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Breaking Up Amazon, Google, Apple, and Facebook Could Save Capitalism, NYU Professor Says (venturebeat.com) 237

An anonymous reader shares a VentureBeat report: If you want to get an idea of how quickly sentiment has shifted against U.S. tech giants, just listen to NYU professor Scott Galloway. [...] "After spending the majority of the last two years of my life really trying to understand them and the relationship of the ecosystem, I've become 100 percent convinced that it's time to break these companies up." It's an audacious claim from anyone, even more startling coming from someone who has been such a close and bullish observer of these tech giants. Yet for Galloway, it is clear that the four companies have simply become too big, and too powerful. "The premise of my book is that Amazon, Apple, Facebook, and Google are our new gods, our new source of love, our consumptive gods," he said. "And as a result of their ability to tap into these very basic instincts, they've aggregated more market cap than the majority of nation's GDP ... I think these entities are more powerful than any entity, with maybe the exception of China and the U.S."

[...] Galloway said he wasn't making his argument based on many of the current emotional outcries against the companies, though these are important to note. And he proceeded to list what he considers to be these giants' numerous sins. "There are reasons to be angry at them," he said. "They basically power fake news ... So the notion that our platforms have been weaponized by the intelligence unit of a foreign adversary was initially responded to by Facebook as crazy, that we were crazy for thinking that. Then we found out it was millions of people, and now we're finding out it was hundreds of millions of people who were exposed."

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Breaking Up Amazon, Google, Apple, and Facebook Could Save Capitalism, NYU Professor Says

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  • Why is this here? (Score:5, Insightful)

    by xvan ( 2935999 ) on Friday January 26, 2018 @01:24PM (#56008471)

    Breaking up Amazon, Google, Apple, and Facebook could save capitalism

    Says Scott Galloway, NYU marketing profressor

    • by MitchDev ( 2526834 ) on Friday January 26, 2018 @01:26PM (#56008505)

      Don't forget to break up ALL the Banks, Wall Street corporations, Walmart, Comcast, Time Warner, DISNEY, the much consolidated airlines, etc etc etc while you are at it.

      • by macsimcon ( 682390 ) on Friday January 26, 2018 @01:58PM (#56008859)

        Banks are a systemic threat to the economy. The top four (or is it five?) banks are now so large that the failure of any one of them could destroy the country.

        But there is another way: every state could charter its own bank, just like North Dakota has. With that much competition, fees would fall, the big banks would lose marketshare, and shrink to a size which didn't threaten the country with their failure.

      • Yes, this. But don't stop there. All large companies. Then legislate how large companies can get. And do not allow companies to own other companies. BTW, fuck Ajit Pai
      • by atrex ( 4811433 )
        Yeah, if they're going to break up some big companies they need to break up ALL big companies. Otherwise they're just picking apart the newer tech giants so that the older companies can swoop in and take over.

        And don't forget AT&T and Verizon.
      • by Rob Y. ( 110975 )

        It's interesting that Microsoft isn't mentioned in your list. Have they become that irrelevant? Or have they just managed to slip just far enough below the radar to continue their monopolistic practices in areas nobody's looking at any more?

        • Just forgot about them, they are evil but they have kinda slipped in "name recognition". Plus, I take it you missed the sarcasm

        • The big diffrence is that MS isn't heavy into the media business.

          Technology may generate pots of money, but influencing the minds behind the eyeballs gives you POWER.

    • Re: (Score:2, Offtopic)

      by HornWumpus ( 783565 )

      msmash should post at -1. Story is obvious troll.

      • Wait...Msmash is an EDITOR!? I do not think that word means what you think it means. I'd rather say (he/she/it/whatever) is a confused marketing activist. Or an activist marketer. What were we talking about?
    • by ph1ll ( 587130 )

      Yes, indeed, he is a professor of marketing [nyu.edu] and this is great marketing for his career! (Expect a forthcoming book by Fall).

      Meanwhile, the rest of the world will leave such matters to the professors of law where they belong.

