BIG TECH
Big Tech, also known as the Tech Giants, Big Four, or Big Five, is a name given to the presently four or five largest, most dominant, and most prestigious companies in the information technology industry. Big Tech is a term that refers to the most dominant and largest technology companies in their respective sectors. Their products and services are used globally and have become heavily relied upon by businesses and individuals alike, bringing up privacy, safety and Antitrust concerns about their influence and operations and whether strict regulations should be considered.
The Big Four consist of Alphabet (Google), Amazon, Apple, and Meta (Facebook)—with Microsoft completing the Big Five.
The tech giants are the dominant players in their respective areas of technology, namely: e-commerce, online advertising, consumer electronics, cloud computing, computer software, media streaming, artificial intelligence, smart home, self-driving cars, and social networking. They have been among the most valuable public companies globally, each having had a maximum market capitalization ranging from around $1 trillion to above $3 trillion. They are additionally considered to be among the most prestigious and selective employers in the world, especially Google.
The big tech companies have complete dominance in their respective sectors. Apple with communication internet devices, Facebook in the social media space, Google for internet searches, and Amazon as the dominant player in the e-commerce market have wholly dominated their respective sectors.
Big Tech companies typically offer services to millions of users, and thus can hold sway on user behavior as well as control of user data. Concerns over monopolistic practices have led to antitrust investigations from the Department of Justice and Federal Trade Commission in the United States, and the European Commission. Commentators have questioned the impact of these companies on privacy, market power, free speech and censorship, and national security and law enforcement. It has been speculated that it may not be possible to live in the digital world day-to-day outside of the ecosystem created by the companies.
Broader groupings of Big Tech may also include Twitter and Netflix. Occasionally, despite being an automaker, Tesla has also been referred to as a Big Tech company. In addition, Chinese companies such as Alibaba, Tencent, and Baidu are also referred to as big tech firms. However, they are positioned as competitors to the Big Five rather than included within the same umbrella.
Acronyms
HOW BIG TECH IS DOMINATING THE MARKET
Controversies and Big TechBig Tech Companies Use Data for Profit
Big Tech Limits the Market Access of Smaller Companies
Big Tech Can Impact Government Decisions and Operations
Big Tech Companies Have Incredible Influence
Path Forward for Regulating Big Tech
There are several large companies that are frequently listed as Big Tech.
A subsidiary of holding company Alphabet Inc., Google LLC is an American multinational technology company specializing in internet-related services and products, including a search engine, online advertising technologies, cloud computing, software and hardware. Founded in 1998 by Larry Page and Sergey Brin, Google is the world's largest search engine. Over 1 billion people use its products and services. As of December 2020, Google had a global search engine market share of 91.38%.
Google search returns results for a user query based on the priority rank system. Google indexes hundreds of terabytes of information from millions of web pages. The search engine is so efficient that the user gets his query resolved in the top five search results that Google returns. Google also provides an image-based search, in conjunction with the regular search engine. Google has mostly been a pioneer in software services, providing software for personal as well as enterprise use.
Google has not limited itself to only its search engine model but offers many other services like email, web browser, video sharing site, and mobile app, which are leaders in their segments. Google earns a majority of its revenue from ads, but these ads are minimalistic and usually don't hinder the user's experience. Google also provides insights and analytics so that advertisers can reach a broader target audience by tweaking their content to appear higher in Google's search results.
Another area in which Google has excelled in the past few years is providing premium hardware along with its already popular and efficient software to build an ecosystem to provide the best user experience. Google Pixel and Google Home are some of the best and popular devices that run on the Google ecosystem, and Google continually works to improve them so users can benefit from them.
Amazon is the world's largest e-commerce marketplace, cloud computing platform, and an AI assistance platform. It is the largest internet company in the world in terms of revenue. It was started in 1994 by Jeff Bezos as an online marketplace for books but soon expanded to sell other products, including electronics, video games, software, clothing, furniture, food, toys and jewelry. Amazon is the largest internet company in the world in terms of revenue, realizing $280.5 billion in revenue in 2019. A multinational technology company, Amazon also owns a cloud computing company, Amazon Web Services (AWS); a publishing arm, Amazon Publishing; and a film and television studio, Amazon Studios. The company also offers devices and services, such as Alexa, Echo, Fire TV and Fire tablets, and creates and provides access to entertainment through Amazon Originals, Prime Video, Audible, Twitch and Amazon Music. Over the years, Amazon acquired several companies, including Ring, Whole Foods Market and IMDb.
