I come to praise the titans of tech, not bury them.
That's right, I've got good things to say and I want to tell you how ridiculous these House antitrust hearings are given that the four companies on the hot seats, Alphabet (GOOGL) , Amazon (AMZN) , Apple (AAPL) and Facebook (FB) , are actually about the best thing we have going for us in a country where our hegemony and our very sovereignty at times seem completely in doubt.
We know the hearings are wide-ranging because the challenges to the titans are so dissimilar: Amazon allegedly abuses its market power against those who sell products on their sites, Apple's app store is too powerful versus those that would have their own apps, which can't be successful without the app store, Facebook dominates social media and Alphabet dominates search.
I want to put aside for a second the real issues facing our country, ones of a runaway pandemic that is decimating all sorts of industry, of vast polarization that makes political unity an impossibility and destabilizing racial inequality that is challenging the whole nature of underclass, opportunity and education.
These hearings seem to have more of a prurient nature. Just a great opportunity to hold rich peoples' feet to the fire. I say that because at a time when so many of our companies have sold their soul to the Chinese, with whom we are now at a cold war with, these companies have not done so, not that the Justice Department's Bill Barr seems to know that as he has singled them out as bad actors even as the only one with substantial ties to China is Apple, which is basically a Fifth Column for America in the PRC.
So I want to go the other way. I want to talk about what they have done, about how they have allowed our country to dominate in a sunsetting era of American dominance, chiefly at the hands of the Chinese.
First, Amazon. We may bemoan how much power Amazon has over third party retailers but the fact is that retailers themselves can walk to Google Cloud or Microsoft's Azure. There was a time when Amazon had it all to themselves. But the other companies wrecked their monopoly. The real tell that the long knives shouldn't be out? Amazon is still picking up share of retailers even after the other two companies have chosen to compete. What you won't hear today? How Amazon has kept prices down while allowing people to feed and clothe themselves in a shelter at home era. It's saving lives.
Alphabet owns search for certain. But every year it seems that its search power goes down in value which is what we will hear again on its call this Thursday. What they don't like in Washington is Google's power. What they don't like on Wall Street is Google's lack of power. Anyway, Amazon has come into the ad market hard. Google can change its algorithm and I don't think that's all that fair. I do believe they are too secretive. But they do it to keep companies from gaming them which ruins the user experience. Google uses its ample profits to fund bets on health care, mobility and artificial intelligence. If you hobble them, another country will take over.
I think when we are appalled at the power of the Chinese-based TikTok, it's not the time to hobble its chief rival, Facebook. The notion that it dominates social media is a little ridiculous given one, that it created it and, two, it isn't like anyone else could have bought Instagram. It's the opposite: in retrospect I think Instagram regrets that it took Facebook's money but it didn't need to sell. What won't come up? How Instagram Shops are the single greatest job creator during the pandemic. It's also the cheapest way to reach new customers in your area.
Best for last: Apple. Let's face it, we would be using Chinese phones if it weren't for Apple. The App store has created more than two million jobs. Is it predatory? Hardly. In fact in return for a good chunk of your profits it, at least, enables you to have profits. What won't be said? Most sites, most companies that need subscriptions, are foolish not to pay the vig to Apple. It's a cheap way to stay in business.
I don't care about your politics. I don't care about your fears of concentration. I care about what's left of American success in a globalized economic world. The House should have included Microsoft (MSFT) . It's the only other company out there that's keeping us from being dominated by the Chinese in pretty much every endeavor that matters in a 21st century economy.