15 ms·

Trust-Busting as the Unsexy Answer to Google and Facebook

313 points by prostoalex 8y ago

stcredzero 8y ago
Capitalism, according to all these men, is about frictionless, seamless engorgement. The writer is losing the thread a bit here. "Eating" in this context, means to disrupt with a more efficient way of doing things. "Eating people" is replacing manual jobs performed by people with automation and networks. If a job can be "eaten" then that means keeping it is just top-down mandated make-work. More generally, he argues that we are, in fact, in an all-out return of the Gilded Age — and perhaps only the clothing has changed. We are, in fact, in yet another variation of a "Gilded Age." [1] Only the clothing and particular cultural artifacts have changed. For years on this site, I've been making an analogy between SV of today and "Mad Men." I think people have misunderstood. In both cases, there's a tribe of people, recently imbued with greater socioeconomic status, mostly from all of the same schools, with the same subculture, dressing the same, consuming the same non-mainstream products, becoming increasingly out of touch with mainstream people and mainstream culture. In both cases, the interests of the subgroup have diverged and come to odds with the interests of society at large. In both cases, many members of the subgroup have come to look down upon the society and mainstream culture they originally came from. When it comes down to it, groupthink is the underlying motivating factor in all of history's great tragedies and great evils. As an intellectual in 2019, it behooves you to constantly look over your shoulder for its approach. Look across the media landscape for its encroachment. Look the hardest at yourself and those nearest to you. ([1] - yes, I know the one referenced predates the Mad Men milieu. There are many gilded ages.)
x220 8y ago
Would trust-busting do any good? The main reason no practical alternatives to Facebook exist is the network effect. The main reason that competitors to Google don't do well is that people will just use the search engine that returns the most relevant results (unless your internet connection is censored). The only practical solution is regulating ethical behavior of these incomprehensibly powerful corporations.
- malka 8y ago
  if such things are meant to be monopolistic, then the state should manage it.
  - Zecar 8y ago
    You want the state in charge of managing communications between friends and family members?
    - Qwertystop 8y ago
      In the same way/to the same degree that the state manages the phone lines and the postal system, I suppose.
    - gotocake 8y ago
      Yes, in the same way they had to bust Ma Bell for the same damned reasons we’re seeing again. Let the state be the dumb pipe or at least ensure that the pipes stay dumb. It’s not perfect, but it’s better than the alternative.
    - x220 8y ago
      The state already unofficially manages, manipulates, and spies on communication.
    - roguecoder 8y ago
      Rather than private corporations who turn around and exploit private communications between friends and family members for maximum profit? Yes. The state could abuse its power: companies do abuse their power, because to do otherwise would reduce shareholder profits.
    - x220 8y ago
      I want the state to specify restrictions on how companies can use the data transmitted in private messages on social networks.
    - fixermark 8y ago
40acres 8y ago
As talked about in this article, I think the main catalyst to increased anti-trust scrunity will be a mind shift away from the "consumer welfare" view of anti-trust. For the most part, big tech companies provide amazing service. I can't think of another industry that has a product as good as the tech companies of today have. Yes there may be some fakes on Amazon, and DDG in some use cases may be better than Google, but for the majority of consumers these companies provide excellent service. We really need more scrunity when it comes to acquisitions, the fact that Google was able to acquire YouTube and Facebook was able to acquire Instagram shows a real lack of foresight on regulators. Perhaps this is because when you're busting up Standard Oil you have more tangible view of what the monopoly looks like: the oil company owns the fields, the railroads, the refineries, the whole damn stack. When it comes to tech everything is a data play, Google (a search engine) and YouTube (a video site) look like distinct industry, but at the end of the day the main resource being competed for is attention and data.
- dwater 8y ago
  I was just watching an interview between Scott Galloway and Richard Kramer discussing if the big 4 will be broken up. An insight I hadn't heard before was that anti-trust in the US is based on consumer harm, and since consumers get services from these companies for free, by this measure there can't be consumer harm. However, if you consider the advertisers (who are actually funding everything) are the consumers, they are being significantly harmed by the lack of competition. An advertiser has essentially no choice, if they wish to reach consumers online they have to deal with the big 4 on their terms. https://www.youtube.com/watch?v=jD7LyAJWkZ0 https://www.youtube.com/watch?v=jD7LyAJWkZ0
  - tracker1 8y ago
    I think it works both ways... the advertisers are harmed by lack of competition (though is it really different than only 3 TV networks), and the users are harmed by mismanaged marketing, leaking personal information and as an attack vector.
  - mattmaroon 8y ago
    I don't think it's logical to say that just because consumers don't directly pay they aren't harmed. What if increased competition would make it such that there would be a way better search engine than today's Google? It's certainly harder to prove harm than monopolistic price fixing though.
kryogen1c 8y ago
As a self-defined libertarian, I think one of the most critical functions a government is responsible for is anti-trust and Monopoly busting. This is one of the critical issues of our time, but is only a symptom of the corruption of Congress, which is a deep topic in it's own right. Free markets are like any hierarchy, and if theres no regulation mechanism the powerful will dominate the less powerful. I think history and established economic and game theory is fairly universal on this point. I'd be interested to hear an argument that these international megacorporations without meaningful competition don't need to be broken up.
