it easier than ever to start a business. They’ve invented entirely new categories of products and services — and often charge users nothing for them.” — Editorial, Bloomberg
A conversation about splitting up big tech is good, even if it comes up short
“These investigations are well past due. And while we may be dubious of their efficacy — breaking up a trillion-dollar conglomerate is no small matter — that is no reason not to press forward.” — Jacob Silverman, Washington Post
Breaking up big tech would be too aggressive and less effective than regulation
“Breaking up companies takes forever and is a drastic way to do what could have been done via actual laws now in place or intelligent changes in antitrust laws.” — Kara Swisher, New York Times
The tech industry is far too complex to compare to historical antitrust successes
“Busting up the nation’s tech giants would be much harder than making a campaign pledge. Corporate breakups are a huge, and rare, undertaking for the government, and a social media company like Facebook presents unique challenges that didn’t exist with past antitrust successes.” — Margaret Harding McGill and Steven Overly, Politico