U.S. states lean toward breaking up Google's ad tech business
cnbc.com
cnbc.com
The increasing trend of large tech conglomerates to use one money printing product like AWS or search or the Apple Store to tactically snipe competitors to destroy or acquire them is absolutely abysmal in the long run. I don't care if it increases consumer prices by 10 cents or whatever, it's time to look at the long term health of the ecosystem overall. It's really the private analog to a state capitalist country subsidizing its own firms while foreigners have to compete on a one-by-one basis. Everyone considers that to be detrimental when it happens between two nations, I don't see why it's not detrimental when it happens in the tech industry.
Exactly. My concern is that Google is being uniquely targeted, and that breaking them up and calling it a day just exposes us to further abuses from the rest of the tech industry. At least with Google, evil is divided across five tech giants that can serve as checks against one another, instead of merely four.
Similarly, I feel that the tech industry as a whole, while far from not evil, has emerged with a set of interests distinct from those of other monopolies, and helped protect the internet from being subordinated to the interests of telecoms. Which isn't to say that I enjoy monopolies, far from it. I just want to see similar willpower to break up the giants of other industries.
For that matter, if we really have to go the route of the uniquely targeting a specific tech company, I would at least start with Amazon and then Facebook. Or if we thought more broadly than just tech, I would start with the oil industry giants, finance industry giants, and then telecoms, and then health insurance companies, and then Amazon and Facebook.
I find it interesting that we're reasoning in terms of balance of power, pre-eminence, and hegemony, to address issues related to a few companies. Cardinal de Richelieu sure would have found his footing.
No wonder some Google had a "Head of International Relations" whose job is to deal with diplomats, the U.N and the like[^1]. I believe Condoleezza Rice is also on the board of Dropbox.
[^1]: https://medium.com/@rossformaine/i-was-googles-head-of-inter...
Perhaps all this familiarity is finally breeding contempt from certain quarters? Perhaps it’s a bit of envy on both sides; nations envious of multinational profits and reach, and multinational firms envious of national self-justifying existence.
I wonder how long til Starlink starts providing extraterritorial/extraterrestrial VPS?
That's literally how every company ever in any industry since the dawn of commerce has operated. You use profits to grow and diversify. You can't perform capital expenditure without capital...
[0] https://www.aei.org/technology-and-innovation/who-should-ant...
The thing is, amoral behavior can be seen left and right, through large part of history of Silicon Valley (remember Gates & Jobs & Xerox).
To me as an end consumer, Facebook has a true monopoly and progressively shittier products compared to Google - ads comprising half of my feed, their core product is still broken and buggy in many places but that's another topic. Recent UI changes made it much worse product. Google looks great compared. But again that's very personal and limited view.
So was slavery. Yet somehow we managed to legislate that away.
Go to telecommunications and break the big players up and create marketplaces in which small players can innovate. Do it in news media and undo that awful communications act from 96 that led to industry concentration.
We need to take an activist attitude to anti-trust that actively seeks to create rabidly competitive markets which is what fuelled early tech's growth, instead of letting tech slide into the status quo.
And of course all of these companies will still have access to capital. They'll just need to convince investors that their product is better.
Telecom and the like are the same, competition leads to fragmentation and destruction of opportunity. Monopolies lead to bad platforms, but platforms that hit the scale divided and broken half solutions never will.
I’m way more concerned by Facebook in terms of monopoly, because here I truly don’t have a choice between products, just to opt out with social consequences. That’s not the case with search or email.
Google is an ad company; their product is an audience and an advertising system. There is no reason that advertising should be untouchable except at scale. There are plenty of tiny players who eke out a profitable existence at small scale with ads. It is likely there is a path from there up into a mega-giant if someone really goes to look for it.
If anything, advertising might suffer diseconomies of scale for most products. Small businesses want to advertise locally.
The entire purpose of injecting capital in such large amounts is to prevent competition. That's literally the entire point.
The former benefits consumers by giving them more choice. The latter gives consumers lower prices in the short term, but then hurts them overall when the competitors are forced out and prices inevitably rise again, this time without any competitive pressure to keep costs low, margins reasonable, and product/service quality high.
And regardless of whether or not the latter is common, or has always been common, I maintain that it is a huge negative aspect of capitalism that destroys wealth, creates inefficiency, and hurts consumers. Regulation that targets that practice would be welcome.
Can you provide a contempory example of this happening?
Google and Facebook. The two biggest ad auction oligopolies own virtually all of ad-space between them. Is there real competition? No, there isn't.
Apple. More and more locked down, less and less reliable, more and more expensive. Want to move? Want to repair something out of warranty? That's going to be... difficult.
Ebay + PayPal. If one doesn't screw on fees, the other will screw you on fees. Ideally both will screw you on fees. Now with added Etsy, because also.
Amazon. The giant changes its mind because something something ToS violation and leaves you with n figures of dead inventory and a locked pay out. What are you going to do?
