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Breaking up big tech companies is undoubtedly good for the workers, create more competition in hiring. It would probably send money downwards and be a huge boon

Breaking up big tech companies is undoubtedly good for the workers, create more competition in hiring. It would probably send money downwards and be a huge boon to innovation tbh.

skybrian 7y ago
Well, maybe. But on the other hand, the biggest tech companies seem to pay the most? Why is that?
- twobat 7y ago
  At least in my region (Eastern Europe) the question is: why is it that the smaller companies can't pay a living wage?
  - Viliam1234 7y ago
    I have a mathematical model that would explain this behavior, but I have no idea how much it corresponds to reality. Imagine that there is a psychological line that most bosses want to reach, for example "to become a millionaire". This desire is the same whether you live in a richer or poorer country, and whether you have twenty or two thousand employees. The word "millionaire" is simply a magical word which does not automatically adjust to e.g. "3.2-million-aire" just because you have more employees or live in a different country. Also, "millionaire" these days in Eastern Europe refers to million euro, just like in Western Europe, and not much different from million dollars in USA, i.e. it is country-independent. Now if we assume that the million is a fixed psychological goal, this is easier to reach in a large company than in a small one. If you have two thousand employees, you need to make 500 euro per employee. If you are okay with becoming a millionaire in five years, that's 100 euro per employee per year, which is barely noticable. But if you have twenty employees, during five years it makes 10 000 euro per employee per year. They are going to feel that. (Also, the higher the costs and average salaries in a country, the less the employees will feel those 100 or 10 000 euro per year.) According to this model, employees in small companies in Eastern Europe should be paid very little. But their bosses should still become rich.
- cartoonworld 7y ago
  Incumbents have the financial scale. Also, if you need the best database developer, they might find their own lucrative vertical and/or disruptive passion project. It makes great sense to counter the potentially hypertensive corporate rigamarole with a fat paycheck. Similarly, if it would have convinced Elon Musk to forget about this EV thing and take a well funded engineering department at Daimler, well that might've felt like winning the hiring lottery.
- treis 7y ago
  Say you write some code that increases conversions by 0.01%. Thats worth 10 bucks to momandpop.com compared with millions to Amazon. No wonder that programmers can make more at Amazon.
  - tdhoot 7y ago
    Analogy doesn't really hold up. Increasing conversions by 0.01% probably takes an hour at momandpop.com and maybe a year or more at Amazon. Not to mention low-hanging fruit already being picked at large corps.
    - sidibe 7y ago
      A lot of things at big companies aren't ever going to be worth doing at little companies. In cloud companies they spend tens of millions of dollars going after 1-2% efficiency gains that really make a big difference when many of these little gains are all stacked and applied to billions of dollars of equipment. Maybe if these companies got broken up, several little companies could sell these little gains, but that seems much less likely than one of the broken up companies naturally becoming big again and doing it themselves. This field has a ton of natural incentives to scale as big as possible. I feel like the main beneficiaries of breaking up big tech companies are business people and lawyers getting to insert themselves everywhere to interface between groups that used to be the same company.
    - treis 7y ago
      I think you've proved my point. Working for momandpop.com produces value at $10 an hour. Working for Amazon and assuming 2000 working hours in a year produces value at $500 an hour. And that's if that 0.01% improvement is worth only one million dollars.
- dilyevsky 7y ago
  Because nobody would work there otherwise (edit: given the choice ofc).
friedman23 7y ago
> Breaking up big tech companies is undoubtedly good for the workers, create more competition in hiring. Many of the largest tech companies are only large because of their cost centers. If we split up google what would likely happen is that youtube and gmail would simply die.
- goatinaboat 7y ago
  If we split up google what would likely happen is that youtube and gmail would simply die Or compete on a level playing field with Vimeo, Fastmail and so on. Everyone wins if Google is split up. Even Google shareholders, who will finally get some nice dividends when the ad business money isn't being diverted to prop up the rest of it.
  - mrep 7y ago
    Google recently announced a 25 billion dollar stock buyback so investors are definitely getting some returns. Also, I'm pretty sure most investors are happy with their investments in waymo considering it has been valued by some analysts at over a hundred billion dollars despite not making any revenue yet as far as I know and I've read they have invested over 5 billion dollars into it which is pretty much out of the realm of what even SoftBank would invest in a company with no revenue yet.
tracer4201 7y ago
Big tech companies are able to try 100 things out instead of 1 because they can rely on their stable revenue streams to pay the bills. I’m not sure how it would be a boon to innovation but am open to learning why you think that. The major damage big tech is doing is in my opinion dodging regulations or inventing business streams that have no regulation, moving as fast as possible to get a solid footing, and then asking the government to regulate them. Therefore, they lock the smaller guys out. Therefore, there’s little to no competition.
- kaibee 7y ago
  > Big tech companies are able to try 100 things out instead of 1 because they can rely on their stable revenue streams to pay the bills. I’m not sure how it would be a boon to innovation but am open to learning why you think that. Is Apple trying 100 things out or are they hoarding insane amounts of cash in Ireland?
  - tracer4201 7y ago
    Sure, but on the other hand, you have FB, Amazon, Google, Microsoft. Look at all the things these companies are involved in.

