Tag: Big Tech

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In the latest episode, the Young Americans get super nerdy, with the help of real-life tech policy researcher Caleb Watney of the R Street Institute. He and Jack discuss the virtues of free markets vs. Millennial skepticism thereof, question the emerging conventional wisdom on tech addiction and Silicon Valley, rebut the Unabomber (!), and go […]

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Contributor Post Created with Sketch. US Economy Might Be Growing Faster Than We Think

 

The economics team at Goldman Sachs has made another run at trying to determine whether official statistics are undermeasuring America’s rapidly evolving digital economy. The bank now believes even more strongly that “technological change is not fully reflected in the real output statistics.”

From a bottom-up perspective, there’s all that missing growth from free digital goods. From a top-down perspective, Goldman economists note that the “growth of domestically generated profits and incomes (GDI) is outpacing that of GDP, a departure from earlier decades” and that “US profits generated in tax havens totaled over $300bn in 2018, some of which represents unmeasured domestic production.”

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Contributor Post Created with Sketch. Recommended by Ricochet Members Created with Sketch. Facebook Censors Conservative Author Brad Thor

 

Someone at Facebook decided that paying to promote a post on your favorite internet destination is verboten. Carol Roth, host of The Roth Effect here at the Ricochet Audio Network, wanted to promote her latest episode, an interview with best-seller author Brad Thor, but was told she needed to get “authorized” to run ads about “social issues, elections or politics.” So what triggered the rejection? Was it her name, the name of her guest, Brad Thor, or was it the destination?

Here’s the ad she tried to buy:

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Contributor Post Created with Sketch. Don’t Ruin the Internet Over Flukey ‘Bias’ Incidents Like the One on Pinterest

 

What passes for “evidence” of Big Tech bias against the right tends to be of the anecdotal variety. A piece of content gets blocked or hidden. An account gets suspended or banned. And then conservative media goes crazy, charging that Silicon Valley is suppressing conservative thought and thinkers.

The latest controversy involves a Pinterest employee sending a series of internal documents to the right-wing political website Project Veritas. The documents supposedly prove flagrant discrimination against pro-life groups and religious conservatives. This whistleblower claims the documents show that Liveaction.org — a pro-life informational website with more than 3 million followers on social media — was unfairly added to a domain blacklist reserved for porn domains, which are prevented from being pinned by Pinterest.

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Contributor Post Created with Sketch. Washington’s War on Big Tech: Must There Be a Google?

 

If Washington’s War on Google has begun, when will it end? The Justice Department is apparently gearing up an investigation of the internet giant. And for what reason exactly? That’s unclear. But one 2012 Federal Trade Commission analysis might give us a hint. It described Google as “engaging in tactics that resulted in harm to many vertical competitors, and likely helped to entrench Google’s monopoly power over search and search advertising.”

Overseas, the European Commission has thrice fined Google for business practices deemed uncompetitive. The most recent came last March when regulators hit the company with a nearly $2 billion fine for past “abusive practices.” The EC said Google “abused its market dominance by imposing a number of restrictive clauses in contracts with third-party websites which prevented Google’s rivals from placing their search adverts on these websites.”

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The era of free lunches is over, at least in the tech industry. For decades Big Tech has relied on exponential growth in computing power to compensate for deficiencies in everything from management practices to programmer training. But no longer. The end of Moore’s law (the observation that transistor density tended to double every two […]

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Contributor Post Created with Sketch. Why America’s Social Media Firms Aren’t ‘Parasites’

 

It’s hard to be a big tech company these days without somebody rooting for your demise. But some cases are a bit more understandable than others. Like this one: “Bannon says killing Huawei more important than trade deal with China.” I mean, I get it. Former Trump White House adviser and nationalist Steve Bannon wants America to launch and win a Tech Cold War against China. Taking an ax to what might be its most important tech company, a key player in the global 5G rollout, might be a big step forward in such a plan.

But it’s not Americans wanting to shut down just Chinese tech companies. Sometimes it’s Americans going after American firms. “Maybe we’d be better off if Facebook disappeared,” writes Sen. Josh Hawley, a Missouri Republican, in an op-ed for USA Today. And his problem isn’t just with the social media giant run by Mark Zuckerberg. According to Hawley, Twitter and Instagram, though oddly not YouTube, are also “best understood as a parasite on productive investment, on meaningful relationships, on a healthy society,” He claims they’ve created an “addiction economy” based on extracting and selling data gleaned from uninformed users. The first sentence of the piece: “Social media consumers are getting wise to the joke that when the product is free, they’re the ones being sold.”