- kevin_b_er 8y ago
  This doesn't sound like a liberatarian, at least not in the US. The one with the strongest competitive greed who wins the most money/power is viewed as the end-goal and the most successful under the ideology. Thus, a monopoly is really the end-goal of US libertarianism for they had the highest wealth and are assumed to have the highest drive to have the most wealth. Libertarianism opposes that the will of the people should constrain avarice or rich and powerful. Greed is always good under libertarianism. The philosophy is particular popular for the rich because it is a tool to prevent the will of the people from constraining their power through wealth. So, Libertarianism blames regulation itself as the cause of monopolies because they look mainly at regulatory capture, which is done through greed-based corruption of government. Libertarian philosophy would view reducing the regulation, and thus any constraint on Facebook's avarice, as the solution to Facebook's monopoly. So, you shouldn't, as a libertarian, propose trust-busting regulation for Facebook, as this is the opposite of libertarian.
  - feanaro 8y ago
    There is plenty left in the libertarian philosophy even if you take away the concept of idly sitting by, watching perverse, runaway growth. For example, ideas like bounding government power and reducing it to a few minimum functions and letting the market handle most things by itself. This does not necessarily imply letting the market go completely unchecked and requiring it to serve every need. I think that decentralization of power is one of those profoundly libertarian ideas that is not often explicitly recognized as one.After all, a corporation in which power is extremely centralized is hard to differentiate from a government. Furthermore, if there is no one keeping it in any kind of check, what is preventing it from becoming a totalitarian government? Markets work best when there is at least some level of decentralization. In other words, when you don't let any entity acquire a significant portion of total power.
x220 8y ago
>Capitalism, according to all these men, is about frictionless, seamless engorgement. I could not care less about the opinions of thirty-something techies about political ideologies. At a time when capitalism seems more attacked in the West than at any other time in modern history, I think it is deceitful to talk about capitalism from the point of view of the group of the most unethical business leaders in America. We wouldn't tolerate someone defining socialism from the point of view of dictators.
- minikites 8y ago
  >We wouldn't tolerate someone defining socialism from the point of view of dictators. Venezuela, Stalin, Mao, etc all get brought up constantly in discussions about socialism/communism.
  - x220 8y ago
    >all get brought up constantly and are quickly met with "that's not real socialism".
jpollock 8y ago
"when AT&T was broken up in 1984, a torrent of new products came on the market, everything from the first answering machines to early ISPs." Since the RBOCs were local monopolies, it wasn't the breakup which resulted in the opening of the network. They didn't have competition until 1996, when the local loop was unbundled, allowing CLECs to appear. The tradeoff was that if they could demonstrate local competition, they were allowed to enter the long distance market. It was FCC regulation which allowed interconnection of non-approved devices [1]. "In the 1960s and 1970s, the FCC gradually relaxed regulation of telephone terminal equipment (e.g., telephone handsets, private branch exchanges), known as customer premises equipment (CPE)." [1] https://www.nap.edu/read/10235/chapter/11#298 https://www.nap.edu/read/10235/chapter/11#298 [2] http://bpastudio.csudh.edu/fac/lpress/471/hout/telecomHistory/ http://bpastudio.csudh.edu/fac/lpress/471/hout/telecomHistor... [3] https://www.mackinac.org/6033 https://www.mackinac.org/6033
- pitaj 8y ago
  At&T was also a monopoly created by the government. It was in no way spontaneous.
- dbt00 8y ago
  I think the post you're responding to is thinking of the unleashing of non-Bell-owned equipment on AT&T lines. This was prohibited by AT&T until the FCC forced them to drop this provision. Commonly known as the Carterphone decision, this happened in 1968. Fax machines, modems, answering machines and other devices were mostly only possible after this change.
  - jpollock 8y ago
    Correct, that is what they are referring to. However, they are directly linking it to the 1984 breakup, which was not what allowed it. Thanks for the name of the decision [1], I had a hard time finding a reference. :) So, yes, it's an argument for regulation, but not for breaking up a monopoly. :) There are many good reasons to break up monopolies, but their thesis is that the 1984 breakup led to the development of ISPs because people were all of a sudden allowed to plug random things into the network. [1] Carterfone Decision: https://en.wikipedia.org/wiki/Carterfone#Landmark_regulatory_decision https://en.wikipedia.org/wiki/Carterfone#Landmark_regulatory...
ilaksh 8y ago
Good article. I hope that trust-busting becomes popular again. The article did not mention technological intervention in this situation. I believe we will eventually move past the technopolies and decentralized technologies will play a large part. In my opinion the power and scope of some companies overlaps with or even effectively supercedes government in some ways. To me these are demonstrations of the obsolescence of current government structures. The all-encompassing networks provided by these monopolies are extremely useful and I believe the main reason we tolerate them. They provide a platform. Decentralized technologies are becoming increasingly capable and popular. The only realistic alternatives to the giant monopoly companies are platforms built on decentralized technologies. I also suspect that for government to be able to keep up or be effective it also needs to be decentralized and possibly integrated in some way into the decentralized systems or metasystems.
rifung 8y ago
I work for Google, opinions are my own. Have there been any studies or anything on how having or breaking up large companies affects a country's competitiveness on a global scale? I feel like an extremely large company may be more competitive but this may come at the expense of other companies in the same or other industries. FWIW I personally agree with using antitrust to break up companies that don't harm consumers despite currently benefiting from the system.