Spotify. You pay us for the music, we don't pay the artists. [1]
YouTube. The record companies get income even if they don't have the rights to it, for the bargain price of a robo copyright claim. Because recognition algos are so very complicated and they make such terrible mistakes, so much of the time.
These aren't just monopolies, they're massive market distortions where money is so dense it warps the Internet into stagnant pools of pseudo-inevitability, with a chilling effect on real innovation and creativity.
And that's not even getting into issues of privacy, political influence, and the market value of personal data.
[1] Not technically true, but considering the pitiful pay outs it might as well be.
Then they can increase prices a bit, although the main profit source is in reducing unit costs now you have a big business and making all your profit through volume.
It's certainly non-ideal for customers, but at the same time I think customers usually get a better service for a lower price than in a world with hundreds of competing companies (where overheads work out much larger)
Now AMD's managed to claw black some of the market for itself, but it is still at a huge disadvantage compared to Intel. And AMD's only lucky that IBM insisted on two independent OEMs for its PC CPU's and that Intel wanted that deal bad enough.
When it comes to the desktop CPU market itself, x86 has an unquestionable monopoly and no new player can attempt to design x86 chips without getting sued. But without x86 there's no point designing desktop chips in the first place.
Not even close to true, you're describing how "financial capitalism" works which is relatively modern (in the US, it begin in the early 1900s after the creation of the Federal Reserve). Until you financialize an economy, businesses can't use that kind of strategy to compete. Once you do, only those with access to finance can win.
Read up on industrial capitalism which relies on the quality of products and services—not access to finance, aka money printing—to compete in the marketplace. That's how the US was built originally, and what most Americans mean when they say they support "capitalism."
Prior to its monopolization actions, Standard Oil was a successful industrial capitalism firm: they had better oil refinery tech than the competition which is how they came into having money to re-invest in the first place.
Your examples are nations, not businesses. Obviously the economics of warfare are different: money (and resources more generally) are how you defeat your "enemies."
I'm talking about capitalism, both industrial (Wealth of Nations-style) and modern financial capitalism which is the domain of business and markets, not war.
However all these companies compete on a global stage. You better believe that Huawei, tencent, Alibaba are going to take advantage of weakened US companies.
There are a handful a tech companies from Europe that operate globally, but they're usually niche (Spotify, Minecraft, Qwant).
Sure, they are no Google or Amazon, but they are or were nothing to sneeze at either
I'm also highly doubtful that this is mainly because of anti-trust laws.
A much more likely reason to me seems that Europe is much more diversified in law and culture, a Paris company has a much harder time expanding to London or Berlin than an San Fransisco one will have for Los Angeles or New York. This naturally leads to more, smaller companies.
> A much more likely reason to me seems that Europe is much more diversified in law and culture, a Paris company has a much harder time expanding to London or Berlin than an San Fransisco one will have for Los Angeles or New York. This naturally leads to more, smaller companies.
I am not sure that's the case. The EU car companies had overtaken the US car companies, inspite of the above scenarios.
Fun fact: Nokia now owns Bell Labs.
i.e. EU companies are not as competitive, presumably lack scale for lower pricing, lack scale to invest into expensive R&D
And that's bad for consumers
Google can, and has, change the web single handedly. Other companies and browser-makers have no choice but to follow due to Chrome's enormous market share and Google's massive market change in services.. I wouldn't call that good for consumers.
AMD has significantly better processors at the moment on a sliver of Intel's R&D budget. Innovation is happening at startups and small companies (which are then bought by the incumbents). I highly contest your statement that Google size is necessary for the best consumer R&D.
Sure you can get some economies of scale as a monopoly, but it comes with a lot of corruption, incompetence, and anti-competitive behavior.
I also think that a hamstrung western company will be steamrolled by international companies with significant state backing/support.
This isn’t a simple equation, there are second and third order effects that we can’t appreciate until after the fact.
In the car industry people actually listened and enacted domestic protection, what did that get the US? Two lost decades of shoddy cars. Have Japanese conglomerates overtaken the world? Nope.
I think it's an absolute smokescreen and such a blatant attempt by Facebook to use nationalism to protect their status. In the long run we're better served by trusting in innovation than trying to protect domestic business. It was always the right bet. And if China continues to prop up giants they'll just stagnate. The reason they caught up in the first place is because, for at least a short time, they allowed free-wheeling fierce competition.
[1]https://www.econlib.org/archives/2009/12/why_were_americ.htm...
Toyota, Honda, Nissan - they pretty much dominate global car sales, but that’s because they had a better product.
Google is far worse than Facebook. The amount of hackers ok with what google does is just sad.
You're confusing competitive behavior with anti-competitive. When a company throws money at consumers in order to get their business, that's competitive.
Best expressed as: "To turn 100 dollars into 110 is work. To turn 100 million into 110 million is inevitable." -- Edgar Bronfman, Sr.
