Last week Robert Reich, economist and former Clinton Cabinet official, raised a stir with a New York Times piece calling for a break-up of “Big Tech.” His point is that the digital platforms of companies such as Google, Amazon and Facebook have become so vital and market dominant that their power is dangerous if left unchecked.
Silicon Valley is quick to disagree, and on the merits they have good points. But those points won’t matter if the Americans start to view these digital platforms as the problem instead of the solution.
And there is already evidence that many are already thinking that way. A Vrge Analytics survey completed this weekend found that many Americans expect that digital platforms such as Facebook, Apple and Twitter will become regulated like a utility. Only 1 in 5 Americans think that as private companies they will avoid being regulated. Forty-three percent said they are likely to be regulated, while 28 percent said it‘s “too early to tell it probably depends on how they operate and behave.”
Only 1 in 5 Americans think that as private companies they will avoid being regulated.
And another data point: Americans are questioning the motives for the latest technology innovations. When the Internet was first emerging, the narrative was around empowering people and connecting those in need.
But according to the Vrge Analytics survey, more Americans think that technology is focused on making the “lives of the rich easier and better” (43 percent) than “bridging the gap between the rich and the poor” (35 percent). That is especially true among 18-24 year olds, with 52 percent of them saying that technology is being built for the needs of the rich.
We are entering into an Era of Digital Platforms that goes well beyond Facebook, Apple or Google. Uber or its successor will be a platform to meet any demand with a service – whether it’s transportation, finding a plumber or hiring a batting coach for your son’s little league team. Bitcoin (or its successor) may well become a platform used for voting.
The value of these platforms cannot be overstated: they allow entrepreneurs to quickly create companies because the start-up costs are so minimal when you can simply plug into an existing platform.
It’s transformational to the economy and ultimately society.
But with transformation and disruption come angst, policy fears and business conflicts. If “Big Tech” – and the small start-ups upending markets today – don’t effectively navigate the big issues that society has, then regulators, lawmakers and other policy makers will do it for them.
To a degree these transformational companies get this: that is why you see so many ex-Obama advisers and other political strategists moving to Silicon Valley to help these companies avoid mistakes.
But technology has reached a point it’s not just about tech companies. Every company now is – or wants to – leverage the Big Data and analytics that advanced technology is enabling. And that creates a myriad of issues that they must confront early, and smartly.
And start-ups that want to upend the status quo never have to worry about policy – that was for others to do. But as Uber and AirBNB have quickly learned, when you are disruptors today you better get really good at policy and politics or your company will be killed quickly.
So, is Robert Reich right? No. If we want Facebook, Google and Apple to start acting like a gas utility, regulate it as such. However, if you want to maintain our innovation edge, treat them like start-ups, and they’ll reinvent the world. That’s the approach that leads to a better future.