- ocdtrekkie 8y ago
  I am not sure if fear of China is an adequate justification to allow rampant misconduct of a corporation here. Consider that we could just the same argue that having a minimum wage that's (still woefully inadequate, but higher than China) also significantly harms the competitiveness of our country's competitiveness in many industries on the global stage. It would probably be better to deal with issues of other country's power via trade agreements and political pressure.
kauffj 8y ago
Rather than trust busting, why not start with relaxing the federal laws which forbid the development of third-party applications? The limits on third-party apps are legal, not technical. It is not technically challenging to build an application that collects Facebook credentials and then presents alternative views and features. It could, for example, finally be possible to see a time-ordered view of your friends' posts (Facebook doesn't allow this since it reduces engagement). The development of such applications would serve as a threat and check on the market dominance of Facebook. A popular third-party application could consider adding its own features that Facebook does not have. It would also reduce Facebook's revenue. What stops this? In the US, it is primarily the CFAA (https://en.wikipedia.org/wiki/Computer_Fraud_and_Abuse_Act https://en.wikipedia.org/wiki/Computer_Fraud_and_Abuse_Act). Once Facebook formally tells a company to stop accessing their servers, they are in violation of federal law if they continue to do so. It seems premature to pursue trust busting action while we still have federal laws that encourage and cement the dominance of a single provider.
- taurath 8y ago
  Even if it were legal (which it should be IMO), I can't see anything other than a cat and mouse game happening where the primaries change their authentication patterns on a daily, hourly or minute to minute basis. Consider all the things that facebook does to mess with scrapers right now - every single letter in a div, multiples that are hidden, etc. Its a complete mess. "Forced open APIs" is an interesting idea in terms of actually bringing value to users - its almost on the level of nationalizing a company though in terms of being anti-business. Why Facebook would front the cost of running a service they can't monetize though is a big question.
  - surrealize 8y ago
    Forcing open APIs isn't anti-business. It's pro-competition and pro-startup. The only thing it's anti- is big incumbents, which is the point.
    - taurath 8y ago
yonran 8y ago
The moat that each tech company owns is its network. Rather than trust-busting these companies up into their different businesses, I think it would promote more competition to impose network interoperability requirements once the network is entrenched for too long. A useful example is craigslist: a company with virtually no innovation for decades that still dominates the classified listings space. Other companies that try to offer a better experience face the hurdle of creating their own network or attempting to scrape craigslist’s items (and then being kicked off by their lawyers). What regulation would allow meaningful competition? A policy that requires craigslist to provide an API to competing firms for reading and writing at a reasonable price, and a requirement that changes to the network not favor craigslist vs. other firms.
- kauffj 8y ago
  You don't need new regulation; you just need to get rid of existing regulation. It is currently illegal to build third-party applications once the first party tells you to stop. Craigslist actually was involved in the court case that cemented this: https://en.wikipedia.org/wiki/Craigslist_Inc._v._3Taps_Inc https://en.wikipedia.org/wiki/Craigslist_Inc._v._3Taps_Inc.
  - ucaetano 8y ago
    > It is currently illegal to build third-party applications once the first party tells you to stop. No, it is illegal to access the data of a third-party with your own app if that third-party doesn't allow you to do so.
  - debacle 8y ago
    You're spreading a lot of disinformation in this thread around the CFAA.
  - yonran 8y ago
    We could go back to the world where the AIM vs. MSN Messenger Chat Wars were legal (https://nplusonemag.com/issue-19/essays/chat-wars/ https://nplusonemag.com/issue-19/essays/chat-wars/). But reverse engineering APIs required an adversary with deep pockets, so I don’t think that is sufficient. We need an explicit regulation that a company’s monopoly over its network doesn’t last forever, just as patents are not forever.
pradn 8y ago
One complement/substitute for this approach is mandating open standards. If Facebook had to be part of the Fediverse or something like that. The standards could be managed by a third-party, something like the Federal Reserve for APIs. This way they can move to accommodate fast-moving changes and competition from companies in other countries.
tropo 8y ago
Will we ever again break up a monopoly? The attempt instantly becomes a political battle. The moment a politician takes sides, the other party opposes, and the initial politician's party backs him up. Politicians collect lots of money. There is then a highly politicized court case which the company drags out until there is a change of political power. Once political power changes, the government purposely sabotages their own case until the company wins.
gajeam 8y ago
Lot of people talking about third-party application development in this thread. It's also worth considering the opposite side of that, data portability. GDPR already requires companies allow users to easily export all their data [1], and if the US did the same it could really help mitigate the network effect social media companies use to hold onto their dominance (i.e. Facebook's properties) [1] https://gdpr-info.eu/art-20-gdpr/ https://gdpr-info.eu/art-20-gdpr/
- dane-pgp 8y ago