Founded in 2004 by Mark Zuckerberg, social networking site Facebook enables registered users to create profiles; connect with family, friends and colleagues; send messages; and upload photos and videos. As of Dec. 31, 2020, Facebook had 2.8 billion monthly users and posted annual revenue of $86 billion. Facebook, which operates on an ad revenue model, is always looking for ways to provide its users with a better social media experience. In March 2012, Facebook acquired Instagram for $1 billion, and in February 2014, the social media giant acquired WhatsApp for $19 billion.
There have been other social networking sites like Myspace and Orkut, but these couldn't provide the user experience that Facebook provided. Myspace saw a decline in its user base as it stuck to its idea of connecting people around entertainment and music. Also, Myspace was heavily advertised, which cluttered the user's feed and provided a not-so-engaging experience. Orkut faced a similar decline as the website paid less attention to user data security and privacy.
Facebook too, works on an ad revenue model, but the ads don't hinder the user's experience on the site. Facebook also implements stringent security protocols to protect user data and privacy. Facebook also has a 'Facebook bug bounty program' in practice where users who find bugs and report them to Facebook are granted cash prizes for the same. Facebook has always been open to change and incorporating new technology, which has made it a leader in the social media space.
Apple was valued over USD 1 trillion in August 2018, making it the first public US company to be valued at over USD 1 trillion. At the end of 2020, Apple Inc. was the world's largest technology company with revenues of $267.7 billion. Founded by Steve Jobs, Steve Wozniak and Ronald Wayne in 1976, Apple designs and sells a range of products, including software, hardware, services, digital applications and accessories. Apple's products include the Mac, iPhone and iPad.
Data security and privacy are one of the significant areas Apple has excelled in. The security measures put in place are leading the industry. Although the security measures may not be foolproof, they are leading the industry with security protocols. Apple has completely revolutionized the way we use technology in our daily lives.
The tech giant also offers the iOS, OS X and watchOS operating systems (OSes); iCloud; and Apple Pay. Apple continuously expands its market share by launching new products and services, such as Apple Watch, Apple Music, Apple TV and Apple HomePod. Innovation and a closed secure ecosystem providing a satisfactory user experience are at the core of Apple's functioning.
Acronyms Other acronyms have been given to the companies listed above, as well as a few others. These include the following:
· Introduced by Goldman Sachs, FAAMG is the acronym for the
five top-performing tech stocks in the market: Facebook, Amazon, Apple,
Microsoft and Google. The acronym GAFAM may also be used in reference to these
companies.
· This is the acronym for the stocks of five major American technology
companies: Facebook, Amazon, Apple, Netflix and Alphabet's Google. The term was
originally FANG (Facebook, Amazon, Netflix and Google). The second "A" in FAANG
for Apple was added in 2017.
what is big tech and why we should care | Artificial Intelligence | (allerin.com)
How Big Tech is dominating the market
Tech giants continue to dominate because they understand their markets and their customers' needs, and they deliver products that ensure customer satisfaction.
Due to their dominance in the technology market, big tech companies also influence the economy and society. These companies are shaping the way our society is progressing. The products and services offered by big tech are used by hundreds of millions all over the world. Although all these companies started in the USA, they have established a global presence, and are continually looking to expand into markets currently not penetrated. Continuously striving to deliver better products and not letting failures hinder their growth has contributed to the tremendous growth of these companies.
In January 2020, Big Tech companies became the center of an antitrust investigation by the United States House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law. In January 2021, the committee published a report stating that Apple, Amazon, Facebook and Google are each using antitrust methods to dominate their respective markets. The report suggested that tech giants are using the large amounts of consumer and business data they've accumulated to maintain their monopoly position, gain an advantage in the markets for new products, stifle innovation by rivals and push out competitors completely. The report concluded that corrective action, including the possibility of dividing these companies, be implemented through legal action taken by the Department of Justice (DOJ) or legislation implemented by Congress.
In June 2020, the EU began two antitrust investigations
into Apple's conduct regarding the company's music and book streaming services,
as well as its mobile payment service. The EU alleges the company uses its
monopoly to stifle competition and manipulate financial markets.
The three major areas seen as in need of regulation are the following:
1. Safety concerns include product development and business models, such as the development of facial recognition software and algorithms that amplify harmful content.