It doesn't matter what you think..The only thing that matters is whether they have the legal authority and can show the consumers are harmed.
Amazon selling their in-house brand based on their private sales data could meet that threshold. Amazon making money on AWS, OTOH, will probably not meet that threshold.
We can divide up the world into little boxes and carefully decide who is allowed to participate in each box. Hell, we can go back to giving people occupational surnames - if your name is Smith or Barber or Carpenter, your box is already picked out for you. GET BACK IN.
<It's a slippery slope to do something once?> <Apples to oranges comparison about Apple, Inc which never had close to a monopoly> <Something about the justification for breaking up a company that's also apples to oranges> <Whataboutism>
<Something about central planning that isn't clear and doesn't apply to monopoly power>
When the biggest complaint that people have about these companies is that their services are too good and too amazing, and that customers love them too much, that no one else can possibly provide as amazing of a service as them... Well I think that says something.
Yes, they missed the mobile boat and were late to IaaS/PaaS, but to dismiss them for nearly two decades is perhaps unfair.
IMO their biggest failure was losing their developer base. DevDiv really seems to have fallen asleep at the wheel - or to have been neutralized by the OS group.
[0]: https://www.statista.com/statistics/267805/microsofts-global...
The biggest years of profitability for most tech companies come after their innovation heyday (when they've already established their market position and no longer reinvest large amounts of cash into new product development), but without continued innovation a tech business eventually fades away into irrelevance.
Not that I’m complaining - the surface line revitalized laptop and stylus tech for windows.
Azure also kind of just plays better with the whole Active Directory / Office 365 / Sharepoint ecosystem and many Azure products are substantially cheaper than AWS.
No. Microsoft didn't IPO until 1986. So after the mid 80s to the early 90s.
> when they were both microscopic compared to anything today?
Well, both apple and microsoft were "microscopic" in the 90s compared to what they are now. But still apple was the star tech company of the 80s and microsoft was the star tech company of the 90s.
> Not really a valid comparison.
It actually is if we are being honest. But that wasn't my point. Was just pointing out that once Apple was the big success compared to microsoft because microsoft became the big success. But you can cherrypick dates to fit whatever narrative you wish.
Gmail is basically synonymous with email today, and no one wants to use email now. What does that really say about Gmail, then? Never mind the fact that they pretty much killed off non-Google mail servers.
In my opinion, HN is better off. You have a good underlying point (that Inbox was exactly what GP wanted), but why write it that way?
It's certainly not still funny after the 1000th (or even 2nd) time reading it, and it's harder to understand for people who aren't in on the joke or speak English as a second language.
Maybe someone that has been there more recently can attest or counter my point, but it seemed to at least leave a surface wound on the culture.
Perhaps because the natural organizational tendency was to conspire to create user lock-in and other nefarious practices? 95% of software companies (I am guessing here) don't need to consult their lawyers during software development.
> review cycles became slower
"Q: But why can't I force the users to also install Internet Explorer?
A: You just can't Johnny, you'll have to rewrite this component."
> and execs became complacent
... after being really sharp and on-it before.
Bottom line: Cry me a river.
I’m not suggesting that he’s lying, but it’s important to remember that the anti-trust action likely had a financial impact on him, particularly if he had a lot of comp tied up in company stock.
Here we are 20 something years later and Microsoft looks to be just doing just fine to me.
Microsoft made plenty of money between 1998 and 2014. They also basically ceased innovating. I was a child and teenager during Microsoft's glory days from 1985-2000. They were basically unstoppable: if you thought you had a good software-related idea, Microsoft was already doing it, doing it better, and bringing some nasty market-power tricks to bear (much like Google in their glory days from ~2000-2015). I started my career soon after the DoJ consent decree, and Microsoft became a joke. They were the 800 lb. gorilla that sat in the corner milking their Windows/IE/Office monopolies (and eventually losing them) while the web became a bigger platform than Windows ever was.
Losing them? Nearly all the business workspace I know is Windows-only. Maybe not in Silicon Valley or top tech schools, but Windows is the norm for most businesses. It's not a competitive marketplace.
Quite often, I see wealthy, influential members of the tech community speak out against regulatory function citing things like lost innovation, when the reality is that they were pretty financially motivated to disparage government action in the first place. Again, that’s not to say that this executive was lying, but he clearly makes negative statements around the antitrust case and had a clear financial reason for doing so. He’s not a neutral party making an objective observation here.
/r/selfawarewolves
That is not to say it is not worth sending Google through a similar period of moribundity until they find new leadership and markets to pursue.
As they should be at a large corporation that was known for abusing its market power. It's not like engineers are experts in whether a feature breaks the law or not -- nor are they supposed to be.
> review cycles became slower
Oh come on, legal approval is just one more checkbox along with 20 others. And if it's slowing down reviews for a few important features or products, that's the point -- that legal considerations actually get considered rather than ignored or steamrolled over. The same way there are approvals for privacy, security, accessibility, and so on that are "slower" -- again, that's the point.
