Facebook, Amazon, and Google will resist attempts to restrain their power—but it’s a fight we can’t afford to lose.
How did they get so big? In the 1980s, antitrust enforcers in the US became more tolerant of mergers or acquisitions that reinforced a company’s dominant position, as long as prices didn’t rise. That’s worked out well for internet companies, whose services are often free.
The problem with tech giants: Their outsized role in politics and culture means that if they mess up—by, say, insisting that Russian trolls don’t pose a threat to democracy—the results can be devastating. Then there’s the market power they’ve built up, which has stifled innovation in the areas they dominate like digital advertising.
What can we do about it? As our own Martin Giles argues, we need to find ways to bolster rival firms. Regulations can be crafted to help level the data playing field. For example, if one company is found guilty of anti-competitive behavior, a settlement could include a requirement that they must share some of their data with rivals. This strategy could be tested soon. Yesterday, the Supreme Court agreed to hear the App Store antitrust case.
How did they get so big? In the 1980s, antitrust enforcers in the US became more tolerant of mergers or acquisitions that reinforced a company’s dominant position, as long as prices didn’t rise. That’s worked out well for internet companies, whose services are often free.
The problem with tech giants: Their outsized role in politics and culture means that if they mess up—by, say, insisting that Russian trolls don’t pose a threat to democracy—the results can be devastating. Then there’s the market power they’ve built up, which has stifled innovation in the areas they dominate like digital advertising.
What can we do about it? As our own Martin Giles argues, we need to find ways to bolster rival firms. Regulations can be crafted to help level the data playing field. For example, if one company is found guilty of anti-competitive behavior, a settlement could include a requirement that they must share some of their data with rivals. This strategy could be tested soon. Yesterday, the Supreme Court agreed to hear the App Store antitrust case.
This piece will be featured in our July/August print issue on technology and the economy. Make sure to subscribe to our future of work newsletter Clocking In to be the first to see our cover, which we’ll reveal this Thursday. by mit download
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