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Contributor Post Created with Sketch. Should We Tax Facebook and Google So They Change Their Business Models?

 

Paul Romer.
Is Big Tech today as dangerous as Big Money a decade ago? Economist and Nobel laureate Paul Romer seems to think there are disturbing similarities. In a New York Times op-ed, Romer advocates taxing revenue from the sales of targeted digital ads to check the size and power of “dominate digital platforms,” specifically Facebook and Google. “Our digital platforms may not be too big to fail,” he writes. “But they are too big to trust.” Romer’s policy goal is to nudge these companies away from the original sin of advertising-driven business models, and Romer sees a Pigovian tax as a more efficient way to reduce their size and influence than antitrust or regulation. He doesn’t like targeted ads, nor the financial power they generate.

Romer’s approach toward Big Tech might sound familiar to anyone who followed the post-Financial Crisis debate about Wall Street and “too big to fail.” Among the policy options for taming the megabanks and de-risking their business models were regulation, antitrust, or higher capital requirements. That last one, advocates argued, was the most efficient and market-friendly way of making failure less likely, potentially serving as a de facto tax on bigness, or even spurring a self-initiated breakup.

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One of the biggest debates ongoing within the right involves the regulation of Big Tech companies, namely Twitter, FaceBook, and Google. Briefly, the populists are on one side. They believe that American tech companies should follow free speech principles despite being private companies. Opposing them are the free marketeers, who also disagree with what these […]

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Contributor Post Created with Sketch. Can Washington Solve Facebook’s Problems?

 

If Mark Zuckerberg’s call for more government regulation of the tech sector had been published today rather than over weekend, some might have thought it an April Fools Day prank. After all, what company or industry wants more Washington meddling?

But there’s good reason for the Facebook boss to make just such an ask. Politicians on the left and the right have been pushing for new rules or even the break-up of the social media giant. And a slew of controversies has damaged its reputation — election meddling, data privacy, and what the company calls “controversial, harmful, and hateful” content — giving a further boost to anti-Facebook activists and pols.

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Contributor Post Created with Sketch. Does the US Really Risk Treating Its Tech Titans as National Champions?

 

If one fears the supposed malign impact of Big Tech on modern life — destroying competition, innovation, privacy, democracy, and our bainstems — then the prospect of Washington making them its special “national champions” must be horrifying. Government should counterweight big business power, these critics contend, not further enable its expansion and influence.

This is not unreasonable analysis. Companies should succeed globally by competitive excellence, not from the protection and subsidy of politicians at home. As Financial Times columnist Rana Foroohar argues in a new piece, “National growth strategies are welcome. National champions are not.”

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Contributor Post Created with Sketch. The Microsoft Myth: We Shouldn’t Assume More Antitrust Will Give Us More Tech Innovation

 

Sen. Elizabeth Warren argues that if Washington breaks up Big Tech — and more aggressively reviews acquisitions going forward — the result will be more competition and thus more innovation than would occur otherwise. Just look at history. As the Democratic presidential candidate explains in a blog post:

The government’s antitrust case against Microsoft helped clear a path for Internet companies like Google and Facebook to emerge. The story demonstrates why promoting competition is so important: it allows new, groundbreaking companies to grow and thrive — which pushes everyone in the marketplace to offer better products and services.

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Contributor Post Created with Sketch. Elizabeth Warren’s Wrongheaded Plan to Break Up Big Tech

 

An encouraging result of Sen. Elizabeth Warren’s mega-ambitious plan to break up Amazon, Alphabet-Google, and Facebook is her interview with The Washington Post tech reporter Cat Zakrzewski. At the end of the Q&A, Zakrzewski asked the Democratic 2020 contender, “How do you avoid unintended consequences on innovation if you break the companies up?” To which Warren replied, “I think what we have right now is the unintended consequence. The giants are destroying competition in one area after another.”

This is good. Warren allows for unintended consequences when implementing public policy. Little of the activist feverishness about a Big Tech breakup has acknowledged their existence or that of trade-offs. More should be expected of policymakers. Conceding the reality of both provides a starting point for debate. That said, Warren seems oblivious to the potential unintended consequences or trade-offs of her proposal.

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Contributor Post Created with Sketch. Another Example of So-Called Tech Monopolies Not Acting Like Monopolies

 

When one looks at the size, scale, and influence of America’s tech titans (companies that jealous Europe would love to have), it’s not surprising to think of them as monopolies. But as competition scholar Nicholas Petit explains in a recent conversation with me, “When you look at what those companies do it seems very different from what the old school textbook monopolist would do.”