> execs became complacent
I don't believe this for a second. Execs at every company want to meet/beat metrics, get promoted, and make more salary. Nobody's complacent ever. The idea that execs become "complacent" because of a single highly targeted regulation is baloney. It's a total fiction invented for political lobbying purposes. Remember: removing monopoly abuse means a company has to work harder to to compete, instead of resting complacently on lazy market dominance. If anything, these execs were forced to be less complacent. But it's a nice lie they're trying to tell.
"Full stack engineer" gets ever more all-encompassing.
> If anything, these execs were forced to be less complacent.
An alternative explanation would be that the hypercompetitive win-at-all-costs types left for less regulated pastures, leaving the more complacent ones.
Google has been stagnating for more than one decade. What have they created since 2010 that is even remotely interesting, let alone in the interest of society?
And Amazon is Rube Goldberg machine of human suffering. Who cares?
You can make your substantive points thoughtfully without damaging this place in the process. Please do it that way instead.
Translate has gotten a hell of a lot better and it's been helpful for humanity, for one thing.
- Google Assistant is advanced magic. Much better than Apple's Siri or Amazon's Alexa, IMO.
- Google Photos is great.
- TensorFlow is close to its industry's standard.
- Chromebooks and Chrome OS are a hit.
- The Pixel line of phones is great, especially their industry leading camera innovations.
Sounds doubtful. I would guess there are more people here who have already been there done that at one of the big tech companies then there are people sitting around jealous.
Some google products could stand on their own (Google Cloud) but most would have a lot of trouble. The worst case is open-source offerings like Android and Chrome which only make sense as part of a wider corporate strategy.
Maybe I'm busting out my tinfoil hat, but I think that's the point. YouTube and other businesses wouldn't be able to survive without Google's ad money.
In my experience traditional media companies are the ones most heavily pushing for Google's breakup. Is this due to genuine fear of monopoly, or due to the desire to eliminate a competitor encroaching on their revenue sources?
So youtube and google drive basically die, some of the most useful free services available right now. I think this does more bad than good and I don't think any American citizen would support this given the effects.
The tech stance so far has been don't bother us and we'll continue to innovate, grow earnings and help users do cool things and investors make some money in the market. That has worked tremendously well for both the companies and their customers. I don't think changing that is in the users' interests at all.
I don't trust big media to provide accurate reporting here because they don't have the best of the relationships with G / FB.
Let's have privacy laws or platform regulation laws regarding censorship / free speech. Breaking big tech up is pointless.
Nobody is willing to pay for mobile operating systems either. Maybe hardware manufacturers would pay to move Android forward as an open-source project but most likely outcome is a stagnant fragmented mess.
It'd def be messy to untangle backends though. One imagines that the play store relies heavily on CDNs by Google, as one random small example from the haystack of papercuts.
Yes. They can still sell ads, just not inhouse.
To start somewhere, everything that was an acquisition 'should' stand on its own, because it began as a complete company. Of course things aren't that simple.
In many/most cases, "complete" companies that are losing money hand over fist or--in the better cases--have a business model but not great long-term prospects.
In fact, I would expect them to actively censor and promote their interests. Also, would other people just not be allowed to make search engines? Wouldn't google v2 just take over again?
In a very idealistic case, I would even go further and say it should be under the umbrella of the UN to accommodate other cultures, and be politics-agnostic.
I do believe that we are at the time when decent internet access should be pushed by the UN (or any other entity, hopefully in a non-commercial non-political way like food, shelter, and education.
Maybe I'm not seeing it right, but IMO Google seems less predatory than they could be... they aren't anywhere near Amazon level.
I think there are too many well connected, well funded media companies that are lobbying and retaliating behind the scenes as they see their news publishing business models get disrupted by the Google News aggregator. Couple that with politicians frustrated by the Google News opaque aggregation algorithm and that leads to anti-trust rulings.
https://www.investopedia.com/news/facebook-google-digital-ad...
Its one thing to serve ads on the bottom (i.e. ads for pentalope screw drivers against articles about pentalope screw drivers). Its another thing to encroach on establish media outlets turf, AMP up their content and sell ads to Auto, CPG and Airline companies based on that content.
Note that the viewpoint that antitrust is SOLELY about benefit to consumers, and not also about restricting corporate power, is relatively new in US antitrust jurisprudence (around the 80s I think), and there are currently many scholars reassessing this viewpoint.
Edit: Some more info about current reassessment of the Chicago School of Antitrust: https://www.law.uchicago.edu/news/reassessing-chicago-school...
Commodity monopolies on the other hand seem to have much more obvious detrimental effects longterm.
1. Android -> Difficult to compete against a well financed Chinese competitor here for whatever new subpart of Google takes over android.
