13 ms·

Tech’s ruling class casts a big shadow

124 points by hollaur 10y ago

friedman23 10y ago
I don't think you can consider 5 companies to be an oligopoly especially when you don't see monopolistic practices. These companies regularly undercut each other and innovate.
- tabeth 10y ago
  I find this kind of learned helplessness to be fascinating. Do you think big companies need apologists? Do you think there would be more or less innovation with more smaller firms?
  - cylinder 10y ago
    Reminds me of when people were fine with erosion of civil liberties, expansion of surveillance, etc, under Obama because they trusted him and thought he was decent, and that they could probably trust future Presidents with that power too. Here, they find the current crop of leaders at these companies decent enough, not realizing their control and leadership will change over time.
  - friedman23 10y ago
    Helplessness? Apologist? I don't consider Google/Facebook/etc my enemy like you seem to. These companies are not exploiting me, I have no reason to be hostile to them (profit is not exploitation). > Do you think there would be more or less innovation with more smaller firms? Likely less, I do not think that private space exploration or self driving cars would be possible without the massive accumulation of capital enabled by tech giants. Now let's look at the counterfactual, the US has massive tech giants and the majority innovation comes from or to the US. Other countries don't, other countries don't have nearly as much innovation bar a few exceptions. And truthfully, I find people that are anti capitalism to be far more interesting. It's amazing that people can convince themselves that private ownership is wrong while living in the most prosperous time in history and also believing that stripping those better off of their wealth will somehow lead to a more prosperous society when every time it has been done it has lead to disaster.
    - Method-X 10y ago
      Great post. You would really like Peter Thiel (read Zero To One).
    - majewsky 10y ago
      > I do not think that [...] self driving cars would be possible without the massive accumulation of capital enabled by tech giants Yet people are building self-driving cars as a hobby project. Sure, the whole topic would not progress that fast, but that statement is a bit overblown. (Same for private space exploration to a much more limited extent.)
      - taneq 10y ago
        People are building toy systems that work in limited scenarios, not putting in the hard engineering work to build robust, generally applicable systems. (Unless there's some significant hobbyist self-driving system I don't know about? The closest thing I can think of was comma.ai and that was barely at the "won't drive off a fairly straight highway, probably" stage.)
        tomhoward 10y ago
        People are building toy systems that work in limited scenarios, not putting in the hard engineering work to build robust, generally applicable systems Also, they're building these systems using tech that has been developed and open-sourced by the big players.
    - sharemywin 10y ago
      It's funny you make it sound sound like Darpa had no part in self driving cars. or that the government space program didn't set the standard and the foundation for private space exploration. Yes Capitalism and Liberal Democracy is the most powerful system man has ever created. Hopefully we don't screw it up by giving all the credit to the guy handing you the apple from the orchard we call the "western world" Football is an awesome game but without the guys in the black and white uniforms it would be nothing but chaos.
- aaron-lebo 10y ago
  Except when they collude: https://www.theguardian.com/technology/2014/apr/24/apple-google-settle-antitrust-lawsuit-hiring-collusion https://www.theguardian.com/technology/2014/apr/24/apple-goo... and collude: https://www.theguardian.com/technology/2016/mar/07/apple-450-million-settlement-e-book-price-fixing-supreme-court https://www.theguardian.com/technology/2016/mar/07/apple-450... ...and collude: http://www.billboard.com/articles/news/6590827/apple-music-major-labels-investigated-collusion http://www.billboard.com/articles/news/6590827/apple-music-m...
  - friedman23 10y ago
    Yes, and it's illegal. Having a monopoly isn't illegal. Anyway, your statement is completely unrelated to the subject of whether these companies would be innovating more if the market was less consolidated and I don't believe so.
    - aaron-lebo 10y ago
      Some kinds of monopoly are illegal. That first case was an antitrust case which has some connection to anti-monopoly, yeah? Those companies have had a decade at the top with all the money and talent in the world. Has tech gotten that much better since 2007? Has Apple's hardware gotten better relative to the competition? Has your web experience gotten remarkably better? Do we prefer Allo or Hangouts or x, y, or z to Google Talk? With the clout they have you have to innovate some and they certainly have. The question is whether they have innovated substantially. It doesn't seem like it.