They don’t act like fat and happy forever companies with not a competitive care in the world. Such as being in cutthroat competition with other dominant tech titans. As Andreessen Horowitz tech analyst Benedict Evans recently tweeted:

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In an episode of multiple firsts, Jack strikes out on his own to interview Matthew Hennessey, the deputy op-ed editor of the Wall Street Journal, author of Zero Hour for Gen X: How the Last Adult Generation Can Save America from Millennials, and, at 44, a decidedly un-young American. They discuss whether Millennials or Baby Boomers […]

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Contributor Post Created with Sketch. The New York Times Offers Another Underpowered Case for Breaking Up Big Tech

 
Former Alphabet Executive Chairman Eric Schmidt speaks to Sundar Pichai, Chief Executive Officer of Google.

Hot on the heels of Esquire’s 7,000-word argument against Big Tech comes the New York Times Magazine’s 8,000-word argument against Big Tech. Hed: “The Case Against Google.” Dek: “Critics say the search giant is squelching competition before it begins. Should the government step in?”

The piece’s author, Charles Duhigg, answers in the affirmative: “If you love Google, you should hope the government sues it for antitrust offenses — and you should hope it happens soon, because who knows what wondrous new creations are waiting patiently in the wings.”

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Contributor Post Created with Sketch. Now It’s Esquire’s Turn to Make the Case for Busting Up Big Tech. It’s Not Strong

 

The March issue of Esquire gives Scott Galloway, an NYU marketing professor, nearly 7,000 words to make his case for dismantling Apple, Amazon, Facebook, and Google. Galloway scare-quotes them as “the Four,” while the headline writer refers to them as “Silicon Valley’s Tax-Avoiding, Job-Killing, Soul-Sucking Machine.” (As a long-winded sobriquet, the latter really doesn’t have the oomph or stickiness as when Matt Taibbi famously referred to Goldman Sachs as “a great vampire squid wrapped around the face of humanity.” But a solid effort, I guess.)

So what is Galloway’s argument? Patient readers must plow through nearly half the essay — though many lovely charts will aid the journey — to find out. Before getting to his casus belli against the SVTAJKSSM, Galloway first runs through a series of “valid concerns” to whet the appetite for antitrust destruction: The Four are really, really big. The Four are addictive. “Google is our modern day god.” The Four don’t pay enough taxes. The Four are destroying massive numbers of jobs. Government has surrendered before the Four like the POTUS before Zod in “Superman.”

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Contributor Post Created with Sketch. Antitrust and Big Tech: Some Things to Keep in Mind

 

Democrats have turned on Big Tech. At least that’s the conclusion of Axios reporter Kim Hart in a new piece, “Tech’s new Washington problem: Democrats,” where she notes the “public shaming” of tech firms at this week’s hearing on Russian interference in the 2016 election.

And this all feeds into how Democrats are likely to make concentration of corporate power a big political issue in the coming years. As the congressional “Better Deal” agenda puts it: “We will crack down on monopolies and the concentration of economic power that has led to higher prices for consumers, workers, and small business — and make sure Wall Street never endangers Main Street again.”

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Contributor Post Created with Sketch. What’s the Upside of America Being Home to the Tech Giants?

 

As Tony “Iron Man” Stark once said, “Actually, [Captain America] is the boss. I just pay for everything and design everything and make everyone look cooler.” In a way, that is how I think about America’s tech giants. All they do is bring us great products and services while creating lots of jobs and wealth. That’s all. Europe would love to have them.

Of course, that doesn’t mean they didn’t mess up this Russian election interference thing. Nor does it mean they shouldn’t be regulated or reviewed by antitrust officials. Not at all. It’s just that they remain tremendous economic assets. Sometimes it’s easy to forget that, I guess.

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Contributor Post Created with Sketch. Will Apple, Google, Facebook, and Amazon Be Forever Dominant?

 
President Donald Trump, Satya Nadella of Microsoft, and Jeff Bezos of Amazon.

I’m skeptical that Washington will break up Big Tech like it did Standard Oil or AT&T. Likewise, New York Times tech columnist Farhad Manjoo also doubts such action is on the near horizon, or really governmental action of any kind. One difference is that Manjoo — who refers to Amazon, Apple, Facebook, Google, and Microsoft as the “Frightful Five” — seems far closer than I am to being convinced strong action is necessary. From his lede: “The tech giants are too big. They’re getting bigger. We can stop them. But in all likelihood, we won’t.”

Like I said, I’m not there yet. But one thing that could nudge me a bit closer is the certainty that the megaplatforms were dampening US innovation. And that’s just the argument being made, anecdotally at least, by Erin Griffith in Wired.

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