2. Chrome -> Again, either MSFT or a chinese fork.
3. Gmail -> Outlook, or maybe some chinese/russian mail service
4. Google Cloud -> This might be gone fully. I don't see them having any advantages if they can't piggyback on the world class google Infra.
Even if the US regulates out Huwaei and Alibaba, almost all of Asia and Africa will surely be dominated by big Chinese tech, rather than small US tech if the US big tech get broken up. Not to mention they might dominate Europe too.
Gmail or google cloud's dependencies on the rest of Google are comparibly much easier to solve.
This will result in decreasing inequality and help the general society as well.
There is a good reason why anti-trust laws exist people. Billionaires are already a policy failure, we don’t need trillionaires in future as well.
Why do you think smaller EU/US firms are more likely to take their place than Big Chinese firms. The Big Chinese firms will have economies of scale and more capital.
> This will result in decreasing inequality and help the general society as well.
I don't know how is that going to decrease inequality. Even if big tech is replaced by 5 small tech, there is no way on earth it will decrease inequality. Do you have any basis for such an extraordinary claim?
> There is a good reason why anti-trust laws exist people. Billionaires are already a policy failure, we don’t need trillionaires in future as well.
Sure. In the totally globalised world, you can decide you don't want big companies. This will just ensure a Chinese company dominates the market.
I never worked at google but I’m willing to bet giant firms like Google have bunch of problems with their organization size which limits their code quality, product delivery times, and their agileness. A smaller, more agile company can definitely produce better products than Google (case in point: protonmail).
It will decrease income inequality because profits will go to different shareholders / employees.
Possible, but I didn't talk about software quality, I talked about number of users.
> (case in point: protonmail).
I think your case undermines your argument. Protonmail is not a very successful product. It is behind even many paid mail services. If that is your idea of success then sure, many small companies will become like protonmail, while tencent mail might become the new gmail.
What are we waiting on?
Chinese tech giants might take market share from Google, but other American companies will pop up with new and better technology that will ultimately come out on top, like it always does. The Chinese tech giants of today are giants largely because of government funding and government-sponsored corporate espionage/stolen tech, not because they're leading the world in producing new technologies.
As for Microsoft? If a behemoth like Google gets broken up for anti-competitive practices, regulators will likely not want to stop there.
More competition is always a good thing, even if it sounds scary.
Golang, gRPC, Protobuf, Kubernetes, Tensorflow, WebRTC, QUIC protocol, very interesting innovations in camera technology such as NightSight, Google Maps which has changed my life completely. Furthermore, millions of contributions to open source projects and protocols, so many security improvements by the Security & Cryptography teams that I have on occasion worked with.
Personally I wouldn't work for Google because I don't enjoy the kind of atmosphere where there's no real "mission". But doing this much innovation is impossible unless you are funded by the government, or have a money printing business.
We've switched to the CNBC article now, but it clearly should have been the one submitted in the first place.
Remember the baby bells? In 1982, AT&T (ma bell) lost an anti-trust lawsuit and was broken up into 8 companies (the baby bells).
Guess what happened since? If you guessed they merged back together, you would be correct. The baby bells merged back together and became 3 companies - AT&T, Verizon, and CenturyLink.
For those who are customers of AT&T - how do you like your service? Is it as good as Google?
Oligopoly is the new monopoly. Financial services, airlines, oil majors, media, pharma, auto, etc. Those are the industries that need breaking up. You pay for their services / products and they price fix (airline baggage fees, overdraft fees, etc), you don't even pay for Google. You can easily use duckduckgo and delete your FB / Insta with no consequence.
Edit - to address the comments saying that the tech companies should be broken up: sure, but how exactly? Google and Facebook in particular. You don't even pay for their services, so you (the citizens) can't claim consumer protection from their business. Only the companies / individuals that pay for Google and Facebook ads can.
Again, I get the frustration of the times and misinformation sucks, but Google and Facebook are not the cause. They are the means of distributing info (including ads that are sometimes just fake new), not the root source of all evil.
> For those who are customers of AT&T - how do you like your service? Is it as good as Google?
Since you asked... AT&T is way better, here in Oakland and also in Austin (fiber). It's always up and there's actually decent customer support you can call. Their cellular service has been great too. Meanwhile, Google's search has turned into a content marketing delivery machine, and Google Drive web UI still cannot catch up to Windows 95 File Explorer features&performance.
But if you asked me which company can ruin my life or my company's future due to a glitch in an algorithm, the answer will be Google, not AT&T. I worry that Google is allowed to control both the search and the web browser everyone uses. I also worry that as Youtube is becoming increasingly more important for video, they'll control the "future of TV" as well. I am less worried about "dumb pipes" which is what AT&T is to me, especially with the latest migration to encryption for everything, even DNS.
Seconded.
I can also call AT&T and, eventually, reach someone. If I'm angry enough, I can ask to be routed to cancellation. (They fix things quicker.) If things go awry, I can threaten, and act on the threat, to escalate matters to my state regulator.