      - friedman23 10y ago
        > Has tech gotten that much better since 2007? Yes > Apple's hardware gotten better relative to the competition? "Relative", explain why you put that qualifier please beyond not having an argument. Also yes. > Has your web experience gotten remarkably better? Yes > Do we prefer Allo or Hangouts or x, y, or z to Google Talk? Hangouts, what's your point here? You really don't remember what tech was like 10 years ago.
Apocryphon 10y ago
It's quite interesting to speculate who would be the sixth empire. Based on their attempts to dip their fingers into as many pies as possible, I'd say Uber is a would-be contender, and the platform they've been trying to own is the real world. As far as on-demand service economy startups go, they're certainly preeminent.
- otalp 10y ago
  I'd say Snap is more likely if they expand beyond their app.
  - Method-X 10y ago
    Not a chance. Expand where?
    - k-mcgrady 10y ago
      Wearables (already started with Spectacles), drones (supposedly already working on that and close to launch). Those could lead to many other things (Snap OS for the wearables, fitness stuff in the wearables, Youtube competitor with drone videos etc).
      - simonh 10y ago
        All of which anyone else could do, and many companies already are. Meanwhile Snap is burning huge quantities of money faster than ever on seriously unprofitable core businesses. It's own investors prospectus says it "may never achieve or maintain profitability,". Good luck with that.
- empath75 10y ago
  Verizon just bought aol and yahoo and are looking for more companies to buy.
  - Bartweiss 10y ago
    Verizon seems like a strong contender. They're well placed to follow the Gang's general model of using a profitable near-monopoly business to enable lots speculative purchases and projects. (Amazon: AWS and sales, Google: search/ads, Apple: hardware, Facebook: FB and Instagram) If we're going to see a sixth player, it will be someone who can get massive, hard-to-threaten control over some major part of the web ecosystem. Data access sounds like a winner to me, especially if net neutrality crumbles.
epberry 10y ago
I'm not sure what the point of this piece is. There is fierce competition between these five and consumers are better for it. I think you can look at the cloud war between Google, Amazon, and Microsoft as a great example of competition among these companies producing better technology and lower prices. If there was collusion, we would see cloud costs and technology stagnate like cars from Detroit in the 70s and 80s. Instead the opposite is happening.
- Apocryphon 10y ago
  I guess the natural question is whether or not having markets be owned by a small number of companies prevents new entrants from competing successfully. I leave that point to be debated by others. On a different note, it's interesting how the presence of the giants affects the startup world. I am reminded of a passage from No Exit by Gideon Lewis-Kraus [0]: 'All the while, Martino’s ultimate warning—that they might someday regret actually getting the money they wanted—would still hang over these two young men, inherent to a system designed to turn strivers into subcontractors. Instead of what you want to build—the consumer-facing, world-remaking thing—almost invariably you are pushed to build a small piece of technology that somebody with a lot of money wants built cheaply. As the engineer and writer Alex Payne put it, these startups represent “the field offices of a large distributed workforce assembled by venture capitalists and their associate institutions,” doing low-overhead, low-risk R&D for five corporate giants. In such a system, the real disillusionment isn’t the discovery that you’re unlikely to become a billionaire; it’s the realization that your feeling of autonomy is a fantasy, and that the vast majority of you have been set up to fail by design.' [0] https://news.ycombinator.com/item?id=7643902 https://news.ycombinator.com/item?id=7643902
  - friedman23 10y ago
    What is your definition of successful? Is it becoming a tech giant, is it being acquired for a billion dollars by a tech giant, or is it being a small profitable company that fills a certain niche and never expands beyond it?
    - 10y ago
handsomechad 10y ago
After reading the article I tried to think of all of the ways which I interact with the "gang of five" and quantify their importance in my life. Apple - I'm writing this on a brand new Macbook Pro, and my iPhone is sitting right next to me. I have a $5/month subscription to Apple Music. It would be painful, but with a gun to my head I could easily switch to Windows, Android, and Spotify. Google - I'm browsing HN in Chrome, by far my favorite browser. I use google search dozens of times throughout the day to figure things out, it's truly an extension of my brain. I could switch to a new browser, but I haven't tried Bing enough recently to know if it would compare to Google. Amazon - I have a Prime membership, but I'm only a sporadic online shopper. That said, the Amazon shopping experience has provided