Right off the bat, I want to make it clear that I’m not shilling for Apple when it comes to arguments against the behavior of the largest Big Tech companies. I always lean toward the preservation of free markets with intelligent and targeted regulation to prevent some of the messes we find ourselves in right now. The very kind of regulation that has been totally absent for over 20 years of rule by both major American political parties (more on this in a moment). However, that belief doesn’t excuse bad corporate behavior and Apple is certainly guilty of some.
I’ve always preferred Apple’s approach and products, so I will admit that I’ve never been as hard on them as I have been on Google, Facebook or Amazon. I am far more critical of those companies for their invasions of privacy and flat-out destruction of competitors, and in Amazon’s case, entire markets. You aren’t going to catch me offering any of them a lot of defense beyond the fact that people need to be more intelligent about just blindly handing either every piece of their data or every purchase they make to companies who waive free services and convenience in front of them.
Regulation is important because the threat of intervention and greater control always has to be there to keep large companies in check. In turn, companies like Apple also have to be willing to keep the interests of their customers in mind along with the bottom line. This helps to stave off the need for greater regulation. I can’t excuse the fact that some of that sense has been lost at Apple during their meteoric rise to the top. As such, I believe that they deserve some of the criticism and ultimately the legal and regulatory scrutiny they have gotten themselves into. Not all of it. We as human beings tend to pile on and go over the top and such things. But they still have things to answer for.
While changes to how the biggest tech companies operate are likely going forward, there are a couple of issues that also need to become part of this conversation that are currently nowhere to be found. There is more accountability needed than just for big tech CEOs and broader change required to alter the course of how Silicon Valley operates than just restraining 4 or 5 companies.
Congress doesn’t deserve a free pass for years of inaction
Not at all. Not even a little. In my opinion, Congress should be under just as much scrutiny and be getting just as much negative press and public blowback for the sate of affairs in Silicon Valley as Apple, Facebook, Google, Amazon and others. The simple fact is, many of the same lawmakers on the House Judiciary Antitrust Subcommittee who were lauded for “taking on the man” earlier this week have been sitting idly by for 5, 10, and up to 20 years while all of this was going on right under their noses. I also wouldn’t be surprised in the least to find out that some committee members on both sides of the isle have been taking money from big tech and enjoying the fruits of their lobbying efforts in the past, as well.
It’s also not as if abuse of market reach and power is a new problem in big tech. We went through the same exercise with Microsoft not that many years ago. It took the government far too long to wake up, and when they did, they decided to over-reach and force a split in the company that was only avoided by 11th hour compromises. Based on the Microsoft that I see today, that would have been a big mistake on the part of the United States government, and one that would have been partially caused by their own previous lack of action.
While I am not claiming that the problems in big tech are solely our government’s fault, they are absolutely a part of the problem. If we are going to demand better from big tech, we need to also demand better from the government that was asleep at the switch while they grew unchecked, as well. As with Microsoft several years ago, this is how anti-trust responses usually work in the United States. The US government also did nothing while massive monopolies grew unchecked over a century ago with Standard Oil and the big railroads. They did it again with Ma Bell. Hell, members of the US government tried to create and insulate a monopoly in overseas air travel before Howard Hughes and TWA. This is standard operating procedure here in the US, but it shouldn’t be. We the People should demand better than that.
Our government is and always has been late to the party and then quick to over-reach at a response when they get there. Should we fully trust part of the problem to be all of the solution to Big Tech regulation? I say absolutely not. They will have to be part of the solution, but they should absolutely and deservedly endure as much scrutiny as the CEOs they are up against while working toward that solution. They deserve no extra credit for sleeping through the game and showing up in the fourth quarter to throw a Hail Mary.
The big exit culture of Silicon Valley is also a big part of the problem
This is another integral part of the problem with Big Tech and Silicon Valley. While so much of the discussion is focused on how Apple, Google, Facebook and Amazon dominate and bully small businesses, so many of these same tech startups are founded with an eye already on the exit door. Many founders and the VCs who give them seed money are looking more for a big payday by selling to a larger company than to actually build a long-standing business.
I am a Libertarian at heart, especially in financial matters, so I have a hard time saying that people should say no to taking a fair offer and cash in on their hard work. It may not be my preferred definition, but this is what a lot of people think of as the American Dream. However, this mentality has run wild in Silicon Valley and is feeding the growth of a few huge players and exacerbating the problem of competition that the market faces.
This is a tough problem to solve in my opinion, because there is no government remedy for a cultural phenomenon like this. It’s unfortunate but true that many more of these companies seem to be looking for that big payoff and either life in the big company after an acqui-hire, the next big challenge, or early retirement than those who are looking to build their own brand and resist the offers to become the next big thing on their own. The better situation for Silicon Valley and the American economy as a whole would be a closer mix of startups looking to build sustainable business models with those looking to move up by cashing out. But how do we get there?
The fact that many more companies are looking to acquisitions as their endgame, rather than building a long-term business, puts a lot more pressure on the small businesses that want to go their own way. There is going to be less investor and VC money available to those who make this plain up front because there is a longer period of time before a potential payoff involved. It’s a non-virtuous circle that incentivizes the status-quo.
The way the startup culture in Silicon Valley has changed over the last 15 years is just making it that much easier for the biggest American tech companies to get bigger. New laws and regulations may start to inhibit this by force, but they won’t change the culture and mindset of startups any time soon. That is a different conversation entirely.
Nothing about holding the US government and regulatory agencies accountable for not acting sooner or recognizing the role the startup culture in Silicon Valley plays in the rapid growth of Big Tech excuses bad corporate behavior. I’m not trying to make that case at all. However, I do think it’s important to take a broader view of this situation. There are more people with responsibility for how Silicon Valley has evolved than just a handful of CEOs. Slapping a few companies on the wrist, or worse yet, arbitrarily breaking them up, isn’t going to fix a damn thing on its own.
It’s going to take more than a few new laws and regulations to avoid ending up right back where we are again in a few years. That will require taking a step back and looking at some of the context surrounding all of this and the deeper issues involved. Our lawmakers and regulators refusal to modernize our laws as technology has changed the world and the culture of Silicon Valley startups that has evolved to serve the interests of a few companies are just two of them. There are certainly many more. If we don’t start to include these things in the conversation about how Big Tech will be governed going forward and understand them, then our solutions won’t be effective.