None of these are options with Google.
It's now at the point where new entrants don't even attempt to start small. They explicitly dump massive sums in a bid to break in. It seems that this is happening even in areas where it's not warranted (local food delivery???).
It's as if the culture of every business has become captivated by the idea of becoming an oligopoly. My guess is because it's extremely attractive -- once you "make it" you don't have to compete any more.
It works, right up until it doesn't. I hope at some point, we make a big change in the level of corporate consolidation we allow.
So our clients often are people googling desperately trying to make their suddenly stopped factory resume work, then they see our ads and buy from us.
It became obvious to us that Google is a threat, they changed rules multiple times in the past to encourage fraud (instead of stopping fraud), our revenue is directly proportional to the Google ads spend, and whenever we find a better ad provider, Google buys it.
Only possible competitor for Google is TV, but TV ads are way beyond our budget and we have no idea of they would work, considering our niche.
So... Google is not only a monopoly, it is an obvious one, and they abuse their power freely.
On the surface social media looks completely benign, but they have these far reaching insidious impacts. Our elected representatives don't even have a basic understanding of how these sites operate... yet you have the majority of the population being fed content by these algorithms that determine what you see when, and they're completely opaque. They've got scores of analysts and psychologists shaping this stuff full-time... no single entity in human history has had this level of data and reach into human behavior, and it's all proprietary.
Small intentional changes over time to such wide-reaching algorithms can literally shape humanity in ways that may be entirely impossible for an outsider to detect.
My gut tells me that there's no financial incentive for the government to target them. I.E. telco lobbies
As far as I understand the problem in the US is that many locations have just one wired service provider. Meaningful competitions would require that most buildings have multiple sets of fiber.
Splitting telecoms by geography seems pointless: California and Texas ISPs can't compete with each other without huge capital spending.
I ran a speedtest on fast.com and got 985Mbps. The service uptime and quality has been utterly stellar. AT&T has been really good to me, but not everyone has access to 1G fiber.
The question is whether this type of comment "[Google/Facebook] is not the problem..." is a not-so-clever attempt to defend a FAANG company or whether it is legitimiate. I have seen this type of response many times on HN. It is like someone saying "Don't look there, look here." Of course, we can look both here and there, one step at a time.
What is a legitimate argument why breaking up Google/Facebook prevents the government from later breaking up telecoms, or solving any other problem.
Whereas if the telecoms were broken up, how does that improve the situation with the ad tech oligarchy. Even if you say "Don't look there, look here" eventually we may look "there". The harmful effects of Google/Facebook cannot be easily overhsadowed by other problems.
Great. Break up Google, in addition to those industries, as well.
You don't pay for Google with cash. You pay for Google by submitting your free will.
My email and search though is just a few options and realistically most of my family and friends just one option. Even if I move to the other side of the world that option is still the same.
That is a very misleading comparison. For almost all of the industries you've listed a) there are spatial limitations of monopolistic outreach (they have to exist in real world and can't exist all around the world at once) b) their products and services don't grow upon themselves exponentially c) the nature of their products and services is rather common knowledge. I'll go one by one;
a) Tech doesn't suffer from the spatial dynamics of competition and in that has virtually infinite economies of scale. A cable company has to fight for the right of physically laying cables, which creates a barrier of entry for the next competitor, but they have to do this work repeatedly in every other location. As long as bandwidth and compute is paid for, tech can be instantaneously omni-present around the world. This means the monopoly having a planet wide breadth, but also that margins required to sustain the monopoly can be much smaller.
b) Econ 101 has this classic output function: labor x capital x productivity = output. Tech is both an output and input in the form of increased productivity onto itself. This means exponential growth. When we talk about cable companies merging, it is a merger of homogeneous entities, and in that only a merger of capital and labor. The argument here is tech companies "merging" with their own, heterogeneous technologies to yield even greater exponential growth. They are talking about ads and search and chrome "merging". Therefore the monopolistic consequences of tech is very different than that of commodities and utilities.
c) Tech is constantly innovating on new products and new variations of their products, which we can't grasp the effects of. It is easier to guess what happens to competition or how the end user suffers when other industries have bad actors. Can we tell with confidence what the effect of Youtube's, Twitter's, Reddit's recommendation algorithms is on our collective sense-making capabilities and functioning of the democracy? Can we tell if the thousands of A/B experiments being run on us is revealing how the products can deliver more value or how to exploit the users better? Are users aware that they are participating in the largest scale applied-psychology lab ever existed? This information asymmetry is again a part of the unique dynamics of the monopolistic machinery of tech.
When these three come together, the resulting monopolistic dynamics is unprecedented and incomparable to that of commodities, utilities and other old-school services, and we would be fools to make light of it.
Why not worry about both groups?
There are more major automakers who sell products in the US alone than there ever were baby bells. And there are a ton of regional competitors outside of the US.