me with a lot of value. No real alternatives here. Facebook - I don't use Instagram, I don't use WhatsApp, I do have a Facebook but I don't use my real name and I have very few friends. I use the News Feed Eradicator extension to get rid of the Trending section and the News Feed. Of all of the companies, I consider Facebook the most dispensable from a personal perspective . The only features I regularly use are Chat, which is functionality that existed long before Facebook, and sometimes stalking people that I just met to see more pictures and get a "life resume" on them, which is a habit that I would rather not be able to indulge in to be quite honest. Microsoft - My work computer runs on Windows, I use Office 365 at work, and of course tons of companies that I rely on in my consumption supply chain and infrastructure are dependent on Microsoft in some form or the other. I'm truly shocked at Facebook's ascendance to the tech stratosphere. Obviously the numbers don't lie, but Facebook just seems like it has so much lower utility than all of the other companies mentioned here. Yes, it's younger and in a newer category, but all of the other companies provide fundamental building blocks to the modern technological experience. Social media seems so much more superfluous by comparison.
- jefe_ 10y ago
  Facebook with Whats App has the strongest penetration in developing countries of all companies listed. Many of these places have large, young populations. I would be curious to know how many people exist in Facebook DBs but not the DBs of their own government. This is where I see Facebook value.
- vincentleeuwen 10y ago
thomasthomas 10y ago
Funny how amazon gets thrown in with facebook under the 'consumer tech industry' moniker. facebook sells ads to make money. amazon sells physical stuff. how are they related besides both using technology? I think we should group businesses by how they make money and who they compete against. 'technology company' doesn't mean anything in a world where every company has technology.
- golemotron 10y ago
  Google is a technology company that sells ads. Amazon is a technology company that sells goods. It's not what you have, it's what you are. The future isn't bright for companies that just "have" technology.
  - johnsmith21006 10y ago
    Agree and why these latest "tech" companies that do NOT actually sell their tech will not fall as easily from industry changes. I have a tough time seeing the new three, Google, Amazon and FB going away. I can see it with MS and Apple.
- mariojv 10y ago
  AWS is huge. You could argue that this is selling "physical stuff," but I view it as heavily abstracted away from the physical infrastructure, especially with products like Lambda. I don't think they even offer a baremetal option.
  - Pigo 10y ago
    I think cloud services and IoT devices when I think Amazon myself. Originally they were just where I went to buy college textbooks, but the times.. they are a'changin..
AndrewKemendo 10y ago
The exascale technology corporation of the 21st century is a completely different beast than the mega-corporations of the 20th century in one absolutely key way: They are disrupting themselves to successfully stay relevant in a fast moving market. Back before Google became Alphabet, they made a huge decision to realign themselves around Machine Learning as the core of how they do business in all aspects [1]. It could do that because 1. Their services could benefit from the improvement directly and 2. it didn't need to build a new machine factory, or assembly line like GE would have had to, if it wanted to completely realign themselves to eg. solar production or a 21st century technology. It sounds trivial and obvious but Google, Amazon, Facebook, Microsoft and Apple are all information management companies. They are all trying to become the central nervous system for consumer behavior in all aspects. That means collecting ungodly amounts of data, having a dense psychometric profile of users and then feeding users what they want to feed them. The better data they have the more locked in people become and there are fewer sources of data available for other people. So they most important thing is to get users to become part of their ecosystem - that means having some kind of insight into every digital system that a user interacts with. Unless you can create a new ecosystem that people interact with at such scale (Snap is probably the closest) then you can't compete with them. Also notice that Snap is still relying on Google Cloud [2] so Google wins either way. The fact that the top 5 have so much money, talent etc... also means that any company that isn't a leap beyond in user interaction, can be easily wooed through a lucrative acquisition and access to user data at massive scale. It's only going to get more consolidated because the average person only cares about usability and interoperability - so even if you aren't locked into just Apple, or Google, they all touch each other in some way that you are going to be part of the big 5 ecosystem no matter what. [1]https://www.wired.com/2016/11/google-facebook-microsoft-remaking-around-ai/ https://www.wired.com/2016/11/google-facebook-microsoft-rema... [2] http://www.recode.net/2017/2/2/14492026/snap-ipo-2-billion-contract-with-google-cloud http://www.recode.net/2017/2/2/14492026/snap-ipo-2-billion-c...