  Competitors to Facebook really need to be aware of the power of this law. In particular, it says: "The data subject shall have the right to ... transmit those data to another controller without hindrance from the controller to which the personal data have been provided, where ... the processing is carried out by automated means... [, and] shall have the right to have the personal data transmitted directly from one controller to another, where technically feasible." If the data transfer is automated and direct, then a Facebook user should be able to request that their posts on Facebook be continually synched over to their Mastodon account (for example). As Facebook is already a member of the Data Transfer Project [1], it would look very bad for them if they only allowed data to be automatically synched one way, especially if most Fediverse implementations supported two way synch. Of course, once your data is fully synched, you'd never need to actually browse Facebook itself again, and your friends on both Facebook and Mastodon would be able to read your Mastodon posts. (I suppose Facebook would similarly cite "data protection reasons" for why they can't synch your friend's Facebook posts out to you on another site, though). Anyway, I'm sure an EU anti-trust investigator would enjoy the opportunity to examine claims against a big US social media company like Facebook, especially if it were a small EU social media provider bringing the complaint. [1] https://datatransferproject.dev/ https://datatransferproject.dev/
LifeLiverTransp 8y ago
But the factors that grew this giant remains, meaning this will turn into a whack-the-mole where nothing changes but the name and owner of the company that reeincarnates the by nature centralized public service these companies provide. I would suggest a partially privat solution. Meaning. The public owns such projects, once the investment was returned. Sort of a lease from the allmende, that always returns -as rewards for the maintenance of investment. And any company can temporary (1 year max) own this infrastructure, once it contributes signifantly to it.
ufmace 8y ago
> Tarbell’s 19-part exposé on Rockefeller’s Standard Oil would mark a turning point in setting public sentiment against the trusts. Seems modern tech monopolies have it much better, with far more control over the information the public sees and can share with each other. Particularly when they start buying up newspapers. Whatever the practicalities of going against them in this way, that's going to cause complications.
cat199 8y ago
1) Doesn't seem so unsexy to me - though I havent gotten any in a while (actual trust busting that is) 2) If raising the issue, why start with these 2? Many bigger and much more entrenched fish in our sea
simplecomplex 8y ago
So, Google and Facebook suck up lots of personal information and some people don't like that. Splitting them apart wouldn't change their business models. Arbitrary destruction of their business doesn't do anything to protect consumer privacy. There's also nothing anti-competitive about either business. Using a different website is as simple as typing a URL into your web browser.
personjerry 8y ago
At the heart of the article, the assertion that the power of these corporations is threatening our government implies that this is a problem -- which in turn implies that government is somehow superior to corporations. Why is this necessarily true?
- elefanten 8y ago
  It doesn't have to imply that government is outright superior to corporations. It would be sufficient to imply that neither should have overwhelming power over the other.
Proven 8y ago
Answer to Google and FB for what exactly? People voluntarily use their products and services and no one has proven they're doing anything wrong. It's just a bunch of interventionists arguing the State ought to do something because that would benefit customers (http://web.stanford.edu/~gentzkow/research/facebook.pdf http://web.stanford.edu/~gentzkow/research/facebook.pdf indicates that FB delivers enormous benefits to users according to the users themselves while these legal activists don't offer anything except their unhappiness about how capitalism works). As much as I dislike the two companies, letting some activists randomly call shots based on their views on social justice and what ought to be better for certain people would be much worse. The issue is these activists can't see is that too much regulation and State meddling makes it harder for new competitors to arise. They're one of causes of less competitive markets, but they think they're the solution.
mark_l_watson 8y ago
That was a good read. Having made a good living from programming since the early 1970s, I would like to give something back, but other than creating content and software with sharing licenses, I am not sure how to proceed. I used to feel good about donating to EFF, ACLU, and FSF but I have reduced my donations because I don’t feel like they are doing much good. I have read Tim Wu in the past and although he helps us understand the power dynamics of monopolies and controlling platforms, I don’t really get any actionable suggestions from him. Same could be said for this article: a good read, but left me wondering what, if anything, I can do to help.
sabalaba 8y ago
Surprised that HN has this sort of myopia in tech history. Are things really different this time? Standard Oil, U.S. Steel, Bell, IBM, Microsoft, AOL Time Warner. Cries for antitrust action are often a bellwether for organic disruption. A lot of the discussion here is about how to "organically" break the trust via regulatory changes such as repealing CFAA, more scrutiny around acquisitions, etc. It's not possible to understand the first order effects (let alone second and above) of regulation. Doing so without using the mighty/crude hammer of antitrust would presume that one knew how to organically disrupt these companies. "Oh! If only other people were to prevent Google from making all of these acquisitions we would have more competition in search!" "If only small companies could build 'third-party apps' legally!" Once you substitute out the ever-wise HN commenter with a member of our legislature does the absurdity of these statements become clear. Can we at least have the humility to say that we don't know how to disrupt these companies? There is already a massive profit incentive in the form of the net profits to be competed for. The answer to the question "How do you beat Google?" is for the market to answer. Before trying to come up with a regulatory solution, it's worth stepping back and realizing that if you knew exactly how to beat Google, you'd hopefully try and do it.
fouc 8y ago
Trust-Busting implies that we have to go out of our way to identify and bust monopolies every 10-20 years. That's the wrong fix here. Instead we should focus on finding alternative solutions that reduce the tendency to form these huge corporations or conglomerations. And encourage more companies/competition.

