Breaking Up Amazon Becomes Closer to Reality
With the cold-tech with China, many U.S. officials believe you need super platforms like Amazon, Google, Microsoft and Facebook in order to compete. However the antitrust movement against them is gaining steam.
Tim Bray, a senior engineer and vice president at Amazon Web Services, has quit his job because he was “dismayed”, he wrote in a blog post, that the company fired whistleblowers who were trying to draw attention to the dire straits of Amazon warehouse workers. Tim is also an advocate of AWS being spun out as a separate company in addition to other BigTech American companies, to create a more fair marketplace.
In a corporate socially responsible (CSR) society, antitrust, ESG investing and reducing inequality and increasing diversity are all increasingly important.
2021 will be the year of corporate justice and social justice in business, and if that comes to pass, here are the moves that make the most sense:
How BigTech Should be Broken Up
- Facebook, Instagram, WhatsApp, Facebook Pay & Libra being run as separate entities with better oversight & regulation. (4 companies)
- Youtube, Google Cloud, Google Maps, Google Home, Google Health, Android, Waymo One and possibly DeepMind (when it becomes profitable/if ever), being spun out from Alphabet. (9 companies)
- AWS, Alexa, Twitch Gaming (merge Twitch and Amazon Game Studios) being spun out from Amazon. (4 companies)
- Azure, Microsoft Gaming and LinkedIn Connect (merging LinkedIn with GitHub) being spun out from Microsoft. (4 companies)
- App Store, Apple Pay, Siri, Project Titan (Apple Car), Apple Wearables, being spun out from Apple. (6 companies)
To give you an analogy it’s as if BigTech lives in an imaginary world of the past where Tesla, SpaceX, OpenAI , Neuralink and StarLink were all one company called Musk Inc., to use the projects of Elon Musk as an example.
Having entities worth more than $400 billion just really doesn’t make sense if you want a fair and free market capitalism to function properly in a robust economy where the optimal levels of innovation, job creation and profitability are all occurring.
We know that in 2020 there is already significant antitrust work coming for Google and possibly Facebook. Antitrust must clean up Silicon Valley sooner rather than later. This also has an impact on the future of America. Antitrust regulation is important for how AI develops in the 21st century and for the future of business.
What this does is increase fair competition in America’s marketplace where it’s becoming less innovative as compared with China. Alibaba for instance already spun out Ant Financial Group a long time ago. This would also enable American BigTech to be better venture-capital partners with growing startups that they would view less like competition.
Microsoft is again coming under scrutiny for its business competition against Slack with Microsoft Teams. Microsoft, Amazon, Facebook, Google and Apple have for decades used their platform centric business models to out-compete more innovative but less wealthy competitors. We’ve also seen this in the retail apocalypse that Amazon has hastened with its monopoly in E-commerce penetration the West.
The Global Tech Platforms Wars of the 2020-2040
Tim Bray’s stand is important because it shows even internally in these BigTech companies, people realize that what they are doing is not fair or good for capitalism and free-market capitalism as it used to exist.
Even Twitter is considering a subscription business model as its Ad revenues drop in the pandemic (much like its little sister Medium that has become a private to play platform).
America needs to think about corporate justice and realigning American capitalism with contemporary values. Its greed is good and winner-takes-all element in the stock market is also destroying competition, making it less innovative in the long run vs. China.
Tim Bray was interviewed on CNBC on July 24th, and I thought he made a lot of good points. The future of technology is not really the cold-tech war with China, but a global platform war. TikTok being possibly banned hurts ByteDance, but it’s still the more innovative company as compared with Facebook that has been left without antitrust action after having created a digital advertising duopoly with Google that has been very detrimental for global competition.
Amazon now is likely to join Facebook and Google in part ownership of Reliance Jio in India as the world map is fought over in the platform wars and with the cold-tech war style of America vs. China.
The emergence of the EV sector with Tesla and dozens of rising competitors make for a new automobile market where EV, hydrogen and autonomous vehicles create the most exciting competition in decades for huge future revenue streams in the future of transportation.
The platform wars however do need regulation since it’s also about regulating the future of consumer rights in an artificial intelligence, IoT and 5G world. Tim Bray’s interview of today isn’t out yet on YouTube, but here is a related piece I found. Fast forward to 19:41 to hear Tim Bray make some of his points.
In a world of global tech platforms ever increasing their power and domination, protecting human rights, data privacy and digital identity in a world of artificial intelligence will be next to impossible. This is what at the Last Futurist we refer to the “Future Sin” impact of the future of technology.
The automation of jobs begins in the platform wars where massive wealth gaps and wealth inequality are accelerated, creating decades of future institutional inequality where Capitalism becomes distorted without a massive shift in regulatory frameworks and a complete reformation of capitalism and democracy in the era of artificial intelligence.
Wealth equality won’t be achieved and massive wealth gaps won’t be reduced without a major overhaul of Silicon Valley with antitrust regulation and cleaning up the distortions in the stock market.
America’s Failure in Anti-Trust: What it Means for the Future
Furthermore, the U.S. won’t be able to compete with China without a significant reduction in the stockpiling of talent in the most profitable platforms since this stunts real innovation outside of the duopolies in such areas as Cloud computing, digital advertising and the future of AI which are by far the most profitable sectors in technology.
To catch the summary of Tim Bray’s interview go here. In June, he suggested in a blog post that Amazon might choose to proactively split off AWS from the company as an effort to get ahead of looming antitrust scrutiny. The conflict of interest that AWS has become for potential competitors of Amazon in E-commerce or digital advertising has already become clear I think.
In addition to the companies that I mention above you can make a good case for breaking up the one platform to rule them all of course, called Apple too (update: I added it to the list). It’s not just a question however of fair market competition in capitalism, but one of national security and human rights in an age of AI. Let’s then just state the obvious guilt complex of Silicon Valley employees:
The dangerous platform technology companies of Silicon Valley have of course spawned a Chinese tech dynasty of state sponsored military collaborating companies that will supersede American companies in the evolution for surveillance capitalism where the winner will write the AI rules for the 21st century such as Alibaba, Huawei, ByteDance, Tencent, Ant Group, Baidu, Meituan, Didi, among others.