amyjess 10y ago
> In fact, I’d be amazed if there weren’t plenty of startups whose main goal is to be purchased by the Gang. This happens whenever an industry has a dominant player with deep pockets. For example, back when telecom was a much healthier industry, the main reason why anyone would start a telecom startup was to get acquired by Cisco.
Bartweiss 10y ago
> To be clear, I’m not alleging that the Gang of Five is colluding with each other to fix prices, or to actively suppress innovation; or to do anything illegal. I am certainly not suggesting they be sued for antitrust violations, like the once-sole dominant platform company, Microsoft, was in the late 1990’s. I found this an odd comment, because we don't have to "allege collusion". It's been documented and settled in court. It was wage fixing, not price fixing, but it's still clear evidence that the "Gang" is willing to work together against the market.
- simonh 10y ago
  Up to a point, but the wage fixing issue has already been settled and this article is current, not historical. Walt is pointing at what he sees happening now. Can you point out instances of criminal collusion you think are or might be currently happening?
  - Bartweiss 10y ago
    This is a reasonable criticism, but it also feels a bit like the circular argument used for the TPP: "You're talking about the old idea, you need to respond to the new one we won't let you see!" I don't have an example of ongoing collusion, but a week before the wage fixing news broke I couldn't have cited that, either. I could probably muster something about coopting web standards organizations or hypocritical stances on net neutrality, but it would be weak. I didn't mean to attack Walt for saying "alleging", and I recognize he's talking about consumer-facing issues anyway, but I did think it was a relevant historical note that this was very recently more than an allegation.
  - RestlessMind 10y ago
    These big tech co's have already demonstrated that they are willing to break rules if its suits them (cf. wage fixing). What makes you trust them at this point? What have they done to redeem themselves?
- kyleschiller 10y ago
  To be clear, the "wage-fixing" was a no cold-call agreement that involved Apple and Google, not the rest of the companies mentioned. [0] I'm all for criticizing giant companies but can we at least get our facts straight and not sound conspiratorial about it? [0] https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
diego_moita 10y ago
As everything else on HN, this is a very American-centric perception. There are a lot of other companies that are not "big whales in the see but are crocodiles on the Yang-Tse", as Jack Ma once said. China is the most obvious example (Alibaba, Taobao, Weibo) but there are also some European and Indian companies worth paying attention. If Asian growth takes a hold on this century and if Europe keeps getting freaked out about American espionage then this "Gang of five" will face some tough competition.
sputknick 10y ago
IS this not just a symptom of a maturing industry? At one point America had hundreds of automotive companies, those hundreds consolidated down to three. 100 years later, those three are still dominate. I'm not saying it's good or bad, but it sounds like something that has happened before and from that we can drive the discussion on weather this is good or bad, or something we can ignore.
- antisthenes 10y ago
  It is a symptom of capitalism in general. Capital tends to consolidate in monopolies or colluding oligopolies within 1 industry, because of economies of scale.
hd4 10y ago
The way I deal with it is not to put all my eggs in one basket. For instance, don't link your online accounts to one email, have one separate email address just for those. And try to use a different email provider to the company who makes your mobile OS. And just don't use proprietary OSs where possible, go with Linux or BSD. In fact these days I'd recommend BSD if you really want to avoid too much bad data-gathering practice (even though I still use Linux myself out of habit), just because BSD still has a relatively unsullied rep.
swframe2 10y ago
Very large companies are keeping a lot of money overseas. It seems be very inefficient if their saving are not used in investments that are closely connected to consumer financial benefits. Should society be concerned with the flow of money out of the local economy? Isn't it a idea (for the companies) to move hundreds of billion dollars out of the economy their customers need to make a living? I wonder if these companies should offer low interests loans to people to buy their products in much the same way that China buys US treasury bonds. Maybe there should be limits to how much a company should be allowed to save and it should return the rest to investors.
deleted 10y ago
[deleted]