313 points by prostoalex 8y ago

Capitalism, according to all these men, is about frictionless, seamless engorgement. The writer is losing the thread a bit here. "Eating" in this context, means to disrupt with a more efficient way of doing things. "Eating people" is replacing manual jobs performed by people with automation and networks. If a job can be "eaten" then that means keeping it is just top-down mandated make-work. More generally, he argues that we are, in fact, in an all-out return of the Gilded Age — and perhaps only the clothing has changed. We are, in fact, in yet another variation of a "Gilded Age." [1] Only the clothing and particular cultural artifacts have changed. For years on this site, I've been making an analogy between SV of today and "Mad Men." I think people have misunderstood. In both cases, there's a tribe of people, recently imbued with greater socioeconomic status, mostly from all of the same schools, with the same subculture, dressing the same, consuming the same non-mainstream products, becoming increasingly out of touch with mainstream people and mainstream culture. In both cases, the interests of the subgroup have diverged and come to odds with the interests of society at large. In both cases, many members of the subgroup have come to look down upon the society and mainstream culture they originally came from. When it comes down to it, groupthink is the underlying motivating factor in all of history's great tragedies and great evils. As an intellectual in 2019, it behooves you to constantly look over your shoulder for its approach. Look across the media landscape for its encroachment. Look the hardest at yourself and those nearest to you. ([1] - yes, I know the one referenced predates the Mad Men milieu. There are many gilded ages.)

x220 8y ago

Would trust-busting do any good? The main reason no practical alternatives to Facebook exist is the network effect. The main reason that competitors to Google don't do well is that people will just use the search engine that returns the most relevant results (unless your internet connection is censored). The only practical solution is regulating ethical behavior of these incomprehensibly powerful corporations.

malka 8y ago
if such things are meant to be monopolistic, then the state should manage it.
- Zecar 8y ago
  You want the state in charge of managing communications between friends and family members?
  - Qwertystop 8y ago
    In the same way/to the same degree that the state manages the phone lines and the postal system, I suppose.
  - gotocake 8y ago
    Yes, in the same way they had to bust Ma Bell for the same damned reasons we’re seeing again. Let the state be the dumb pipe or at least ensure that the pipes stay dumb. It’s not perfect, but it’s better than the alternative.
  - x220 8y ago
    The state already unofficially manages, manipulates, and spies on communication.
  - roguecoder 8y ago
    Rather than private corporations who turn around and exploit private communications between friends and family members for maximum profit? Yes. The state could abuse its power: companies do abuse their power, because to do otherwise would reduce shareholder profits.
  - x220 8y ago
    I want the state to specify restrictions on how companies can use the data transmitted in private messages on social networks.
  - fixermark 8y ago

40acres 8y ago

As talked about in this article, I think the main catalyst to increased anti-trust scrunity will be a mind shift away from the "consumer welfare" view of anti-trust. For the most part, big tech companies provide amazing service. I can't think of another industry that has a product as good as the tech companies of today have. Yes there may be some fakes on Amazon, and DDG in some use cases may be better than Google, but for the majority of consumers these companies provide excellent service. We really need more scrunity when it comes to acquisitions, the fact that Google was able to acquire YouTube and Facebook was able to acquire Instagram shows a real lack of foresight on regulators. Perhaps this is because when you're busting up Standard Oil you have more tangible view of what the monopoly looks like: the oil company owns the fields, the railroads, the refineries, the whole damn stack. When it comes to tech everything is a data play, Google (a search engine) and YouTube (a video site) look like distinct industry, but at the end of the day the main resource being competed for is attention and data.

dwater 8y ago
I was just watching an interview between Scott Galloway and Richard Kramer discussing if the big 4 will be broken up. An insight I hadn't heard before was that anti-trust in the US is based on consumer harm, and since consumers get services from these companies for free, by this measure there can't be consumer harm. However, if you consider the advertisers (who are actually funding everything) are the consumers, they are being significantly harmed by the lack of competition. An advertiser has essentially no choice, if they wish to reach consumers online they have to deal with the big 4 on their terms. https://www.youtube.com/watch?v=jD7LyAJWkZ0 https://www.youtube.com/watch?v=jD7LyAJWkZ0
- tracker1 8y ago
  I think it works both ways... the advertisers are harmed by lack of competition (though is it really different than only 3 TV networks), and the users are harmed by mismanaged marketing, leaking personal information and as an attack vector.
- mattmaroon 8y ago
  I don't think it's logical to say that just because consumers don't directly pay they aren't harmed. What if increased competition would make it such that there would be a way better search engine than today's Google? It's certainly harder to prove harm than monopolistic price fixing though.

kryogen1c 8y ago

As a self-defined libertarian, I think one of the most critical functions a government is responsible for is anti-trust and Monopoly busting. This is one of the critical issues of our time, but is only a symptom of the corruption of Congress, which is a deep topic in it's own right. Free markets are like any hierarchy, and if theres no regulation mechanism the powerful will dominate the less powerful. I think history and established economic and game theory is fairly universal on this point. I'd be interested to hear an argument that these international megacorporations without meaningful competition don't need to be broken up.

