"Rockefeller ran the company as its chairman, until his retirement in 1897. He remained the major shareholder, and in 1911, with the dissolution of the Standard Oil trust into 34 smaller companies, Rockefeller became the richest person in modern history, as the initial income of these individual enterprises proved to be much bigger than that of a single larger company."
It's true that once a company gets a lot of market power, either as a buyer or a seller, it causes problems. But by this logic, why not breakup Walmart first? There's lots of documentation on how they push supplier cost so low that suppliers are practically going out of business selling to WalMart. Google seems less problematic than lots of companies.
Age of Amazon is just a narrative which is no way to decide monopoly.
That's not all of retail. It's certain categories in retail. It's significant, but Amazon has a much broader selection of products and competes in far more sectors of the retail industry than Walmart does. Also, looking forward, over the next 10-20 years and given the changes in the marketplace, who do you think is best poised to dominate retail for the foreseeable future: Walmart or Amazon?
https://blog.pipecandy.com/walmart-market-share-story/
As Peter Thiel said in Zero to One, monopolies seek to define their sectors in the broadest terms possible in order to avoid being classified as such.
Yes, and it's not a secret that the other way to unleash value is to merge companies. See for example AT&T or Exxon & Mobil.
The same does not seem to be true for any of the Alphabet companies, except in the sense of being able to leverage shared user data for better targeted ads. Perhaps that does make it worth it to remain one company, but it's debatable, especially for something like Waymo which likely won't benefit from having access to search data.
This goes all the way back to the most basic theories of organization - why do companies even exist? Why is everyone not effectively a contractor? Why do companies not outsource every non-core function? And there are good reasons why companies exist - see https://en.wikipedia.org/wiki/Theory_of_the_firm External transaction costs are real and breaking Google up could significantly increase those.
Someone from Siemens once told me "Siemens is an investment bank that happens to own all of the companies it has invested in." I'm not sure whether that's true or not, but it's a good description of conglomerates in general.
All conglomerates are like this, the clearest example is Berkshire Hathaway.
Maybe you could ask from the opposite perspective, why aren't all mutual funds organized like BRK?
Others might say a better justification was the cheap corporate credit available to some (but not all) firms, and thus the competitive advantage of conglomerates was access to credit, rather than management. The smaller firms and individuals did not have the same access to credit.
But in the 80s, the pendulum began to swing the other way. The problem from the perspective of the credit markets -- whether shareholders or bondholders -- was the difficulty in obtaining detailed operational information from these large conglomerates. They became very opaque, as they could use the losses of one firm to subsidize another, and it was hard to drill down and figure out what was happening by looking at the financial statements. So then began a wave of slicing these companies up and selling off the pieces.
Or from a completely different perspective, it was the extension of new types of credit such as junk bonds that allowed insiders to do leveraged buyouts, which tipped the scales away from the conglomerates and led to a lot of asset sales that "unlocked value" while other operations were shutdown.
Not saying who is right, just offering some perspective that these arguments have been engaged with 60 years ago, and ended up with mixed results.
There is one profitable part (ads). The other parts are supported by that part or at least require deep integration with that part.
Maybe you could split of Google Cloud, but I bet it would just become a digital REIT.
Google (Search), YouTube, Doubleclick (Ads), Android (Android, gmail, docs, google drive, Meet, google cloud, Stadia), maps and business listings (a Yelp competitor).
I don't think Google Cloud should be its own thing. I see the business software, Android, Stadia and Google Cloud all part of the same company. It's basically a Microsoft clone. I could even see Microsoft buying that part of the business from Google.
Who knows, this might even make Google more competitive at the end of the day. If anything, it could make the "ROI" and financial metrics of their individual products more explicit instead of nebulous "cross-subsidizing" centers.
Yes you can.
> most of the other facets would likely tank within 18 months without (specifically, the ones dependent on ad revenue to remain solvent).
Business models don't have a right to exist just because they "work" for the moment.
> You'd have breakup the ads business and give a piece to various resulting companies, otherwise most offshoots wouldn't have a viable positive revenue model to save themselves from immediate financial collapse.
I think there's an argument to be made that anything that "must" exist could be paid for by taxes (and likewise open sourced and publicly owned). However, I honestly don't see much of Google's business model that "must" exist. Not Gmail, not Meet, and certainly not Ads. Possibly Chrome.
No. I want the government to step in and break up Google into distinct business units. That doesn't mean outlawing Google at all.
Besides. They. Dont. Pay. Taxes. In. The. Country. They. Claim. To. Be. Protecting.
Besides being an incredibly annoying way to state your point (leave the hand-claps on Twitter, please), note that their very highly paid employees pay a ton of tax.
Abolishing the corporate income tax entirely is something I'm in favor of and it has its proponents across the political spectrum:
https://www.milkenreview.org/articles/the-progressive-case-f...
If size was the only thing that mattered you'd never see small companies beat big companies, in countries or across them. This is generally not the case. Healthy ecosystems seem to be more important long term than short-term dominance.