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Define "better off". Companies like Meta and Google are enormous behemoths that make their money through advertising. One advantage of their size is that they h
by matthewdgreen 11mo ago
Define "better off". Companies like Meta and Google are enormous behemoths that make their money through advertising. One advantage of their size is that they have lower costs, but a greater advantage is that they have much larger market power: they can purchase competitors and demand higher rents for advertising space. Is society genuinely better off from this kind of concentrated market advantage? One might argue that there are different kinds of 'efficiency' at play here, and not all of them are in society's interest.
- meowface 11mo agoThis would allow direct, constant competition between companies like Meta/Google and their Chinese counterparts. Americans could choose to use Chinese providers when they're outcompeting the American behemoths, and vice versa. We see that China's companies are very competitive and innovative. Both American and Chinese citizens might be better off if they all could freely choose from different global options.
- matthewdgreen 11mo agoBut that's not at all how things have worked out, even here within the US. Waze does not compete with Google Maps. WhatsApp and Instagram do compete with Facebook, each of these companies were simply acquired. We've learned that new social media companies have a very hard time spinning up the network effects required to make them prominent, and in the rare cases they do, they quickly get bought out or their products cloned by incumbents. There's an excellent chance this would have happened in China without state intervention. The most prominent recent exception to this rule is TikTok, which spun out of an already-successful Chinese tech company. Its owners resisted acquisition until legislation forced their hand.