kevin_b_er 8y ago
This doesn't sound like a liberatarian, at least not in the US. The one with the strongest competitive greed who wins the most money/power is viewed as the end-goal and the most successful under the ideology. Thus, a monopoly is really the end-goal of US libertarianism for they had the highest wealth and are assumed to have the highest drive to have the most wealth. Libertarianism opposes that the will of the people should constrain avarice or rich and powerful. Greed is always good under libertarianism. The philosophy is particular popular for the rich because it is a tool to prevent the will of the people from constraining their power through wealth. So, Libertarianism blames regulation itself as the cause of monopolies because they look mainly at regulatory capture, which is done through greed-based corruption of government. Libertarian philosophy would view reducing the regulation, and thus any constraint on Facebook's avarice, as the solution to Facebook's monopoly. So, you shouldn't, as a libertarian, propose trust-busting regulation for Facebook, as this is the opposite of libertarian.
- feanaro 8y ago
  There is plenty left in the libertarian philosophy even if you take away the concept of idly sitting by, watching perverse, runaway growth. For example, ideas like bounding government power and reducing it to a few minimum functions and letting the market handle most things by itself. This does not necessarily imply letting the market go completely unchecked and requiring it to serve every need. I think that decentralization of power is one of those profoundly libertarian ideas that is not often explicitly recognized as one.After all, a corporation in which power is extremely centralized is hard to differentiate from a government. Furthermore, if there is no one keeping it in any kind of check, what is preventing it from becoming a totalitarian government? Markets work best when there is at least some level of decentralization. In other words, when you don't let any entity acquire a significant portion of total power.

x220 8y ago

>Capitalism, according to all these men, is about frictionless, seamless engorgement. I could not care less about the opinions of thirty-something techies about political ideologies. At a time when capitalism seems more attacked in the West than at any other time in modern history, I think it is deceitful to talk about capitalism from the point of view of the group of the most unethical business leaders in America. We wouldn't tolerate someone defining socialism from the point of view of dictators.

minikites 8y ago
>We wouldn't tolerate someone defining socialism from the point of view of dictators. Venezuela, Stalin, Mao, etc all get brought up constantly in discussions about socialism/communism.
- x220 8y ago
  >all get brought up constantly and are quickly met with "that's not real socialism".

jpollock 8y ago

"when AT&T was broken up in 1984, a torrent of new products came on the market, everything from the first answering machines to early ISPs." Since the RBOCs were local monopolies, it wasn't the breakup which resulted in the opening of the network. They didn't have competition until 1996, when the local loop was unbundled, allowing CLECs to appear. The tradeoff was that if they could demonstrate local competition, they were allowed to enter the long distance market. It was FCC regulation which allowed interconnection of non-approved devices [1]. "In the 1960s and 1970s, the FCC gradually relaxed regulation of telephone terminal equipment (e.g., telephone handsets, private branch exchanges), known as customer premises equipment (CPE)." [1] https://www.nap.edu/read/10235/chapter/11#298 https://www.nap.edu/read/10235/chapter/11#298 [2] http://bpastudio.csudh.edu/fac/lpress/471/hout/telecomHistory/ http://bpastudio.csudh.edu/fac/lpress/471/hout/telecomHistor... [3] https://www.mackinac.org/6033 https://www.mackinac.org/6033

pitaj 8y ago
At&T was also a monopoly created by the government. It was in no way spontaneous.
dbt00 8y ago
I think the post you're responding to is thinking of the unleashing of non-Bell-owned equipment on AT&T lines. This was prohibited by AT&T until the FCC forced them to drop this provision. Commonly known as the Carterphone decision, this happened in 1968. Fax machines, modems, answering machines and other devices were mostly only possible after this change.
- jpollock 8y ago
  Correct, that is what they are referring to. However, they are directly linking it to the 1984 breakup, which was not what allowed it. Thanks for the name of the decision [1], I had a hard time finding a reference. :) So, yes, it's an argument for regulation, but not for breaking up a monopoly. :) There are many good reasons to break up monopolies, but their thesis is that the 1984 breakup led to the development of ISPs because people were all of a sudden allowed to plug random things into the network. [1] Carterfone Decision: https://en.wikipedia.org/wiki/Carterfone#Landmark_regulatory_decision https://en.wikipedia.org/wiki/Carterfone#Landmark_regulatory...

ilaksh 8y ago

Good article. I hope that trust-busting becomes popular again. The article did not mention technological intervention in this situation. I believe we will eventually move past the technopolies and decentralized technologies will play a large part. In my opinion the power and scope of some companies overlaps with or even effectively supercedes government in some ways. To me these are demonstrations of the obsolescence of current government structures. The all-encompassing networks provided by these monopolies are extremely useful and I believe the main reason we tolerate them. They provide a platform. Decentralized technologies are becoming increasingly capable and popular. The only realistic alternatives to the giant monopoly companies are platforms built on decentralized technologies. I also suspect that for government to be able to keep up or be effective it also needs to be decentralized and possibly integrated in some way into the decentralized systems or metasystems.