      • Yes because otherwise marketing specialists are struggling out there, I'm sure.
      • by ph0rk ( 118461 )
        I'd think you'd want an economist if you were interested in what might happen with the economy after an anti-trust intervention, not a lawyer.
  • No-brainer? (Score:5, Insightful)

    by Rick Schumann ( 4662797 ) on Friday January 26, 2018 @01:33PM (#56008601) Journal
    Last time I checked, aren't monopolies bad for capitalism, and by extension, bad for a national economy in general? Am I right? All the above-named corporations have de-facto monopolies. Add Microsoft and AT&T to that list, by the way, just for starters; there are many others, too.

    While we're at it, how about we repeal the decision to consider corporations to be 'people' in the eyes of the law, and also ban them from contributing to political campaigns. In fact, I'd prefer that all campaign funds come from a neutral source, so no corporations or rich individuals can influence politics.
    • Re:No-brainer? (Score:4, Informative)

      by colonslash ( 544210 ) on Friday January 26, 2018 @01:48PM (#56008755)

      > aren't monopolies bad for capitalism, and by extension, bad for a national economy in general?

      No, abuse of monopoly power is bad for capitalism. Monopolies are often useful for supplying a service that wouldn't be supplied otherwise, usually because of high barriers to entry.

      > All the above-named corporations have de-facto monopolies

      Why, because they're big? What is Apple monopolizing? Phones? No. Computers? No. For Google, Bing is a large competitor, and there are other search engines people could switch to the very next time they search. Walmart is a decent competitor for Amazon. Facebook - Google+, SnapChat, WhatsApp, etc. I don't see how any of these companies have exclusive control to anything.

      • by xvan ( 2935999 )
        WhatsApp is facebook's. Your point still stands.
      • Maybe Monopoly is not the right word, cartel might be a better one. As you can use any one of a number of messaging apps, social media portals, etc, but they're all the same.

    • Add in some fixes to the income gap as well. CEO's in Sweden [reuters.com] only make low 7 digits, any more and they are criticized. Stateside, many CEO's make 8 and 9 digit salaries [aflcio.org]. Not to mention stock options and other nonsense they get. I'd love to see a law that states "A CEO cannot earn more than n times his/her employees average salary". Even better if 'n' were 15, and instead of average it were lowest salary. Give the low-level worker bees a living wage and invest that CEO wallet padding into productivity somew

    • by Whibla ( 210729 )

      Last time I checked, aren't monopolies bad for capitalism...?

      Actually monopolies are the logical end-point of capitalism. Without regulation, and given enough time, there would only be a monopoly company masquerading as a competing duopoly.

      I believe a similar logical outcome is evident in politics, where it's a mathematical 'certainty' that any democracy will end up in a two party state.

      While we're at it, how about we repeal the decision to consider corporations to be 'people' in the eyes of the law, and also ban them from contributing to political campaigns

      Totally with you on this, although I'm not completely sure how such a ban could ever be implemented, given how subjective such a topic would be (after all, when a newspaper, owned by

    • Yes, Rick, you are right. Would you please check out the pod for me?
  • by Anonymous Coward on Friday January 26, 2018 @01:34PM (#56008613)

    It's funny that he didn't mention Bank of America, Wells Fargo, JP Morgan Chase, Goldman Sachs,.....you know, the banks that fucked up the economy and then got a big government handout for their illegal actions.

    You want save capitalism, break them up and jail their bosses.

  • by substance2003 ( 665358 ) on Friday January 26, 2018 @01:35PM (#56008623)
    I think the problem with breaking up these companies is that it doesn't resolve the fundamentals that permitted them to come into being in the 1st place.
    Breaking them up just means that it will happen again in the future unless we change was made it possible to begin with.
    • by PPH ( 736903 )

      doesn't resolve the fundamentals that permitted them to come into being in the 1st place.

      Preferential tax treatment for mergers and acquisitions.

      • by lgw ( 121541 )

        Notice MS isn't on that list. These companies mostly grew organically - Google's probably acquired the most, but to small effect. Amazon's largest acquisition was the company that made robots for their warehouses (and had no other customers). I don't think there's an M&A theme for why these particular companies are so large.

