Editor’s Note: Dipayan Ghosh is author of “Terms of Disservice: How Silicon Valley is Destructive by Design.” He is co-director of the Digital Platforms & Democracy Project at the Harvard Kennedy School and served as a policy executive at Facebook and prior, as an economic adviser in the Obama White House. The opinions expressed in this commentary are those of the author; view more opinion at CNN.
Has Silicon Valley gotten too big?
It’s a running theme these days: That big tech is has become overly powerful, that Facebook and Google regulate speech on their respective platforms, that Apple and Amazon misuse their monopoly power. But what – exactly – does all of this mean? Why should we care even if big tech has gotten too big?
These are the questions that the House Judiciary Committee will have to get to the bottom of when it hosts its Wednesday hearing featuring the CEOs of those four companies – arguably, the four most powerful business executives in the United States, let alone the tech industry.
It is a unique opportunity: Never before have we had such a vaunted occasion featuring the tech industry’s barons all testifying together – and this will indeed be Jeff Bezos’ first appearance before Congress.
The stakes are high – for the industry, yes, but especially for the American consumer.
But why does a topic as dry as platform dominance, as the House Judiciary Committee puts it, matter so much to ordinary Americans?
After all, Americans love their tech – and many of us couldn’t live or work without an always steady, high-speed internet connection. We love scrolling our Facebook and Instagram feeds – and especially appreciate the latter’s artistic simplicity. Many of us have relied on Amazon Fresh for grocery deliveries during (and long before) the Covid-19 pandemic. The iPhone is possibly the most beautiful widely available consumer device. And I’ll admit – I’ll quite often spend hours on YouTube catching up on politics and sports.
But as Silicon Valley tightens its stranglehold on the digital media environment every year – especially so in 2020 as we have relied ever more on technology to help stay connected through the coronavirus outbreak – the silent danger of the domination over digital media achieved by these four firms looms large.
It is a complex problem. These companies are each “monopolies” in their own respective rights, with Facebook, Google and Amazon possessing shares of at least half of the overall market in social media, internet search and online book sales respectively. Developers have meanwhile accused the App Store, available through Apple’s closed iOS, of being a monopoly. Each company is vitally important in today’s media environment.
But it is one thing to possess a monopoly and quite another to cause harm based off of the market power afforded through that monopoly position.
I see three broad public interest areas in which the big four firms should present serious concern to every American – and indeed could implicate the national economy in various ways if nothing is done to rein in their market power: Consumer prices, quality of services rendered and innovation in the marketplace.
Price. According to former Google CEO Eric Schmidt, the search engine is famously “free.” He is right that we don’t have to pay any money to Google to start up an account and search the corpus or start down the YouTube rabbit hole. But what happens when a single company dominates internet searches, and controls access to influence the people who use its monopoly platforms through the bottleneck of Google’s advertising regime?
Put another way: could it be that Google is systematically extracting wealth from us in the form of a novel currency that is the complex combination of our data and attention – and leasing that exploitatively raked information and attention out to marketers at ever-rising rates? Could something similar be happening with Facebook’s monopolization of social media and web-based text messaging, or Amazon’s tremendous power in e-commerce, or in the App Store, through which Apple rakes 30% of app revenues?
Quality. It’s no surprise that parts of today’s media ecosystem have become completely polarized and replete with offensive content. The Russian disinformation problem, the spread of hateful conduct online, engagement in violence and digital extremism, the prevalence of algorithmic discrimination – these and other concerns with social media have triggered the #StopHateForProfit campaign among other efforts undertaken by civil rights advocates.
Part of the problem, regrettably, is a lack of sufficient financial incentive (though the Facebook ad boycott may change that should it gather enough steam) to address the offensive-speech problem.
Innovation. As some have argued, Apple has a monopoly in the closed-system device market; it controls the consumer value chain, from the physical device technology, to the pre-installed iOS operating system, to the core mobile applications and services that run atop it all – and there is no other closed-system provider that does it so compellingly. This stranglehold, and the capacity to collect large amounts of personal and proprietary information across it, has meant Apple has consistently been able to give its own products a position of privilege in contexts like the App Store – allegations similar to those that Amazon has had to deal with. This necessarily diminishes any chance for competition in the iOS app market – let alone the overall closed-system market. And that leaves aside the fact that Apple (and Android) heavily rake in revenues appreciated out of their respective app stores.
It’s a circumstance that kills the incentive for members of the industry and entrepreneurs to develop new features and web technologies for us to interact and engage with – and severely diminishes the progress of vibrancy and dynamism across the internet.
These are the negative impacts that we – as everyday users of the internet – are experiencing. And yet, we don’t feel them. We don’t feel our pockets getting lighter, or the pace of digital innovation slowing gradually, and many users aren’t even subjected to the racism, bigotry, hatred and conspiracy-peddling that’s become the norm for some of us – particularly, marginalized communities. But the fact that we don’t feel these harms doesn’t mean they’re not happening – and the silent nature of the damage they do should be most concerning of all.
The Judiciary Committee must probe into these issues: It must ask the questions necessary to build evidence that can point to the harms that Big Tech has done in the realms of prices rendered to consumers, market innovation and quality of service.
And beyond these issues, there is yet another looming danger: Increasingly, these companies are showing features of not only being monopolies, but natural monopolies. We cannot imagine an alternative to them anymore. Barriers to entry are too high given the physical and digital infrastructures these companies have built up to protect their market positions.
They ride a powerful network effect, whereby as more and more users join their networks they become economically ever more powerful. In time, we cannot imagine societal investment in an alternative; why build a second railroad, or electric network, or telephone line – or, indeed, social media network – when you have one that “works”?
These are the issues Congress must break down for Americans – and if we can successfully do so, we’ll finally make headway down the long road of rebalancing power in the media ecosystem from Silicon Valley to the rest of society.