rifung 8y ago

I work for Google, opinions are my own. Have there been any studies or anything on how having or breaking up large companies affects a country's competitiveness on a global scale? I feel like an extremely large company may be more competitive but this may come at the expense of other companies in the same or other industries. FWIW I personally agree with using antitrust to break up companies that don't harm consumers despite currently benefiting from the system.

ocdtrekkie 8y ago
I am not sure if fear of China is an adequate justification to allow rampant misconduct of a corporation here. Consider that we could just the same argue that having a minimum wage that's (still woefully inadequate, but higher than China) also significantly harms the competitiveness of our country's competitiveness in many industries on the global stage. It would probably be better to deal with issues of other country's power via trade agreements and political pressure.

kauffj 8y ago

Rather than trust busting, why not start with relaxing the federal laws which forbid the development of third-party applications? The limits on third-party apps are legal, not technical. It is not technically challenging to build an application that collects Facebook credentials and then presents alternative views and features. It could, for example, finally be possible to see a time-ordered view of your friends' posts (Facebook doesn't allow this since it reduces engagement). The development of such applications would serve as a threat and check on the market dominance of Facebook. A popular third-party application could consider adding its own features that Facebook does not have. It would also reduce Facebook's revenue. What stops this? In the US, it is primarily the CFAA (https://en.wikipedia.org/wiki/Computer_Fraud_and_Abuse_Act https://en.wikipedia.org/wiki/Computer_Fraud_and_Abuse_Act). Once Facebook formally tells a company to stop accessing their servers, they are in violation of federal law if they continue to do so. It seems premature to pursue trust busting action while we still have federal laws that encourage and cement the dominance of a single provider.

taurath 8y ago
Even if it were legal (which it should be IMO), I can't see anything other than a cat and mouse game happening where the primaries change their authentication patterns on a daily, hourly or minute to minute basis. Consider all the things that facebook does to mess with scrapers right now - every single letter in a div, multiples that are hidden, etc. Its a complete mess. "Forced open APIs" is an interesting idea in terms of actually bringing value to users - its almost on the level of nationalizing a company though in terms of being anti-business. Why Facebook would front the cost of running a service they can't monetize though is a big question.
- surrealize 8y ago
  Forcing open APIs isn't anti-business. It's pro-competition and pro-startup. The only thing it's anti- is big incumbents, which is the point.
  - taurath 8y ago

yonran 8y ago

The moat that each tech company owns is its network. Rather than trust-busting these companies up into their different businesses, I think it would promote more competition to impose network interoperability requirements once the network is entrenched for too long. A useful example is craigslist: a company with virtually no innovation for decades that still dominates the classified listings space. Other companies that try to offer a better experience face the hurdle of creating their own network or attempting to scrape craigslist’s items (and then being kicked off by their lawyers). What regulation would allow meaningful competition? A policy that requires craigslist to provide an API to competing firms for reading and writing at a reasonable price, and a requirement that changes to the network not favor craigslist vs. other firms.

kauffj 8y ago
You don't need new regulation; you just need to get rid of existing regulation. It is currently illegal to build third-party applications once the first party tells you to stop. Craigslist actually was involved in the court case that cemented this: https://en.wikipedia.org/wiki/Craigslist_Inc._v._3Taps_Inc https://en.wikipedia.org/wiki/Craigslist_Inc._v._3Taps_Inc.
- ucaetano 8y ago
  > It is currently illegal to build third-party applications once the first party tells you to stop. No, it is illegal to access the data of a third-party with your own app if that third-party doesn't allow you to do so.
- debacle 8y ago
  You're spreading a lot of disinformation in this thread around the CFAA.
- yonran 8y ago
  We could go back to the world where the AIM vs. MSN Messenger Chat Wars were legal (https://nplusonemag.com/issue-19/essays/chat-wars/ https://nplusonemag.com/issue-19/essays/chat-wars/). But reverse engineering APIs required an adversary with deep pockets, so I don’t think that is sufficient. We need an explicit regulation that a company’s monopoly over its network doesn’t last forever, just as patents are not forever.

pradn 8y ago

One complement/substitute for this approach is mandating open standards. If Facebook had to be part of the Fediverse or something like that. The standards could be managed by a third-party, something like the Federal Reserve for APIs. This way they can move to accommodate fast-moving changes and competition from companies in other countries.

tropo 8y ago

Will we ever again break up a monopoly? The attempt instantly becomes a political battle. The moment a politician takes sides, the other party opposes, and the initial politician's party backs him up. Politicians collect lots of money. There is then a highly politicized court case which the company drags out until there is a change of political power. Once political power changes, the government purposely sabotages their own case until the company wins.