    • by lgw ( 121541 )

      I don't see the problem with these companies being large: the only company on that list that seems to have an effective monopoly is Facebook (though I guess Google is close), and that's just the nature of social networks - everyone wants to be on the same one. In any case these near-monopolies seem to be the result of customer choice. Most phones aren't iPhones, and in retail Walmart has 3x the revenue of Amazon, so I don't see any sort of issue there.

  • by david.emery ( 127135 ) on Friday January 26, 2018 @01:37PM (#56008637)

    At least not in the article (I didn't watch the video). These companies are not the same. Facebook controls 'views' and advertising. Google controls 'search' and advertising, but of course there are alternatives for search. Amazon controls sales and delivery. Apple provides widely used, but not dominant, phones and computers.

    Trying to make an argument that they're collectively the same is flat-assed wrong. And size itself is not a sufficient justification for government intervention.

    Amazon, Google and Facebook arguably have potential monopolies in their markets, but each does have competitors. Apple clearly has viable competitors in each of its markets.

    But hey, this guy gets to go around making bogus arguments, and probably collects nice speaking fees as well as a lot of clicks and publicity.

    • The other thing thats a problem is actually defining "Monopoly". People throw that term around left and right without context. There is legal "monopoly" as in anti-trust, there is market monopoly which is more of a statement about market power, etc.
  • Translation (Score:4, Insightful)

    by lucasnate1 ( 4682951 ) on Friday January 26, 2018 @01:40PM (#56008685)

    Capitalism needs socialism in order to avoid becoming like Somalia. The same is probably true in the other direction as well. Too bad that people that think that radicalized version of these two are silver bullets that solve everything.

  • wrong target (Score:5, Insightful)

    by swell ( 195815 ) <jabberwock.poetic@com> on Friday January 26, 2018 @01:44PM (#56008721)

    If you want to break stuff up start with oil companies and banks- companies 'too big to fail' that have already failed and become even bigger. These companies crush innovation, control our elected officials and pretty much run the world as they please.

  • by jenningsthecat ( 1525947 ) on Friday January 26, 2018 @01:45PM (#56008725)

    then by definition you are destroying capitalism, not saving it. Not that I think that's a bad thing - it's simply important to replace capitalism with something better, not the something-worse represented by the companies in question.

    I also find it interesting that Galloway decries the "new gods", yet seems totally unaware that they are the logical and inevitable outcome of capitalism. Also, the irony that he himself worships the "old god" called Capitalism seems totally lost on him.

  • Apple has a smaller share of the smartphone market than Android. Has Google prevented anyone from coming up with a superior search technology? Is Google forcing Mozilla or Apple to make Google the default search engine? Google is capturing everything it can about all of us, but have they ever sold that information, or let it loose through negligence? I can think of several government agencies which have compromised private data more than Google ever has.

    Facebook might be another story. They've lied repeated

    • So Google is the only one I have an answer for, but after that, I still don't know how you'd break them up.

      The problem with Google is network effects: Google's product gets better the more people use it, because fundamentally, their product is based on data. So the more you use it and find things, the more you reinforce their search algorithms, which means that searches are better. So you keep coming back and using their search engine because it gives the best results, and so the cycle goes. These compoundi

    • Obviously when I replied, I was more responding to "Has Google prevented anyone from coming up with a superior search technology?" than "What laws have they broken?"

      On that question, the answer is obviously: nothing that would deserve anti-trust scrutiny.

    • Apple has a smaller share of the smartphone market than Android
      Never heard about a company called "Android".

      Your sentence makes as much sense as "Porsche has a smaller share of the cars market than all other luxury car makers together"

      I hope you don't invest your money on the stock market with such brain dead thoughts.

      • I would worry more about how your rigid pedantry doesn't allow you to glean meaning from sentences that are sufficiently correct. You know perfectly well what they were saying and why that's a relevant metric in the smartphone market. The fact that Apple has a monopoly on iOS devices is a meaningless tautology, and comparing iOS' market share to that of Android is the only meaningful metric when talking about an anti-trust action that might be taken against Apple. They simply don't hold enough of the smartp

    • They intentionally lose money, and they use their market clout to enter new markets and drive existing competition under so they can capture marketshare, and so we assume they will raise prices once the competition is gone.

