To tech’s critics, these definitional regularities point to something insidious, encapsulating in a word the dominance that each firm wields over its digital fief—some of it possibly ill-gotten. In December American trustbusters sued Facebook for alleged anticompetitive behaviour, and Chinese ones launched an investigation into Alibaba.
In recent weeks big tech has certainly seen more barbs than bonhomie. Facebook has run ads attacking Apple over new iPhone privacy settings that would ask users if they wanted to opt out of being tracked across other firms’ apps and websites—which, in Facebook’s telling, would hurt small businesses that need it to reach customers . For his part Tim Cook, Apple's boss, has been hinting that Facebook is playing fast and loose with users’ data.
In most markets, even where the incumbent’s share edged up, as it has in e-commerce and smartphones, the aggregate share of the next two biggest challengers rose faster . In six of the 11 areas the two runners-up now account for a third or more of the market, up from two areas in 2016. Stragglers outside the top three are being left in the dust.
The quintet’s senior executives and cleverest clogs also know and, recent sniping notwithstanding, mostly respect each other. When Satya Nadella took over as Microsoft’s chief executive in 2014, he binned a pro-privacy ad campaign alleging that Google scanned emails to serve targeted adverts. According to Microsoft insiders his friendships among Google engineers probably played a role in his decision. Mr Nadella also decided to stop trying to out-Google Google in search.
Many of these endeavours have yet to make much money. But the giants’ stratospheric stockmarket valuations—of between 25 and 82 times annual earnings—require ambitious growth plans. As their main businesses mature and slow, they must seek fresh sources of growth somewhere else. With trustbusters on high alert, snapping up startup rivals—or otherwise neutralising them—is getting harder, says a Silicon Valley venture capitalist.
Social media—Facebook’s bread and butter—are likewise in rivals’ sights. Last year Microsoft hoped to beef up its consumer business, which includes Surface tablets and the Xbox video-game console, by buying TikTok, a Chinese-owned short-video app. This year it considered acquiring Pinterest, a photo-sharing network. Neither deal came to pass, but it was a clear statement of Microsoft’s intent.
Unlike Amazon, which competes with Google head-on for advertising dollars, Apple seems unlikely to want to profit from search-advertising directly. Instead, its search project may be aimed at luring the privacy-conscious deeper into the safety of its “walled garden”—much to Mr Zuckerberg’s understandable chagrin.
Thanks to customer bases in the hundreds of millions or billions, technology platforms can diversify easily and cheaply. Facebook’s Marketplace, for one, started after the company spotted large numbers of people buying and selling various things in Facebook groups, notes Javier Olivan, who oversees the company’s core products.
Easy solution: Make social media the new public gathering of ideas. Then tax the ever loving fuck out of the tech giants. The end.
Tech giants' fiefs are no longer as safe as they used to be .