124 points by hollaur 10y ago

I don't think you can consider 5 companies to be an oligopoly especially when you don't see monopolistic practices. These companies regularly undercut each other and innovate.

tabeth 10y ago
I find this kind of learned helplessness to be fascinating. Do you think big companies need apologists? Do you think there would be more or less innovation with more smaller firms?
- cylinder 10y ago
  Reminds me of when people were fine with erosion of civil liberties, expansion of surveillance, etc, under Obama because they trusted him and thought he was decent, and that they could probably trust future Presidents with that power too. Here, they find the current crop of leaders at these companies decent enough, not realizing their control and leadership will change over time.
- friedman23 10y ago
  Helplessness? Apologist? I don't consider Google/Facebook/etc my enemy like you seem to. These companies are not exploiting me, I have no reason to be hostile to them (profit is not exploitation). > Do you think there would be more or less innovation with more smaller firms? Likely less, I do not think that private space exploration or self driving cars would be possible without the massive accumulation of capital enabled by tech giants. Now let's look at the counterfactual, the US has massive tech giants and the majority innovation comes from or to the US. Other countries don't, other countries don't have nearly as much innovation bar a few exceptions. And truthfully, I find people that are anti capitalism to be far more interesting. It's amazing that people can convince themselves that private ownership is wrong while living in the most prosperous time in history and also believing that stripping those better off of their wealth will somehow lead to a more prosperous society when every time it has been done it has lead to disaster.
  - Method-X 10y ago
    Great post. You would really like Peter Thiel (read Zero To One).
  - majewsky 10y ago
    > I do not think that [...] self driving cars would be possible without the massive accumulation of capital enabled by tech giants Yet people are building self-driving cars as a hobby project. Sure, the whole topic would not progress that fast, but that statement is a bit overblown. (Same for private space exploration to a much more limited extent.)
    - taneq 10y ago
      People are building toy systems that work in limited scenarios, not putting in the hard engineering work to build robust, generally applicable systems. (Unless there's some significant hobbyist self-driving system I don't know about? The closest thing I can think of was comma.ai and that was barely at the "won't drive off a fairly straight highway, probably" stage.)
      - tomhoward 10y ago
        People are building toy systems that work in limited scenarios, not putting in the hard engineering work to build robust, generally applicable systems Also, they're building these systems using tech that has been developed and open-sourced by the big players.
  - sharemywin 10y ago
    It's funny you make it sound sound like Darpa had no part in self driving cars. or that the government space program didn't set the standard and the foundation for private space exploration. Yes Capitalism and Liberal Democracy is the most powerful system man has ever created. Hopefully we don't screw it up by giving all the credit to the guy handing you the apple from the orchard we call the "western world" Football is an awesome game but without the guys in the black and white uniforms it would be nothing but chaos.
aaron-lebo 10y ago
Except when they collude: https://www.theguardian.com/technology/2014/apr/24/apple-google-settle-antitrust-lawsuit-hiring-collusion https://www.theguardian.com/technology/2014/apr/24/apple-goo... and collude: https://www.theguardian.com/technology/2016/mar/07/apple-450-million-settlement-e-book-price-fixing-supreme-court https://www.theguardian.com/technology/2016/mar/07/apple-450... ...and collude: http://www.billboard.com/articles/news/6590827/apple-music-major-labels-investigated-collusion http://www.billboard.com/articles/news/6590827/apple-music-m...
- friedman23 10y ago
  Yes, and it's illegal. Having a monopoly isn't illegal. Anyway, your statement is completely unrelated to the subject of whether these companies would be innovating more if the market was less consolidated and I don't believe so.
  - aaron-lebo 10y ago
    Some kinds of monopoly are illegal. That first case was an antitrust case which has some connection to anti-monopoly, yeah? Those companies have had a decade at the top with all the money and talent in the world. Has tech gotten that much better since 2007? Has Apple's hardware gotten better relative to the competition? Has your web experience gotten remarkably better? Do we prefer Allo or Hangouts or x, y, or z to Google Talk? With the clout they have you have to innovate some and they certainly have. The question is whether they have innovated substantially. It doesn't seem like it.
    - friedman23 10y ago
      > Has tech gotten that much better since 2007? Yes > Apple's hardware gotten better relative to the competition? "Relative", explain why you put that qualifier please beyond not having an argument. Also yes. > Has your web experience gotten remarkably better? Yes > Do we prefer Allo or Hangouts or x, y, or z to Google Talk? Hangouts, what's your point here? You really don't remember what tech was like 10 years ago.