2. Competition, as discussed previously, is a concern as the monopoly of these companies has prevented the creation of possible alternatives
3. Privacy has been a major concern as scandals such as Cambridge Analytica have surfaced over the years. As tech companies gather personal data without restrictions, the concern over how they can exploit the data grows.
Polices such as the EU's General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) have ensured that consumers can opt out of data usage.
Originally by Linda Rosencrance updated in March 2021 What is Big Tech? (techtarget.com)
Big Tech Companies Use Data for Profit
Big Tech companies often provide free resources. For example, there’s no subscription fee required to do a Google search or have a Facebook profile. However, large tech companies gather customer information and use it to profit. For example, Facebook collects information about users’ race, religion, and political views. It can then sell that information to advertisers.
People often want to know what Big Tech does to prevent issues with data collection and advertising. Unfortunately, evidence shows it often falls short in policing the ads shown on the respective platforms or lacks appropriate controls. For example, Facebook advertisers could target people interested in illegal activity.
Evidence also emerged of foreign countries purchasing misleading ads to influence elections in the United States. More recently, ads nurtured people’s interest in COVID-19 “cures” and helped the anti-vaccine movement flourish.
These reasons and others cause people in power to point out that Big Tech regularly mishandles people’s data. Even if those companies do not experience breaches, the applications for user information by third parties raise eyebrows and strengthen the arguments to lessen the power such businesses have.
On the other hand, data collection generally enables more personalized services. If someone searches for all-natural house cleaning products on Google, they’ll usually see ads related to those items, which could assist people with their purchases. Similarly, Google and Apple collect information about how customers use their smart assistant services to increase future accuracy.
Big Tech Limits the Market Access of Smaller Companies
Another argument against Big Tech is that such companies make it harder for smaller entities to enter and compete in the marketplace. Big businesses shape how people use the internet and the avenues they go through to get what they need.
Small-business advocacy groups also call on governments to restrict Amazon, complaining that the e-commerce giant’s resources help it dominate less-established entities. It particularly took issue with Amazon’s in-house brands and how products sold under them are often cheaper than competitors offer, drastically undercutting the market.
Big Tech can also help smaller companies, however. For example, the Google Play Store and Apple’s App Store give lesser-known developers a larger platform, making it easier for customers to find their products. Also, Amazon’s Marketplace opens opportunities for small companies to sell items on Amazon and let the e-commerce site fulfill those orders. As a result, products often reach customers faster than they otherwise would.
Big Tech Can Impact Government Decisions and Operations
The name recognition associated with Big Tech companies convinces many government authorities to use services offered by those providers. Google, Microsoft, and Amazon have numerous government agencies as customers. Amazon Web Services (AWS) even offers a specific cloud service for government entities.
Big Tech companies’ interactions with the government can also create beneficial situations for everyone, though. For example, Google and Apple partnered to develop a privacy-focused contact-tracing solution during the COVID-19 pandemic. Businesses have also offered resources to help governments reach vaccine-hesitant groups during immunization campaigns.
Big Tech Companies Have Incredible Influence
Big Tech companies have so much power and resources that their impact spreads far beyond single entities. For example, Facebook owns Instagram and WhatsApp. Its acquisitions include a drone manufacturing company, a video software brand, and a street-level imaging service.
Plans from Google, Apple, and Amazon to develop health services or collect patient data also show the growing influence of these companies. Such growth often blurs the lines between once-distinctive industries. For example, people in select areas can pay for parking and transit fares through Google Maps. Apple’s engineers want to break into the electric self-driving car market.
As Big Tech companies exert power in more areas, positives become apparent, too. Increased technological investments and commitments to innovation are some examples. For example, Facebook’s involvement in campaigns to increase internet access could decrease the digital divide.These businesses also research ethical uses for artificial intelligence, achieving progress while reducing potential dangers.
Path Forward for Regulating Big Tech
Individual government leaders must decide how to go about limiting impact and in what areas of society. New antitrust laws in the US aim for Big Tech, but how effective they are remains to be seen.
Given Big Tech’s advantages described here, breaking up the respective companies could end those benefits. Any party with the influence to realistically reduce this corporate dominance must weigh the pros and cons before any final decisions occur.
Originally by SHANNON FLYNN PUBLISHED AUG 21, 2021 What Is Big Tech and Why Is the Government Trying to Break It Up? (makeuseof.com)