BigTech Monopolies Are Here to Stay
On Wednesday, the House Judiciary Committee held an antitrust hearing with the CEOs of four of the largest U.S. technology companies – Amazon, Apple, Facebook and Google. It was predictably mostly a farce that had the top 4 CEOs of BigTech refusing to even answer most Yes/No questions.
They spoke with legal variations of the same thing, we’re fine the way we are! They spoke with “pride” about what they have built: a platform-centric economy where free market capitalism in technology is no longer possible.
It’s not possible for startups to compete with Microsoft, Apple, Amazon, Google and Facebook, because they are the gatekeepers of the internet-AI bubble.
They are the supposed patriotic companies to defend us against a rising Chinese technology dynasty that’s directly state-backed. The FTC and Congress aren’t serious about breaking up BigTech. Not even close.
Policymakers on the Right and Left increasingly proclaim the importance of out-innovating China in critical technologies. But their comments during yesterday’s hearing missed the key point: with gatekeeper platform monopolies, innovation in the U.S. tech sector is mostly dead.
From Apple taxes to Amazon abusing its third party sellers, to Facebook copying and cloning rivals and to Google stealing content and de-listing companies, the BigTech abuse of the antitrust variety is now common knowledge.
Yet the U.S., in its plight for technological colonialistic super-power nationalism, is too scared to go against them. This is like handing over the keys to the future to China.
American BigTech won’t be able to keep pace with the innovation-centric economy of China’s technology sector. Even with superior talent and global penetration in 2020, China can literally buy their way into the future. Even Google, Microsoft and Apple pander to China, because they know they will win.
Google works hand in hand with Chinese Universities and projects like Dragonfly. Its work on smart speakers with Huawei and by Waymo One with Volvo (owned by Chiense Geely) proves it.
Keeping our BigTech monopolies intact destroys free-market capitalism in Silicon Valley that has already been slipping each year farther and farther behind China. Not breaking up these BigTech monopolies is the knock-out punch China needs to keeping pulling ahead and catching up in artificial intelligence.
Democrats on the Committee suggested that these companies’ success threatens the free market and even democracy itself. Numerous Republicans raised concerns about their alleged political bias as well as their size.
But most of the important issues and key questions for the future of technology remained unsaid. It pointed to how oblivious congress is about the future of AI, technology and the cold-tech wars.
Huawei is not dead, TikTok isn’t banned and China is doing a much better job of improving its technology. Meanwhile American BigTech is bloated and more aggressive than ever in pushing down American competitors, abusing small businesses, ruthlessly disrupting existing industries and gaining marketshare and power. This won’t end well for the United States.
Meanwhile, in China, the government is taking an opposite course. Instead of attacking its “national champions,” China is showering them with government subsidies and discriminating against “would-be” competitors to great effect.
China is letting their tech dynasty invest and become the best venture capitalists to stimulate even more startups. ByteDance could grow in China but not in the U.S. in the current climate. Facebook would have destroyed it a long time ago.
In the future of innovation, monopolies are poison. The United States had already lost the cold-tech wars before they even began. It might take ten years, it might take 15 years, but it is now inevitable. The lack of antitrust regulation or AI regulation in the U.S. shows this. Silicon Valley is failing, but the U.S. isn’t even admitting this to be a fact.
Ten years ago, nearly all of the top technology companies and start-ups in the world were American. Now, China has nine of the top 20 technology companies and four of the top 10 start-ups. And this trend appears likely to continue.
American leadership has no idea what it is doing. America will be powerless to stop China’s economic and technological ascent that will mean it surpasses the U.S. before 2030.
In mobile, in E-commerce, in retail innovation and gaming it has already taken place. China has a more mature digital economy. How long before China catches up in the Cloud and in AI? Ten to fifteen years would be a conservative estimate.
China’s system of innovation from state-backing global companies to its venture capital system is just superior. That a handful of companies at the top of the NASDAQ is all America has to offer the world in the early 21st century is not comforting. What happens when Chinese companies begin to out-compete them? It means the United States becomes far less dominant globally and economically in the future.
China recently passed the United States in the number of global patent applications and is on track to eclipse U.S. research and development spending in the next two years, according to the Organisation for Economic Cooperation and Development.
The antitrust hearings were a farce and a low quality show which depicts an empire in decline. The Internet Princes mostly made fun of the questions with their obscure answers. Any critical audience could see it. They have no real fear of regulation or being broken up — because with powerful lobbyists and a corrupt system, Silicon Valley owns America.
The great digital advertisers of America do what they want, even if it means unfair play, cheating and choking their rivals while favoring their platforms with their own products. That’s not a great show of American capitalism. It’s a global embarrassment of riches. It’s an America that the world doesn’t want to see win in the future.
Amazon, Apple, Facebook and Google are not the only important U.S. technology companies, but they spend a disproportionate amount on research and development in key areas like artificial intelligence, quantum computing, and robotics while outbidding for the top young talented engineers and future corporate managers.
That’s not free-market capitalism, that’s the zenith of greed-is-good capitalism that will be unable to compete with China.
The U.S. created gatekeeper companies in the hopes that American capitalism would win, but Silicon Valley’s rise was short lived in the grand scheme of things. It too was copied. IP theft did occur. And Chinese innovation paves the way to a new global order. The GAMA companies won’t last forever — Google, Amazon, Microsoft and Apple. It might seem like it now in 2020 while they are at the height of their power.
America isn’t even honest with itself about the consequences of antitrust on innovation. How can it keep winning? These companies aren’t “good actors” in the world and young people increasingly are recognizing this. The House Judiciary Committee held an antitrust hearing with the CEOs of four of the largest U.S. technology companies , and it showed just how corrupt American has become. Capitalism craves winners, but America is not a future winner when antitrust regulation is absent.
The future of artificial intelligence belongs to China, not America, and the antitrust hearing proved it.