In March 2021, at the height of the coronavirus pandemic, four of Europe's most powerful women sent a worrisome letter to Brussels
The pandemic had shown how much the E.U. depends on foreign technology, they wrote — and this needs to change. Their language was diplomatic — but the underlying message was clear; It's time to rein in Big Tech.
Tech giants will have to change the way they do business
Governments worldwide have set their eyes on the largest tech companies. But how did Big Tech come under so much fire? And how did it get so "Big" in the first place?
We might not always notice it — but technology is all around us. We use it to communicate, get information, and organize our lives. Private companies make most of that technology, which has given rise to an industry known as Big Tech. And within this industry, four companies have become especially powerful: Alphabet — which owns Google — Amazon, Facebook, and Apple. They're so big now they're known as the "Big Four," or by their acronym "GAFA." Although they run somewhat different businesses, what common is that they provide digital services —and they have become so ingrained in our lives that it's almost impossible to evade them.
For example, my phone by Apple and when I use it to surf the internet, that traffic likely runs through servers owned by Amazon. Or let's talk about you: There's a good chance you're (original video at the end) watching this video on YouTube, which Google owns. And you might have come across it on Facebook. The point is, Big Tech is everywhere. And this has made the companies very, very rich. While the coronavirus forced many businesses to down shutters and plunged the world economy into a recession, Big Tech reported enormous profits.
The stock prices of all Big Four have skyrocketed: Some, like Apple's, doubled in value since the beginning of the pandemic, but many would argue that this success comes with responsibility —and increasingly, people are asking if those companies are living up to that responsibility? No, and I don't think we should expect Big Tech to be benevolent. Have they been trying, but it's tough? The answer to that depends on where you are talking from; let's untangle this. The core criticism of Big Tech comes down to four points about how the companies;
Protect the privacy of their users
Can be held liable for what's happening on their platforms
Pay their taxes
How they treat their competitors
When it comes to the first point —privacy, Big Tech has been under fire for years. But it wasn't always that way. The birth of Big Tech dates back to the Silicon Valley of the late 1990s and early 2000s. Their missions were ambitious; The startups were out to disrupt the status quo, connect people and give them unprecedented access to information. A decade later, protests spread across the Arab world, and many saw that as proof of how the technology could, indeed, be a force for democracy, and it was. But what people didn't pay much attention to was how Big Tech makes money. Most of the companies got big by providing free services —while, in exchange, collecting data about their users and selling ads. And another couple of years later, the Cambridge Analytica scandal helped many understand that Big Tech could also use this same data to manipulate them. When reports emerged that a consultancy had mined information about millions of Facebook users to influence how they voted in the U.K.'s Brexit referendum and the 2016 U.S. election, it changed how people looked at Big Tech. Especially in the United States, I think, for a long time, it was considered a source of strength. But the idea that there could be groups inside the United States using these alleged champions to turn their pride into a vulnerability has hit home for a lot of Americans. Since then, stricter data protection laws have been passed around the world. The whole truth is that they haven't enforced these laws consistently. But increasingly, regulators and courts are doing just that — and that's one reason why Big Tech is feeling the heat.
The second point is that more attention is paid to liability — the question of who's responsible for what's being said or done on the platforms run by Big Tech. Supporters of U.S. President Trump have stormed the Capitol building to support his latest effort to overturn his election defeat. It's a question experts have been debating for years. But it only moved to the front pages when in January 2021, following online calls for violence, a mob stormed the U.S. Capitol. What happened on January 6 has mainstreamed this conversation. Still, we should note that even before the capitol storming, we were already talking about the liability of social media platforms when we spoke of Myanmar, for instance. Years earlier, nationalists in Myanmar had already used Facebook to incite violence against the country's Rohingya minority. Facebook didn't even notice that because they didn't have anyone speaking the local languages, and they didn't have anyone monitoring the situation in Myanmar. Big Tech has grown even faster than they could think about what kind of responsibility comes with that growth, which has been a problem. Facebook has acknowledged mistakes in Myanmar, hired more local language experts, and pledged to do better. But increasingly, governments say that such pledges alone aren't enough. Some, including Germany, have passed laws that force the platforms to take down incendiary posts or face hefty fines.
And speaking of money, there's a third reason why Big Tech is under fire; Taxes. For years, critics have said that the companies aren't paying their fair share of taxes. Both, when it comes to how much they're paying and where they're paying them. The problem here is that governments in the United States and Europe have given them a lot of space to go to the lowest point of taxes; to use the loopholes to deploy their armies of lawyers and accountants to place profits in other parts of the world and to move the accounting around. NGOs estimate that in 2020 alone, a group of 20 countries in the Global South missed out on almost 700 million Euro from Facebook and over 765 million Euro from Google's parent company Alphabet. Big Technology companies like Facebook, Google, and Amazon will soon be paying more taxes in France. Some countries have introduced national taxes to make the companies pay at least some taxes to use their services. But many believe that a global tax is needed. The Trump administration stalled international talks. The administration has now signaled willingness to come back to the table. Some hope for a deal by this summer. But that's far from certain. And taxes aside, some people also say the companies have become just too big.
Now the final issue; competition. Once again, it helps to go back in time. This man is John D. Rockefeller. Over a century ago, he was essentially what Jeff Bezos or Mark Zuckerberg is today. Rockefeller had built up an empire that controlled over 90 percent of the oil in the U.S. Which made him the richest man of his time. But people said he built his success on unfair practices. And in 1911, the U.S. Supreme Court ruled to split his corporation into 34 companies. You will fast forward by 110 years and hear people say similar things about Big Tech. In late 2020, U.S. Democrats said in a report that every one of the "Big Four" runs a monopoly, like the kind of monopolies we last saw in the era of oil barons.
Companies, they said, effectively have to sell their products on Amazon's marketplace because they have no "viable alternative." Apple, they added, gets to decide what software people use on their phones and charges "supra-competitive prices" to developers. Facebook bought up companies like Instagram and WhatsApp whenever they became severe competitors. And Google has favored its own services in its search engine and advertising business, the report said. The companies reject those claims; Amazon has dismissed them as "interventions in the free market." Apple says it does not overcharge developers. Facebook argues that regulators approved all its acquisitions. And Google says that unlike what the report claims, it still does have strong competitors. But this hasn't stopped the U.S. and other governments from launching antitrust cases against the companies. And some are even asking, what if we go back to what was done 110 years ago and break up Big Tech? Make no mistake; that would be incredibly difficult and messy, and it's utterly unclear if any break-up will happen, but the debate is gathering speed. I don't know to what extent it would solve all the problems we have with big tech. In some ways, breaking up a company is a remedy of last resort. It's a threat to our democracy if any single company has so much power. And we already see how much lobbying power they have and how much money they're spending trying to influence not just politics but NGOs and researchers. Around the world, Big Tech is spending more than ever on lobbying. According to the E.U.'s lobbying register, in Brussels, for example, the Big Four spent at least 15 million euros in 2020. They have their reasons; The bloc is working on landmark legislation to curb the market power of Big Tech and hold companies accountable for what's happening on their platforms. And it was against that backdrop,
Germany, Finland, Denmark, and Estonia sent their letter in March; "As Europeans, we aspire to continue asserting our democratic values and rules in the digital era," they wrote. And they concluded by calling Brussels to; "put the weight of the European Commission behind this joint endeavor." It was their way of saying; Time to get tough on Big Tech.
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