Apocryphon 10y ago

It's quite interesting to speculate who would be the sixth empire. Based on their attempts to dip their fingers into as many pies as possible, I'd say Uber is a would-be contender, and the platform they've been trying to own is the real world. As far as on-demand service economy startups go, they're certainly preeminent.

otalp 10y ago
I'd say Snap is more likely if they expand beyond their app.
- Method-X 10y ago
  Not a chance. Expand where?
  - k-mcgrady 10y ago
    Wearables (already started with Spectacles), drones (supposedly already working on that and close to launch). Those could lead to many other things (Snap OS for the wearables, fitness stuff in the wearables, Youtube competitor with drone videos etc).
    - simonh 10y ago
      All of which anyone else could do, and many companies already are. Meanwhile Snap is burning huge quantities of money faster than ever on seriously unprofitable core businesses. It's own investors prospectus says it "may never achieve or maintain profitability,". Good luck with that.
empath75 10y ago
Verizon just bought aol and yahoo and are looking for more companies to buy.
- Bartweiss 10y ago
  Verizon seems like a strong contender. They're well placed to follow the Gang's general model of using a profitable near-monopoly business to enable lots speculative purchases and projects. (Amazon: AWS and sales, Google: search/ads, Apple: hardware, Facebook: FB and Instagram) If we're going to see a sixth player, it will be someone who can get massive, hard-to-threaten control over some major part of the web ecosystem. Data access sounds like a winner to me, especially if net neutrality crumbles.

epberry 10y ago

I'm not sure what the point of this piece is. There is fierce competition between these five and consumers are better for it. I think you can look at the cloud war between Google, Amazon, and Microsoft as a great example of competition among these companies producing better technology and lower prices. If there was collusion, we would see cloud costs and technology stagnate like cars from Detroit in the 70s and 80s. Instead the opposite is happening.

Apocryphon 10y ago
I guess the natural question is whether or not having markets be owned by a small number of companies prevents new entrants from competing successfully. I leave that point to be debated by others. On a different note, it's interesting how the presence of the giants affects the startup world. I am reminded of a passage from No Exit by Gideon Lewis-Kraus [0]: 'All the while, Martino’s ultimate warning—that they might someday regret actually getting the money they wanted—would still hang over these two young men, inherent to a system designed to turn strivers into subcontractors. Instead of what you want to build—the consumer-facing, world-remaking thing—almost invariably you are pushed to build a small piece of technology that somebody with a lot of money wants built cheaply. As the engineer and writer Alex Payne put it, these startups represent “the field offices of a large distributed workforce assembled by venture capitalists and their associate institutions,” doing low-overhead, low-risk R&D for five corporate giants. In such a system, the real disillusionment isn’t the discovery that you’re unlikely to become a billionaire; it’s the realization that your feeling of autonomy is a fantasy, and that the vast majority of you have been set up to fail by design.' [0] https://news.ycombinator.com/item?id=7643902 https://news.ycombinator.com/item?id=7643902
- friedman23 10y ago
  What is your definition of successful? Is it becoming a tech giant, is it being acquired for a billion dollars by a tech giant, or is it being a small profitable company that fills a certain niche and never expands beyond it?
  - 10y ago