Breaking up big tech companies is undoubtedly good for the workers, create more competition in hiring. It would probably send money downwards and be a huge boon to innovation tbh.

skybrian 7y ago

Well, maybe. But on the other hand, the biggest tech companies seem to pay the most? Why is that?

twobat 7y ago
At least in my region (Eastern Europe) the question is: why is it that the smaller companies can't pay a living wage?
- Viliam1234 7y ago
  I have a mathematical model that would explain this behavior, but I have no idea how much it corresponds to reality. Imagine that there is a psychological line that most bosses want to reach, for example "to become a millionaire". This desire is the same whether you live in a richer or poorer country, and whether you have twenty or two thousand employees. The word "millionaire" is simply a magical word which does not automatically adjust to e.g. "3.2-million-aire" just because you have more employees or live in a different country. Also, "millionaire" these days in Eastern Europe refers to million euro, just like in Western Europe, and not much different from million dollars in USA, i.e. it is country-independent. Now if we assume that the million is a fixed psychological goal, this is easier to reach in a large company than in a small one. If you have two thousand employees, you need to make 500 euro per employee. If you are okay with becoming a millionaire in five years, that's 100 euro per employee per year, which is barely noticable. But if you have twenty employees, during five years it makes 10 000 euro per employee per year. They are going to feel that. (Also, the higher the costs and average salaries in a country, the less the employees will feel those 100 or 10 000 euro per year.) According to this model, employees in small companies in Eastern Europe should be paid very little. But their bosses should still become rich.
cartoonworld 7y ago
Incumbents have the financial scale. Also, if you need the best database developer, they might find their own lucrative vertical and/or disruptive passion project. It makes great sense to counter the potentially hypertensive corporate rigamarole with a fat paycheck. Similarly, if it would have convinced Elon Musk to forget about this EV thing and take a well funded engineering department at Daimler, well that might've felt like winning the hiring lottery.
treis 7y ago
Say you write some code that increases conversions by 0.01%. Thats worth 10 bucks to momandpop.com compared with millions to Amazon. No wonder that programmers can make more at Amazon.
- tdhoot 7y ago
  Analogy doesn't really hold up. Increasing conversions by 0.01% probably takes an hour at momandpop.com and maybe a year or more at Amazon. Not to mention low-hanging fruit already being picked at large corps.
  - sidibe 7y ago
    A lot of things at big companies aren't ever going to be worth doing at little companies. In cloud companies they spend tens of millions of dollars going after 1-2% efficiency gains that really make a big difference when many of these little gains are all stacked and applied to billions of dollars of equipment. Maybe if these companies got broken up, several little companies could sell these little gains, but that seems much less likely than one of the broken up companies naturally becoming big again and doing it themselves. This field has a ton of natural incentives to scale as big as possible. I feel like the main beneficiaries of breaking up big tech companies are business people and lawyers getting to insert themselves everywhere to interface between groups that used to be the same company.
  - treis 7y ago
    I think you've proved my point. Working for momandpop.com produces value at $10 an hour. Working for Amazon and assuming 2000 working hours in a year produces value at $500 an hour. And that's if that 0.01% improvement is worth only one million dollars.
dilyevsky 7y ago
Because nobody would work there otherwise (edit: given the choice ofc).

friedman23 7y ago

> Breaking up big tech companies is undoubtedly good for the workers, create more competition in hiring. Many of the largest tech companies are only large because of their cost centers. If we split up google what would likely happen is that youtube and gmail would simply die.

goatinaboat 7y ago
If we split up google what would likely happen is that youtube and gmail would simply die Or compete on a level playing field with Vimeo, Fastmail and so on. Everyone wins if Google is split up. Even Google shareholders, who will finally get some nice dividends when the ad business money isn't being diverted to prop up the rest of it.
- mrep 7y ago
  Google recently announced a 25 billion dollar stock buyback so investors are definitely getting some returns. Also, I'm pretty sure most investors are happy with their investments in waymo considering it has been valued by some analysts at over a hundred billion dollars despite not making any revenue yet as far as I know and I've read they have invested over 5 billion dollars into it which is pretty much out of the realm of what even SoftBank would invest in a company with no revenue yet.

tracer4201 7y ago

Big tech companies are able to try 100 things out instead of 1 because they can rely on their stable revenue streams to pay the bills. I’m not sure how it would be a boon to innovation but am open to learning why you think that. The major damage big tech is doing is in my opinion dodging regulations or inventing business streams that have no regulation, moving as fast as possible to get a solid footing, and then asking the government to regulate them. Therefore, they lock the smaller guys out. Therefore, there’s little to no competition.

kaibee 7y ago
> Big tech companies are able to try 100 things out instead of 1 because they can rely on their stable revenue streams to pay the bills. I’m not sure how it would be a boon to innovation but am open to learning why you think that. Is Apple trying 100 things out or are they hoarding insane amounts of cash in Ireland?
- tracer4201 7y ago
  Sure, but on the other hand, you have FB, Amazon, Google, Microsoft. Look at all the things these companies are involved in.