Mossberg: Tech’s ruling class casts a big shadow

“What we have now in consumer tech, in 2017, is an oligopoly, at least superficially similar to the old industrial-era American corporate groups that once dominated key industries,” Walt Mossberg writes for The Verge.

“To be clear, I’m not alleging that the Gang of Five [Apple, Amazon, Google, Facebook, and Microsoft] is colluding with each other to fix prices, or to actively suppress innovation; or to do anything illegal,” Mossberg writes. “But I do think that their enduring and growing power casts a shadow over the Silicon Valley legend that there are lots of great new consumer tech innovations being incubated right now in garages or dorm rooms somewhere that will be taken all the way to becoming great companies, the way each of the Gang of Five was.”

“What I fear is more likely to happen to any such startup is that, if they’re good, they get acquired by a member of the Gang, or that their idea is turned into a feature for one of the Gang’s products,” Mossberg writes. “I’m a fan of all the Gang members.. [but] ultimately, I don’t think even a five-company platform oligopoly is good for consumer tech. By its very nature, it handicaps independent companies with new ideas. But it will end one day.”

Read more in the full article here.

MacDailyNews Take: Yes, it will end someday. In fact, for Microsoft, it effectively already has. For Facebook, it could end in a flash (sort of like Flash) at any time. But the true “Big Three” — Apple, Google, and Amazon — will be here, dominating markets far and wide for many, many years – save for government intervention at some point for any or all of them.

30 Comments

  1. Ha! This is exactly was I just wrote on the Right to Repair thread. You can’t let the market decide everything unless you like the idea of the market turning into one giant monopoly or oligopoly.

    I think Mossberg’s warning is fair for those who like choice in their “democracy.”

    Without choice, it’s not much of a democracy. Sometimes government intervention protecting choice is a good thing.

    1. We have choice now. We can buy a Dell computer and a Motorola phone and stay off Facebook and shop at actual stores and use Linux. We are not forced to use Apple, Amazon, etc. And entrepeneurs are free to create alternatives that are better. Bill Gates refused an offer to sell his software to IBM. New innovators can do the same thing. The last thing we need is the government getting in the way, like it has done in health care and energy and banking. It screws up every single thing it touches. Let America be free.

      1. For anyone committed to the Mac platform, with tens of thousands of dollars invested in hardware and software, and decades of time spent leaning how to play, that’s not much of a choice. It’s like saying that all of those years you spent learning and paying to learn German at University, will now be spent learning Chinese. It’s not like the preference for blue over red. It’s an entire culture and ecosystem that you’re invested in and want to stay with.

        It’s like when people say, “Hey, you don’t like this law? Well then move to Pago Pago!”

        It’s not really the point of working to change something that doesn’t feel fair.

        You are right that government intervention in many things gets messy, sloppy, bureaucratic and worse. But it’s not all black and white. This is not a binary system of thought or philosophy.

        Sometimes we need laws to protect us as workers, consumers, and people in search of life, liberty and some happiness on occasion too.

          1. Clean air, clean water, usda food inspection, drug inspection and approval, gasoline flammability containment standards, road standard construction, earthquake building codes, general building codes, osha, I could go on. But these are just a few of the “laws from Washington politicians” that make your life livable…

            Not all regulations are bad, some are completely necessary. The market is a wonderful thing but we have to be realistic about what it can and cannot effectively do. The market cannot effectively self regulate in many industries, so there needs to be rules. Even simple basic ones.

          2. Well, believe it or not, some issues are universal in nature and need one consistent set of rules.

            Imagine having a different set of rules for the game of football in each of the 50 states. Do you think the NFL would be successful? No. You’d have confused players and fans.

            Consumers and companies alike prefer consistency. Patchworks of local ordinances are more troublesome than clear federal regs. And we definitely need laws to restrain the many businesses that have repeatedly demonstrated that they have little or no ethics.

      2. Okay, fair enough. But what technologies, pray tell, do you run on that Dell or Motorola? I’d be willing to wager you are roped into at least one of these companies’ offerings, and by default. Whether you like it or not, sometimes regulations are a necessity, and Silicon Valley has gone on with virtually zero regulation for far, far too long.

  2. I tried to post a link to a blog post at OWC, but I guess MDN won’t let me. Just Google the OWC article by Larry with the title “OWC DIYs Won’t Void Your Mac’s Warranty” There is some really interesting legal information there concerning what Apple can and cannot do (as regards the built in consumer protection owed to the Magnuson-Moss Warranty Act of 1975).