handsomechad 10y ago

After reading the article I tried to think of all of the ways which I interact with the "gang of five" and quantify their importance in my life. Apple - I'm writing this on a brand new Macbook Pro, and my iPhone is sitting right next to me. I have a $5/month subscription to Apple Music. It would be painful, but with a gun to my head I could easily switch to Windows, Android, and Spotify. Google - I'm browsing HN in Chrome, by far my favorite browser. I use google search dozens of times throughout the day to figure things out, it's truly an extension of my brain. I could switch to a new browser, but I haven't tried Bing enough recently to know if it would compare to Google. Amazon - I have a Prime membership, but I'm only a sporadic online shopper. That said, the Amazon shopping experience has provided me with a lot of value. No real alternatives here. Facebook - I don't use Instagram, I don't use WhatsApp, I do have a Facebook but I don't use my real name and I have very few friends. I use the News Feed Eradicator extension to get rid of the Trending section and the News Feed. Of all of the companies, I consider Facebook the most dispensable from a personal perspective . The only features I regularly use are Chat, which is functionality that existed long before Facebook, and sometimes stalking people that I just met to see more pictures and get a "life resume" on them, which is a habit that I would rather not be able to indulge in to be quite honest. Microsoft - My work computer runs on Windows, I use Office 365 at work, and of course tons of companies that I rely on in my consumption supply chain and infrastructure are dependent on Microsoft in some form or the other. I'm truly shocked at Facebook's ascendance to the tech stratosphere. Obviously the numbers don't lie, but Facebook just seems like it has so much lower utility than all of the other companies mentioned here. Yes, it's younger and in a newer category, but all of the other companies provide fundamental building blocks to the modern technological experience. Social media seems so much more superfluous by comparison.

jefe_ 10y ago
Facebook with Whats App has the strongest penetration in developing countries of all companies listed. Many of these places have large, young populations. I would be curious to know how many people exist in Facebook DBs but not the DBs of their own government. This is where I see Facebook value.
vincentleeuwen 10y ago

thomasthomas 10y ago

Funny how amazon gets thrown in with facebook under the 'consumer tech industry' moniker. facebook sells ads to make money. amazon sells physical stuff. how are they related besides both using technology? I think we should group businesses by how they make money and who they compete against. 'technology company' doesn't mean anything in a world where every company has technology.

golemotron 10y ago
Google is a technology company that sells ads. Amazon is a technology company that sells goods. It's not what you have, it's what you are. The future isn't bright for companies that just "have" technology.
- johnsmith21006 10y ago
  Agree and why these latest "tech" companies that do NOT actually sell their tech will not fall as easily from industry changes. I have a tough time seeing the new three, Google, Amazon and FB going away. I can see it with MS and Apple.
mariojv 10y ago
AWS is huge. You could argue that this is selling "physical stuff," but I view it as heavily abstracted away from the physical infrastructure, especially with products like Lambda. I don't think they even offer a baremetal option.
- Pigo 10y ago
  I think cloud services and IoT devices when I think Amazon myself. Originally they were just where I went to buy college textbooks, but the times.. they are a'changin..

AndrewKemendo 10y ago

The exascale technology corporation of the 21st century is a completely different beast than the mega-corporations of the 20th century in one absolutely key way: They are disrupting themselves to successfully stay relevant in a fast moving market. Back before Google became Alphabet, they made a huge decision to realign themselves around Machine Learning as the core of how they do business in all aspects [1]. It could do that because 1. Their services could benefit from the improvement directly and 2. it didn't need to build a new machine factory, or assembly line like GE would have had to, if it wanted to completely realign themselves to eg. solar production or a 21st century technology. It sounds trivial and obvious but Google, Amazon, Facebook, Microsoft and Apple are all information management companies. They are all trying to become the central nervous system for consumer behavior in all aspects. That means collecting ungodly amounts of data, having a dense psychometric profile of users and then feeding users what they want to feed them. The better data they have the more locked in people become and there are fewer sources of data available for other people. So they most important thing is to get users to become part of their ecosystem - that means having some kind of insight into every digital system that a user interacts with. Unless you can create a new ecosystem that people interact with at such scale (Snap is probably the closest) then you can't compete with them. Also notice that Snap is still relying on Google Cloud [2] so Google wins either way. The fact that the top 5 have so much money, talent etc... also means that any company that isn't a leap beyond in user interaction, can be easily wooed through a lucrative acquisition and access to user data at massive scale. It's only going to get more consolidated because the average person only cares about usability and interoperability - so even if you aren't locked into just Apple, or Google, they all touch each other in some way that you are going to be part of the big 5 ecosystem no matter what. [1]https://www.wired.com/2016/11/google-facebook-microsoft-remaking-around-ai/ https://www.wired.com/2016/11/google-facebook-microsoft-rema... [2] http://www.recode.net/2017/2/2/14492026/snap-ipo-2-billion-contract-with-google-cloud http://www.recode.net/2017/2/2/14492026/snap-ipo-2-billion-c...

