The United States Department of Justice (DOJ) just filed an antitrust suit against Alphabet/Google, mainly for what they see as anti-competitive practices that harm competition related to their search engine.
But this topic has become increasingly hot around Amazon and Facebook too. Do you feel that they do behave in unfair practices that stifle your ability to find or do what you want elsewhere?
I personally dislike the winner-take-all tropism that is endemic to networked computing. But does this come about because of monopolistic practices? I’m not so sure.
Here is an interesting section of a newsletter by well regarded VC Benedict Evans:
At the beginning of this year I wrote an essay called ‘How to Lose a Monopoly’, in which I pointed out that when Microsoft replaced IBM as the centre of the tech industry, IBM didn’t disappear, and neither did mainframes. In fact, IBM’s mainframe business carried on growing - its installed base (measured in MIPS) went up 10x from 2000 to 2010. Mainframes and IBM are still there - they just don’t matter anymore. The same happened to Microsoft 15 years later. Microsoft dominated PC operating systems, and that gave it dominance of the broader tech industry, but then PCs stopped being the centre of tech and with it Microsoft, like IBM, became just another big tech company. It’s still a big company, but no-one is afraid of it anymore, and it’s 20 years since anyone started a company to write Windows software. It didn’t lose its monopoly - rather, the monopoly became unimportant.
Today, Amazon has won (for now) a certain kind of logistics-based ecommerce, but that’s not the only kind of ecommerce, as Shopify or Net a Porter show. Google won a certain kind of information management, but was utterly unable to have any impact on a new startup called Facebook. Facebook ‘won’ social and Youtube ‘won’ UGC video, and yet neither have yet laid a finger on Tiktok. The competitive challenges to big tech companies do not come from someone new doing the same thing - they come from something different. Your castle may be impregnable, but the river changes course, the harbour silts up or the trade routes move. Someone works out that if you can sail around the Cape of Good Hope you can go direct to the source and ship spices to Europe at a tenth of the price the Venetians are paying in Egypt and Syria. Meanwhile, sometimes someone does storm the castle: Zoom came to what most people thought was a mature, entrenched business (I might well have told them they were out of their minds) and yet it broke in with a meticulous focus on user experience.
The following is a great newsletter rant about tech monopolies from Cory Doctorow (mailto:plura-list@pluralistic.net).
Many of you here discussing issues, finding collaborators to me are part of a direct line of tech people who are very much not doing what is becoming more dominant, and a sometimes tacit theme of the tech giants, “Techies who fell in love with the experience of technological agency now
spend every hour God sends taking it away from others.”
"From Today, The Daily Beast published “The Justice Department
Finally,Finally! Takes on Google and the Danger of Monopolies,” my op-ed
on tech antitrust and its connection to the digital rights movement.
I’m in my 19th year as a digital rights activist, and while there’s a
vogue of accusing the movement of being blind to the possibilities of
techo-dystopia, that’s a revisionist history. You don’t devote your life
to the cause if you think it’s automatically going to be great.
But there was a blind-spot: the assumption that antitrust action would
maintain the dynamism, opportunity and variety of the early commercial
internet, keeping it from devolving into five giant websites filled with
screenshots of text from the other four.
https://twitter.com/tveastman/status/1069674780826071040
There was good reason for that assumption, of course. If you got online
in the 1980s, then your modem connected to phone lines operated by
post-AT&T-breakup; “Baby Bells.”
The reason your PC ran DOS is that IBM was so traumatized by a 12-year
antitrust investigation that it allowed Microsoft to make its OS, rather
than risking more enforcement through vertical integration.
And the PC clones from dozens of new upstarts were only possible because
IBM didn’t pursue the then-tiny company Phoenix for cloning its ROMs,
again, out of fear of a rerun of its antitrust trauma.
When Microsoft came to dominate 95% of the desktop, the DoJ stepped in
again to punish it, and if they failed in their breakup bid, at least
they cowed the Beast of Redmond so that it stopped killing startups the
way it had with Netscape, allowing Google to rise.
What we didn’t understand was that Ronald Reagan had gutshot US
antitrust enforcement and these were its last gasps, as it bled out over
two decades.
We didn’t understand how thoroughly Reagan’s court sorcerer, Robert
Bork, had transformed the consensus on monopolies.
We didn’t understand that every president that came after Reagan, right
up to today, would continue to encourage monopolization under cover of
the doctrine of Robert Bork, creating a world where every industry has
collapsed into oligarchy.
Five publishers
Four studios
Three labels
Two brewers
One eyewear company
and falling.
Which is why the federal Google antitrust action is exciting - not
merely because the complaint threads the impossible narrow eye of Robert
Bork’s needle for anti-monopoly enforcement; but because it made so many
people recognize that getting Google for search dominance is like
getting Capone on tax-evasion. The pretense that monopolies are good,
actually, is wearing so thin that even its beneficiaries are doubting it.
One area that interests me with my digital-rights-activist hat on is how
monopoly changed the fortunes of tech workers. Back when there was
competition in the industry, tech workers had a stake in unfettered tech
industry growth.
But monopolization created the investors’ “kill zone”: the areas
adjacent to Big Tech’s walled gardens that no one will invest in,
recognizing that Big Tech can simply obliterate any competitor in these
areas.
That leaves Big Tech to enjoy double-digit year-on-year growth without
having to endure what Peter Thiel calls “inefficient” competition. It
also means that tech workers don’t realistically dream of doing to
Google what Google did to Yahoo.
The best they can hope for is to do a fake “startup” that’s actually
aimed at “acqui-hire” - an acquisition for the sole purpose of hiring a
team that has proven it can field a product. The startup’s product is
flushed, and the VCs get a commission in the form of a buyout.
Instead of building an empire or “making a dent in the universe,” tech
workers are promised a well-funded retirement, mini-kitchen kombucha on
tap, and free massages on Wednesdays.
The path into the tech industry generally starts with the heady rush of
empowerment that comes from writing code and using networks to share it,
and to find communities of likeminded people. The rush of
self-determination and agency.
But monopolists thrive by moving risk off their balance sheets and onto
those of their suppliers, users and customers - by confiscating and
hoarding agency and self-determination.
Techies who fell in love with the experience of technological agency now
spend every hour God sends taking it away from others. I think that this
Tech Solidarity, Tech Won’t Build It, No Tech For ICE, the googler
walkout, etc - techies are confronting their role in technological
dystopia, and they are flexing their muscle. It’s a gorgeous thing to
behold."