    [I don’t have any affiliation with OWC other than buying Apple proprietary SSDs and other Mac hardware there over the years. The hard drives are great, the hard drive sleds?… meh…]

    1. Indeed, what we think of as “Successful Startups” is Microsoft and Apple.

      First, tell me of the successful startups in 1917 who are still in business?

      But what about someone who just creates a product big enough to support his & his employees families? These companies don’t register on hardly anyone’s radar. They “use technology” one way or another & usually many ways and likely must use a lot of modern technology to let a small group of people create a viable ongoing business.

      Sometimes the only way a founder or set of investors can actually profit from their work is to sell. There is no other way for them. Why? The capital to expand nationwide is impossible for them to get by loans. Taking on investors to expand nationwide can easily wind up with the investors taking over total control of the company with the founders bounced out with very little and sometimes any payment only occurs once the company sells itself to someone else.

      Articles like Mossberg writes are aimed at the “1%” or more likely the “0.0001%” The rest of the world lives in real world improvements or products for things like like bicycles, camping, sports, home and hobby equipment, supplies and yes, even Amazon supplied books.

  3. Microsoft’s OS still blankets the globe as far as the desktop. Still over 90%. I wouldn’t exactly call them irrelevant, but the Mac has been doing moderately better against it. Apple is a one trick pony right now with everything revolving around the iPhone. With the deluge of criticism after the MacBook Pro they’ve seen how easily people, even those of us invested since 1984, can switch to other platforms. Facebook is rather pointless. It provides no discernible service except for mass distribution of fake news memes, animal pictures, and ads. People can easily live without it. Android is rapidly becoming the dominant OS of all, but when phones start blowing up, people switch.

    No one is stuck we these platforms.

  4. Its only going to ‘end’ for these businesses if, as and when others take over their positions. The general process is unlikely to change in any foreseeable future, its the natural process of capitalism, the powerful wish to bend the freedoms to benefit themselves whilst excluding others from the club through protectionism which then becomes the most focused part of their business. The only restrictions upon it are interventions by Government which certainly isn’t going to happen any time soon under the present regime or indeed generally in the unfettered system generally unless one or more of them get far too arrogant in their abuse of market power.

    1. Once a business becomes immense, it is more likely to come to and end for reasons that have little to do with the way the company operates.

      History shows us that growing and trading sugar or cotton was immensely profitable at one time. Steam trains were once regarded as the future, but railways have long been superseded. Ocean liners and then aircraft were showcases for major nations, but now even emergent nations operate fleets of modern aircraft. Oil was a massive industry, but is now having to fight for it’s future as other energy forms become more widely available.

      Inevitably big companies will have their day and will at some point fade away. It applies equally to finance, energy, pharma and car manufacturing as it does to tech. It won’t necessarily be a case of rival companies taking over their positions, but of their underlying business no longer being as relevant as it once used to be.

      Protectionism as government level won’t make any difference in the long term and neither will aggressive actions or underhand by the companies themselves. If the product is in demand and people are willing to pay a sensible price for it, then that business will continue. Take away the demand or the profit and the business will eventually disappear.

      It’s not inevitable that startups will always be bought out by the big companies. Some of the big players in the tech world are fairly new companies. They still managed to find their feet in a crowded market and others will do so in the future. It’s not so long ago that WordPerfect, VisiCalc, Lotus 1-2-3 or dBase were regarded as ubiquitous in our offices.

      1. Of the big five, Amazon is the most susceptible to a downturn in the world economy, which is likely the biggest potential danger. It has no cash hoard to smooth the effects of such a scenario and an insane valuation.

    2. I completely agree. If we value freedom, democracy, and even capitalism, we must be vigilant and realize that the government that we elect to be our voice is the ONLY entity large enough to stand up to these powerful multi-nationals.

      All government intervention is not bad.

  5. well, i guess we will have to see how this all plays out over time, but we better do it with our eyes wide open.

    for a while now i have been growing a bit uneasy with the way tech companies seem compelled to get their fingers into everything damn thing. amazon starts with retail and moves into space travel, as one example. there are many others (no amazon did not start as a tech company, but it wasted no time moving into tablets, siri like assistants and the like. so they are now)

    couple this trend with how vital technology has become to our everyday lives and how these companies mine our online activities for ways to monetize our lives, collecting and collating every bit of data they can get their hands on or hoover up.

    not to mention sneaky ass moves like samsung and the ability to monitor our lives through our tv monitor cameras.

    modern technology and big data is rapidly gaining the capability to deny us the merest shreds of privacy. not a good trend

    capitalism isn’t necessarily a bad thing, but without oversight and monitoring – and regulation when necessary – it can turn into a predatory mechanism for those powered by greed and acquisitiveness, leading to the acquisition of great power into very few hands – also not a good trend.

    we need to be vigilant, or we risk having technologies and technology companies that are conveniences to us and serve us turning the tables and we becoming our masters.