      I keep hearing that, but the assumed last step never seems to happen.

  • If you break them up then they can be replaced by Huawei, Samsung, Tencent, and Baidu.
    Is that a better outcome?

  • by rsilvergun ( 571051 ) on Friday January 26, 2018 @01:52PM (#56008807)
    and telecom (anyone remember the John Oliver bit where he showed AT&T had bought up all the Bells they'd been forced to break off from?).

    All I can say is good luck. You're trying to fix something that's fundamentally broken. It didn't work when we did it to AT&T. Better to regulate and live with the reality of mega-corps than to pretend you can break up these kinds of large power structures.
    • Airlines are somewhat natural monopolies, like chip manufacturers. To some extent, for a given area, a telecom is a natural monopoly, much like an electric utility. For electric utilities, the maintenance of the grid and the production of power should be separate functions; perhaps telecom could be handled in the same way: have one company maintain the "last mile", and let any company that wants plug into it... but that would require Net Neutrality, wouldn't it?
      • When airports do a shitty job and end up with anywhere close to a monopoly airline, ticket prices go crazy and service goes to shit. I'm thinking of MSP.

        For electric generation, local distribution is a natural monopoly, there can only be one control center so Independent system operator (ISO). All the other functions (generation, interconnect) are best run as a competitive market.

        Sure you get situations like PG&E 'owning' the bay area because they own the links. The fix for that is more transmissio

  • Capitalism cannot be saved any more than a tadpole can be saved after it has turned into a frog. What we have today in the US doesn't resemble capitalism. We have a crony corporatism on meth. It's what capitalism looks like when it metastasizes.

    This was all predicted, by the way, by a little-known 19th century German economist named, Karl Marx.

    • Bullshit. Not what Marx predicted. Marx said capitalism would die due to zero profit margins. He was wrong in just about every prediction.

      There isn't capitalism, at all, in industries like banking.

      What we have in our non-capitalist system elements is closer to Marx's solution than Smiths. Which is why it sucks so bad.

      • Bullshit. Not what Marx predicted. Marx said capitalism would die due to zero profit margins. He was wrong in just about every prediction.

        I don't know where you're pulling that from, but there are five specific areas in which Mark perfectly predicted the current late-stage capitalist cancer.

        1) Imaginary appetites (see, iPhone X and just about every advertisement)

        2) Capitalism's Chaotic Nature (see: the Great Recession of 2008 and the increasing economic inequality and resulting social disruption. It's ca

  • I've argued in the past that Microsoft would be worth more as separate companies. At least separate the OS company from the Apps company, so they are free to make competitive apps on Linux and Mac. (Yes, they already port Office to Mac). As for as XBox, the convergence between Windows and XBox is probably a good thing; I look forward to Windows PCs and XBox consoles becoming indistinguishable, and to being able to play XBox games wieh a gaming mouse and keyboard.
  • by 140Mandak262Jamuna ( 970587 ) on Friday January 26, 2018 @02:08PM (#56008973) Journal
    Trust buster Teddy Roosevelt cracked down on American monopolies when it was difficult for foreign companies to break into American markets.

    Now we are in a totally different era. It is extremely difficult for any foreigner is just move in and live in the USA, legally. Even illegally one risks life, limb and liberty to move in here.

    On the other hand, any Tom, Dick or Harry, of Ching Ling or Ramanathan Murugappa or Aziz al-Burkati or Omonomo Boborossa can set up a company and do business in America. We break up our monopolies, we still be under monopolies, except this time the monopolies are based in foreign countries.

    They are the only ones who can keep foreign monopolies at bay. We should find ways to tame them, contain them but not cripple them so much foreign companies come and take our market.

    • It doesn't seem like you are really objecting to "foreign monopolies" but really any foreign company doing business here at all. That seems reasonable at first until you realize that there really is no such thing as a foreign company anymore. What makes them foreign? Their shares are listed on the Hong Kong stock exchange even if 80% of the stock holders are in the US? What about if they are listed on NYSE but have mostly foreign ownership?
  • Automation, post-scarcity effects, and a finite world put a hard limit on its lifespan as a system that could hope to serve a majority of humanity.