gajeam 8y ago

Lot of people talking about third-party application development in this thread. It's also worth considering the opposite side of that, data portability. GDPR already requires companies allow users to easily export all their data [1], and if the US did the same it could really help mitigate the network effect social media companies use to hold onto their dominance (i.e. Facebook's properties) [1] https://gdpr-info.eu/art-20-gdpr/ https://gdpr-info.eu/art-20-gdpr/

dane-pgp 8y ago
Competitors to Facebook really need to be aware of the power of this law. In particular, it says: "The data subject shall have the right to ... transmit those data to another controller without hindrance from the controller to which the personal data have been provided, where ... the processing is carried out by automated means... [, and] shall have the right to have the personal data transmitted directly from one controller to another, where technically feasible." If the data transfer is automated and direct, then a Facebook user should be able to request that their posts on Facebook be continually synched over to their Mastodon account (for example). As Facebook is already a member of the Data Transfer Project [1], it would look very bad for them if they only allowed data to be automatically synched one way, especially if most Fediverse implementations supported two way synch. Of course, once your data is fully synched, you'd never need to actually browse Facebook itself again, and your friends on both Facebook and Mastodon would be able to read your Mastodon posts. (I suppose Facebook would similarly cite "data protection reasons" for why they can't synch your friend's Facebook posts out to you on another site, though). Anyway, I'm sure an EU anti-trust investigator would enjoy the opportunity to examine claims against a big US social media company like Facebook, especially if it were a small EU social media provider bringing the complaint. [1] https://datatransferproject.dev/ https://datatransferproject.dev/

LifeLiverTransp 8y ago

But the factors that grew this giant remains, meaning this will turn into a whack-the-mole where nothing changes but the name and owner of the company that reeincarnates the by nature centralized public service these companies provide. I would suggest a partially privat solution. Meaning. The public owns such projects, once the investment was returned. Sort of a lease from the allmende, that always returns -as rewards for the maintenance of investment. And any company can temporary (1 year max) own this infrastructure, once it contributes signifantly to it.

ufmace 8y ago

> Tarbell’s 19-part exposé on Rockefeller’s Standard Oil would mark a turning point in setting public sentiment against the trusts. Seems modern tech monopolies have it much better, with far more control over the information the public sees and can share with each other. Particularly when they start buying up newspapers. Whatever the practicalities of going against them in this way, that's going to cause complications.

cat199 8y ago

1) Doesn't seem so unsexy to me - though I havent gotten any in a while (actual trust busting that is) 2) If raising the issue, why start with these 2? Many bigger and much more entrenched fish in our sea

simplecomplex 8y ago

So, Google and Facebook suck up lots of personal information and some people don't like that. Splitting them apart wouldn't change their business models. Arbitrary destruction of their business doesn't do anything to protect consumer privacy. There's also nothing anti-competitive about either business. Using a different website is as simple as typing a URL into your web browser.

personjerry 8y ago

At the heart of the article, the assertion that the power of these corporations is threatening our government implies that this is a problem -- which in turn implies that government is somehow superior to corporations. Why is this necessarily true?

elefanten 8y ago
It doesn't have to imply that government is outright superior to corporations. It would be sufficient to imply that neither should have overwhelming power over the other.

Proven 8y ago

Answer to Google and FB for what exactly? People voluntarily use their products and services and no one has proven they're doing anything wrong. It's just a bunch of interventionists arguing the State ought to do something because that would benefit customers (http://web.stanford.edu/~gentzkow/research/facebook.pdf http://web.stanford.edu/~gentzkow/research/facebook.pdf indicates that FB delivers enormous benefits to users according to the users themselves while these legal activists don't offer anything except their unhappiness about how capitalism works). As much as I dislike the two companies, letting some activists randomly call shots based on their views on social justice and what ought to be better for certain people would be much worse. The issue is these activists can't see is that too much regulation and State meddling makes it harder for new competitors to arise. They're one of causes of less competitive markets, but they think they're the solution.

mark_l_watson 8y ago

That was a good read. Having made a good living from programming since the early 1970s, I would like to give something back, but other than creating content and software with sharing licenses, I am not sure how to proceed. I used to feel good about donating to EFF, ACLU, and FSF but I have reduced my donations because I don’t feel like they are doing much good. I have read Tim Wu in the past and although he helps us understand the power dynamics of monopolies and controlling platforms, I don’t really get any actionable suggestions from him. Same could be said for this article: a good read, but left me wondering what, if anything, I can do to help.

sabalaba 8y ago

Surprised that HN has this sort of myopia in tech history. Are things really different this time? Standard Oil, U.S. Steel, Bell, IBM, Microsoft, AOL Time Warner. Cries for antitrust action are often a bellwether for organic disruption. A lot of the discussion here is about how to "organically" break the trust via regulatory changes such as repealing CFAA, more scrutiny around acquisitions, etc. It's not possible to understand the first order effects (let alone second and above) of regulation. Doing so without using the mighty/crude hammer of antitrust would presume that one knew how to organically disrupt these companies. "Oh! If only other people were to prevent Google from making all of these acquisitions we would have more competition in search!" "If only small companies could build 'third-party apps' legally!" Once you substitute out the ever-wise HN commenter with a member of our legislature does the absurdity of these statements become clear. Can we at least have the humility to say that we don't know how to disrupt these companies? There is already a massive profit incentive in the form of the net profits to be competed for. The answer to the question "How do you beat Google?" is for the market to answer. Before trying to come up with a regulatory solution, it's worth stepping back and realizing that if you knew exactly how to beat Google, you'd hopefully try and do it.

fouc 8y ago

Trust-Busting implies that we have to go out of our way to identify and bust monopolies every 10-20 years. That's the wrong fix here. Instead we should focus on finding alternative solutions that reduce the tendency to form these huge corporations or conglomerations. And encourage more companies/competition.