    1. nuts, the dangers of writing before the coffee has kicked in.

      ….and not proof reading.

      second para should say everydamn thing

      last para should say and become our masters.

      pardon the illiteracy.

  6. Trump Schedule || Thursday, March 9, 2017

    10:30 am || Receives his daily intelligence briefing

    11:00 am || Meets with CEOs of small and community banks; Roosevelt Room

    12:30 pm || Hosts a legislative strategy session on the budget; Roosevelt Room

    2:00 pm || Meets with former Secretary of Commerce Pete Peterson

    3:00 pm || Meets with Secretary of Homeland Security John Kelly and Director of the CIA Mike Pompeo

    4:00 pm || Makes remarks to the Senate Youth Program; East Room

    All times Eastern

    *******************************

    The Clot’s Schedule || Thursday, March 9, 2017

    10:30 am || Opens first quart of Chivas Regal of day.

    11:00 am || Meets with squirrels in woods.

    12:30 pm || Hosts leaves and sticks for “I’m With Her” rally.

    2:00 pm || Calls George Soros to reminisce about the Good Old Days.

    3:00 pm || Takes nap.

    4:00 pm || Opens second quart of Chivas Regal.

    All times Eastern

    1. Yeah, ol’ Chump receives his daily intelligence briefing, that has to be no longer than 1 page and have no more than 9 bullet points.

      Gotta have time for hour-long meeting with TMZ and golf.

    2. And on Wednesday March 8, Trump met with Laurene Powell Jobs at 11:00 AM. The White House is always open to billionaires.

      Why are the American people paying Trump a full salary when he only shows up for 6 hours per day?

      Actually, many of us are more concerned about the schedule of the unelected shadow president, Steve Bannon. Or Adolf Bannon, as his friends call him.

      The worst part of the current administration dog & pony show is that real work isn’t getting done at all. Trump isn’t doing the basic job of hiring people to run critical functions of the US Government that everyone, even the most extreme right wing anti government hacks, agree must be done. According to Partnership for Public Service, of 549 key appointments, the White House has yet to name 515. Only 3 Ambassadors have been named.

      Asked specifically why over 4000 sub-cabinet level posts are vacant, Trump claims that “we don’t want to fill those jobs”.

      This is absolutely stupid for a businessman or an administrator. If you are trying to make any organization more effective or less costly, you don’t chop off the heads of your departments. You assess your mission and goals and have trusted heads of departments reorganize the departments to fit the size of the mission. Nothing good is going to come from this administration’s incompetence.

  7. Things do change all the time, Apple is big, and they’ve got lots of cash, they are routinely attacked by media that in most case, are dumber than rocks, that have no clue what they are talking about, but it sounds good to them…

    People say that the last Macbook Pro was a dud, and for those that have used Mac’s for ages, many wish it had some other features.. But many of the features is has are the wave of the future.. not the past.. If you believe some of the reports, it sold quite well. Even though many here and other Mac related sites trashed it, whether you chose to believe it, there are millions of other people that have never read one of these Mac sites and have owned Mac’s for ages and may really like the new Mac Pro.

    Apple though because of its size, does things more glacially now, and are looking at data we have no access to. Many want a new Mac Pro, this again is a online phenomena, people that read Mac sites and read Mac or tech pundits are probably not a majority of users. Apple in the last Mac Pro, tried to create the next generation of the “Cube”, and perhaps it looks pretty, and perhaps for that moment in time, it was fast and performed well, but off course things for the moment are getting faster and without any upgradability, gets left behind.

    I am also waiting to see what happens when Apple deep green initiatives start causing issues.. What happens when those solar panels start having issues at Apple Park, How easy are they to replace? What happens if a storm of some sort comes through and drops large hail are they truly impervious to damage?

    Some can think Oil has had its day, as someone noted, but solar and wind are still not going to replace oil any decade soon.. They too have green short comings, Wind farms kill thousands of birds each year, and they are a blight on the landscape as far as I am concerned. Solar power requires covering acres and acres of land as well, to create enough power for small cities if that, and if you want to be honest, the cost of running them are exorbitant. Because they only work when the sun is shining, when its not, they have to use natural gas or some other heat source to keep the place operating.

    Facebook eventually will probably take a hit as more people realize that it passes time, but its not worth it. MS continues to create its own tomb with perpetual security issues and making things increasingly more difficult to use or manage.. Despite their marketing hype.. Amazon will peak at some point, time will tell, always does.

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