  • by bickerdyke ( 670000 ) on Friday January 26, 2018 @02:15PM (#56009045)

    I agree that almost-monopolies are not good because of reasons, but why these?

    I think it's much worse that one single company is controlling half of the worlds beer market or that companies like Nestle have the food market cornered. And even if we restrict us to tech companies: Has the Microspft OS monopoly changed since everyone was concerned about that?

  • Apple, Google, and Amazon all have multiple products and divisions that can easily be broken off and split into separate entities.

    But Facebook is still just Facebook, you can't break it up without major changes to the product itself.

    • You can break up all of those companies, but virtually none in any way that's meaningful.

      Break Google search off from Alphabet, and you're left with a giant search company that still makes money hand over fist, and a bunch of stuff that can't be funded.

      Break Amazon up so that you have the Internet's online store, and a cloud service that definitely makes money, but doesn't impact the dominance of EITHER.

      Break up Apple so that you've got an OS Apple and a Hardware Apple and now you have a significantly dimin

  • So because these companies are so large they allow fake news to control the population?

    Where is the data that shows the fake news actually impacted anything?

    This idea that a bunch of trolls can target a population and sway their ideas assumes people are really dumb animals.

    Are we not better than that? Can we not think for ourselves? Or have we dumbed down our schools and failed to teach critical thinking to the masses?

    If that is the case we are lost already and breaking up corporations because the
  • "they've aggregated more market cap than the majority of nation's GDP"
    - This seems like either a misplaced apostrophe or a math fail. US GDP is something like 4 times their combined market caps.

  • Let's break up the jumbo eternal company... you know companies like Amazon, because they were never a startup.

    Sheesh... professor of what?

    The fact that those big companies didn't exist and now exist prove the "professor" wrong. He's wrong about what he said, and I don't think he understands capitalism at all. What is he teaching???

    gods? Really? Amazed. People will ditch these "gods" (I even hate to use his word here) for new "gods", they always do... oddly enough, that's closer to capitalism, w
  • This is completely silly. How many times do we need to stand at this point of history? Haven't we been here before? Several times?

    Stop trying to address the symptoms of our broken system, and fix the system itself so this stops being a problem we face again and again.

    If you want monopolies to not be a thing, then you need to change a lot more than just busting up monopolies as they inevitably pop up again and again.

    This is reaching into the insanity regions of stupid. Doing the same thing over and over

  • Pretty sure banks and Wallstreet are causing more damage than the companies listed in TFA,
  • Capitalism was never meant to be a vehicle for companies to become this big and powerful. Government intervention does that. Capitalism actually requires companies to find it too hard to continue and break up before they get that big. Of course this doesn't work for any corporate board member or executive, so they get all the protection they ask for.
  • by Baron_Yam ( 643147 ) on Friday January 26, 2018 @02:54PM (#56009381)

    Determine what a safe market share is, set an exponential growth in corporate tax by percentage over that share.

    Determine which goods and services are best considered 'infrastructure' where competition is counter-productive, and have the government take them over - ideally while farming out the actual work to contractors in accordance with the first rule.

    Now look at Google, Facebook, Twitter, etc... how do you break up such things when the whole point of them is that they provide a single interface? Consider search and social media (over a certain market share) to be infrastructure, nationalize it, and have a government central interface that combines regional providers. And deal with the idea that instead of a corporation deciding what is acceptable to do with your personal information, you now have a government making those decisions.

    I'd argue that chopping companies up will reduce their influence on government, and remind the government that their 'shareholders' are voting citizens, and that ultimately so long as you don't elect a tyrant you'll be better off.

  • Let's break up China and the US too.

    Ridiculous.

  • There was huge oppostion to doing this to Microsoft 20 years ago and not doing it didnâ(TM)t work out well for the public interest or Microsoft. I suspect that similar results will happen with these companies. Theyâ(TM)ll collapse from the inside, much like Microsoft did from a combination of no vision and no hubris.
  • Best goddamn book review platform (/.) for an author - everrrr.
    Nothing more, keep moving.

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