You are absolutely right that ATT, Comcast etc. are the real monopolies that have been established with the help of government and they need to be broken.
I guess in 10 years they will do the same to Tesla, SpaceX.
This is an unprecedented amount of power over society wielded by corporations and, in effect, the handful of private citizens who own them.
I tend to lean libertarian but I've questioned for a while if it's appropriate and/or possible to limit this power in an equitable manner...but unchecked Google alone can probably sway elections with algorithmic manipulation of search results and even selective autocompletion.
That's probably the entire reason that the administration is targeting these orgs, and while I don't agree with the administration I believe this particular endeavor may be for the greater good. When Twitter can delete videos retweeted by the president, or add "fact check warnings" which effectively (though maybe not truthfully) discredit his statements, Jack Dorsey and his board are wielding a more direct, more immediate, and possibly more effective power than any of other branches of government.
Much better. I can phone up AT&T and complain to them when something goes wrong; they usually fix it.
Google will either ignore me or close my account (and all other accounts with associated Google-owned things)
Another data point that people stuck overseas because of Covid-19: Airlines banded in their oligopoly and divided up the world.
AA cancelled all flights but Europe, United in americas, Delta in Asia, etc.
Now if you want to fly from one of those places, you must get a mile voucher for your return flight, and re-purchase the exorbitant one way ticket from the one company from the oligopoly that got your current location to explore.
You're right we shouldn't be worried about them...we should be afraid of what has transpired these past 10-15 years because of them.
A common divergence tactic by those companies is to switch focus on the financial services/telcom, etc.
A key difference between those industries and FB, Google, and Amazon, is that they are under extreme regulations and oversight.
Google, et. al. are free to do whatever they and has resulted in billions in damages.
First - airlines, pharma, and financial services are nowhere near 'oligarchy' and don't come close to meeting the definition, just the opposite, they are very competitive.
With Telcos - the issue is real, but the drawback is mostly competitive innovation and price. Stagnant deployments and high prices would be the result. FYI - the US has decent broadband pricing. See: Canada!
Oil is a special one, but the industry is global and very competitive, especially in certain layers of that industry. Prices are widely known and understood. There is zero concern that 'some big entity' will control all of the oil, certainly not in America.
FB, Amazon, Google represent far more existentially problematic kinds of 'monopolies' because it bleeds into other aspects of life (social, media, information) and into other, adjacent industries. These are the real problem.
Search and social also have 'natural monopoly' kind of conditions which exacerbates the problems.
The other industry you didn't mention, wherein there is an existential problem with competition is 'health insurance'.
Punishing the best student in class only because he or she is the best is not cool at all.
Like what it did to Firefox?
Allowing that was probably a mistake. IDK if it's possible to undo, but letting the two biggest advertisers merge was is like almost definitionally anticompetitive.
Or just break up Google into two but let both of them keep the access to the same repo? Then what would this achieve?
It's generally acknowledged in technical circles that antitrust action is a highly effective way to break up a monorepo.
Splitting the datacenters might be trickier, but worst case, operate them jointly for 12-18 months, and at the end, each datacenter and the contents thereof are the exclusive property of one or the other. Or enact a third company to own and operate the datacenter under FRAND terms.
Well, that's Google's problem... Plus, it's not like they can't follow an API and versioned libs and have to have it all bundled...
I personally believe that we need to deal with those aggregators but not sure if this kind of breaking up will result anything other than lost opportunity costs from several years wasted from a lawsuit. I hope DoJ to develop a new effective framework to regulate aggregators but it's very unlikely since William Barr seems to be mostly driven by political motivation.
Disclosure: I do not own any stock in Google. I do own stock in Facebook and Amazon however.
1 - Search,
2 - Youtube,
3 - Gmail
The rest can go anywhere, as they don't seem to be powerful enough to control a market (although that may change in the future).
For Amazon, it seems clean to do it like this:
1 - AWS,
2 - Amazon (shopping website + logistics)
Audible & IMDB are nice, but to me not big enough to be trouble. Audible might be, but I don't know enough about that market.
Facebook seems straightforward:
1 - Facebook,
2 - Instagram,
3 - Whatsapp
Apple would be hard to break up, but allowing other stores on their devices might be all that's needed.
Microsoft seems to be under the radar compared to 20 years ago. Splitting Office and Windows seems less important to me now than it did back then.
> 1 - Search,
> 2 - Youtube,
> 3 - Gmail
And where does advertising go? I doubt any of those 3 are profitable on their own.
Plus, that allows YouTube to have its own advertising, or a third party advertising network.
What would you rather have, Amazon and Google, or Alibaba and Baidu?
Does this doctrine still hold given that many online business models put consumers and customers in different buckets? Most of Google's services are free for consumers, but customers are less fortunate.
As many have mentioned below, this will increase cost to consumers because there is an inherent connection between price and economies of scale. This is why so many startups (and their backers) are willing to lose money on every sale for the first decade to build dominance.
