It's sad to see Google -- the once very promising small company with big ideas -- getting sucked into the vacuum.
The size of these vacuums is a direct result of policy. Tax policy, liability policy, antitrust policy -- there are a dozen levers we could pull to create a corporate landscape that looks very different. But yes, with the levers in their current positions, what we see here is inevitable.
Large businesses are the ones that tend to abuse their power, gather data inappropriately, promote monopolies, squash competitors using underhanded tactics, make inappropriate financial deals, lie to investors, and rent-seek at a grand scale -- in other words, all the anti-patterns of badly regulated capitalism.
And mom-and-pop businesses are totally capable of bad behavior and especially are worse to their employees! If they're too small to have HR departments they are perfectly capable of doing business based on personal grudges, wage theft, and accidentally doing things up to and including hiring slave labor.
> lie to investors
This one's funny because startup investors actually demand you lie to them (because they think it shows the right personality traits for a CEO, psychotic optimism), whereas large companies are public and the SEC will sue you if you lie in your investor reports.
Small companies require more overhead (per size) for compliance, yes, but they also have to compete with each other and they can't fight back nearly as effectively with lawyers and lobbyists.
> If you're a small company, that means you're not good enough
...at the game of monopoly, which is not a game any of us should be particularly invested in.
Though it's not the full Thiel monopolies are good philosophy. I merely think that large companies are not all monopolies, and that they can be monopsonies too, which can be good for consumers. (And they can also pay better and treat employees better than small companies because of the reasons I said above.)
> they can also pay better and treat employees better than small companies because of the reasons I said above
On the other side of every "easy dollar" is someone getting squeezed hard. Google employees and shareholders love the easy ad dollars, but everyone else pays through the nose for marketing. Apple employees and shareholders love the easy app store dollars, but independent devs and end customers get taken to the cleaners. Your ability to only see one side of this equation represents an extreme failure of imagination. We all pay a heavy price to keep things this way.
One common trend in evolution is toward gigantism in places of intense competition. Whales, for example, may be as large as they are to avoid having to compete or be eaten by smaller animals. Being bigger means they eat more, leaving fewer resources for competitors.
It can be quite the winning strategy.
At least so long as the environment can provide enough stability to feed such large organisms in the manner in which they are evolved to exploit.
For companies, being large means you can always buy the competition or make sure the barrier to entry is too high for competition (thinner profit margins, "free" services, regulatory capture, etc.).
It works, and quite well. These large corporations can withstand enormous financial shocks, and if they can't, they get purchased by those that can.
For most mature markets this generally seems to shake out to most of the product area being divided between two or three big players and a host of smaller companies at the edges.
Oddly enough, when things are stable being large may be a winning strategy, but it is also very fragile and if the whole system gets disrupted, can be the first to fail when things change too much.