amyjess 10y ago

> In fact, I’d be amazed if there weren’t plenty of startups whose main goal is to be purchased by the Gang. This happens whenever an industry has a dominant player with deep pockets. For example, back when telecom was a much healthier industry, the main reason why anyone would start a telecom startup was to get acquired by Cisco.

Bartweiss 10y ago

> To be clear, I’m not alleging that the Gang of Five is colluding with each other to fix prices, or to actively suppress innovation; or to do anything illegal. I am certainly not suggesting they be sued for antitrust violations, like the once-sole dominant platform company, Microsoft, was in the late 1990’s. I found this an odd comment, because we don't have to "allege collusion". It's been documented and settled in court. It was wage fixing, not price fixing, but it's still clear evidence that the "Gang" is willing to work together against the market.

simonh 10y ago
Up to a point, but the wage fixing issue has already been settled and this article is current, not historical. Walt is pointing at what he sees happening now. Can you point out instances of criminal collusion you think are or might be currently happening?
- Bartweiss 10y ago
  This is a reasonable criticism, but it also feels a bit like the circular argument used for the TPP: "You're talking about the old idea, you need to respond to the new one we won't let you see!" I don't have an example of ongoing collusion, but a week before the wage fixing news broke I couldn't have cited that, either. I could probably muster something about coopting web standards organizations or hypocritical stances on net neutrality, but it would be weak. I didn't mean to attack Walt for saying "alleging", and I recognize he's talking about consumer-facing issues anyway, but I did think it was a relevant historical note that this was very recently more than an allegation.
- RestlessMind 10y ago
  These big tech co's have already demonstrated that they are willing to break rules if its suits them (cf. wage fixing). What makes you trust them at this point? What have they done to redeem themselves?
kyleschiller 10y ago
To be clear, the "wage-fixing" was a no cold-call agreement that involved Apple and Google, not the rest of the companies mentioned. [0] I'm all for criticizing giant companies but can we at least get our facts straight and not sound conspiratorial about it? [0] https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...

diego_moita 10y ago

As everything else on HN, this is a very American-centric perception. There are a lot of other companies that are not "big whales in the see but are crocodiles on the Yang-Tse", as Jack Ma once said. China is the most obvious example (Alibaba, Taobao, Weibo) but there are also some European and Indian companies worth paying attention. If Asian growth takes a hold on this century and if Europe keeps getting freaked out about American espionage then this "Gang of five" will face some tough competition.

sputknick 10y ago

IS this not just a symptom of a maturing industry? At one point America had hundreds of automotive companies, those hundreds consolidated down to three. 100 years later, those three are still dominate. I'm not saying it's good or bad, but it sounds like something that has happened before and from that we can drive the discussion on weather this is good or bad, or something we can ignore.

antisthenes 10y ago
It is a symptom of capitalism in general. Capital tends to consolidate in monopolies or colluding oligopolies within 1 industry, because of economies of scale.

hd4 10y ago

The way I deal with it is not to put all my eggs in one basket. For instance, don't link your online accounts to one email, have one separate email address just for those. And try to use a different email provider to the company who makes your mobile OS. And just don't use proprietary OSs where possible, go with Linux or BSD. In fact these days I'd recommend BSD if you really want to avoid too much bad data-gathering practice (even though I still use Linux myself out of habit), just because BSD still has a relatively unsullied rep.

swframe2 10y ago

Very large companies are keeping a lot of money overseas. It seems be very inefficient if their saving are not used in investments that are closely connected to consumer financial benefits. Should society be concerned with the flow of money out of the local economy? Isn't it a idea (for the companies) to move hundreds of billion dollars out of the economy their customers need to make a living? I wonder if these companies should offer low interests loans to people to buy their products in much the same way that China buys US treasury bonds. Maybe there should be limits to how much a company should be allowed to save and it should return the rest to investors.

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