Now, if politicians are going to fight to raise prices for their constituents, they need a strong argument that will convince Joe Sixpack it needs to be done.
I challenge anyone here to describe the benefit for the average American in a politically feasible way (many of whom are struggling to pay bills, struggling to affordhealth care for their children, or dealing with drug addiction and racism, etc.)
Monopolies are "bad" because they have the pricing power gouge their customers at the expense of boosting profits. But Google's and Facebook's customers are advertisers! When you support "breaking up tech monopolies" you are basically saying programmers should get paid less money so advertising companies can buy cheaper ads. What an utterly ridiculous and self-destructive thing for tech workers to advocate.
I imagine it would be difficult to determine if this is happening, but it would seem logical to say that if this subsidization leads to an unfair advantage over competitors (who otherwise couldn't match the low price), it should be regulated, at least according to antitrust theory. The problem for Google is that this describes a solid chunk of their product portfolio.
My understanding is that a hypothetical breakup here wouldn't mean that YouTube and Gmail would have no ads. They would become clients of an independent "Google Adtech" company.
That certainly changes the economics of the business, but ad-supported Google services would be here to stay.
What would likely change is Alphabet would no longer profit from "Google Adtech's" ads on third party services.
The results almost seem better in many instances for what I am actually looking for. We are never going to say "Just DuckDuckGo go it" though. It sounds just so stupid.
Not at all?
> For those who are customers of AT&T - how do you like your service? Is it as good as Google?
Google's "support" for their products has one of the worst reputations.
Google's "support" for their products has one of the worst reputations.
Certainly, isn't all their censoring.. in fact, I am less concerned about it than other things.
If one party says that little green aliens are going to raise ATM fees and another party doesn’t, should google be obligated to return search results supporting both perspectives?
They are people and Google is still a corporation: they can all be bought, infiltrated, deceived, manipulated and threatened. I would not allow such a centralized point of failure for all information and knowledge to be controlled.
Given that not even soft sciences academics, who are supposed to be erudites, can separate themselves from their biases and look at things objectively, and their whole job is supposed to be that, I do not trust that the engineers at Google are able to do that.
And finally, simply giving an incredibly small elite what the rest of the population can see and know, is a bad idea.
These are the reasons why I oppose prioritizing "truth and accuracy". It would not be such thing.
I, personally, would add that just the two American political parties deciding what is politically neutral is pretty bad. Even if the Republicans are nominally on my side, I do not trust such people to treat fairly all other politics than the ones chosen by the leaders of each party. And all the other points I have raised wholly apply even to those on my side of politics.
It would still, however, be better than letting my political enemies controlling the internet. If the roles were reversed, you would think the same.
I genuinely believe that one of the biggest things harming American society right now is adtech. From social media to traditional media they have become obsessed with clicks and view time. This leads to negativity and extremism getting promoted and sensationalism overtaking authentic journalistic approaches. Not only that but it means a population that is getting constantly bombarded with terrible, often overinflated stories. Why? Because all this sells because the human brain is wired to focus on danger before all else.
China doesn’t have this same problem because it controls the media and censors social media. From a purely psychological standpoint this is a positive but there are obviously deep implications for what that censorship does to a society as well.
To answer your direct question, any losses by Google due to this will be dwarfed by the positive implications for the American society. I’m not saying this will fix the above problems but the amount of good it will do (in conjunction with other legislation especially, ie link tax and repealing section 230) is greater than the amount of bad by a mile.
And if you're one of those people who are worried that doing this would hurt innovation, don't be. The free market was what got us here, and regulators will ensure the market stays free so we keep moving forward.
Google is split into Google Ads and Google Data Collection. Search, Youtube, and all the other things they use to collect data on you will go to DC, and GA will just do ads.
DC will need to find a source of revenue, and will start bundling up selling the data they collect on you. One of their customers will be GA. But maybe some upstart company or Amazon or Microsoft will be their customers too.
GA will lose value because they will have to increase payouts/lower prices to compete with their new competitors. DC will go up in value because of all their new sources of revenue.
You'll be a shareholder in both and probably see your total value go up because Data Collection will probably make more money than Google Ads loses.
However, this will take years to litigate and a lot can happen to a tech company over that timeframe.
Biggest issue with Alphabet is that it is run like a govt bureaucracy. You have one business that is very valuable, and to own that you have to pay the tax of owning all the other stuff that does nothing but burn cash for the benefit of employees.
PS: I'd like to remain this discussion remain apolitical and have more rational discussions than folks leaning on either side.
Ads make sense in certain scenarios: for example, if I'm explicitly searching for a product I want. But in most cases it's just noise and it incentivizes the wrong behaviours.
I wonder if through the course of the investigation we finally get a definitive reason why Alphabet was created.
My gut tells me that it is to hide data sharing between entities.