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FAANGs for the memories: Breaking up big tech's biggest isn't a matter of if, but of when

Claptrap314 Silver badge

The writer gets the network effect wrong, and just goes downhill from there. The real power of Google is most definitely NOT the network effect. It's vertical integration of data services. Each bit of data that is held by Amazon, Google or Facebook enhances the value of a significant subset of the existing data. That value can be converted into profit, to people outside the company, or used for pet projects. Of course, they all are going for profit. But the point remains--the bigger the dataset, the more valuable each datum in the dataset, and not by a little bit. Breaking up the dataset will entail real loss of social good.

That's the rub.

The major social harm from Google and Twitter is coming from the pet projects. They are meddling with elections, as reported in these pages, because they know what is best for the rest of us. Facebook is also doing this, but their primary harm is coming from the fact that they drive engagement by driving outrage. Also known as the echo chamber. The effect is nearly apolitical, but it makes us far more ready to take action against each other than we would be without it.

And there is the raw threat of monopolism. My wife noted years ago that Amazon's prices were not always that much better than what she could find elsewhere. Monopolists regularly create social harm because they are not motivated to innovate towards customer value.

There is also a secondary social harm with all that data. Even if these companies were completely ethical regarding their use of the data, the threat of data ending up in the hands of a less ethical actor (that is, almost any government / organized criminal operator) is extremely high.

It's nightmare enough if Google or Facebook decides you are guilty of a thought crime. If your local nation state comes to the same conclusion, it is much, much worse.

But the idea of breaking up Google is almost silly. Is search profitable? Is maps? How much would the profitability of YouTube suffer if it was cut off from all of the other data associated with the user? Yes, they have reorganized in preparation to being forced to split up, but it's going to be a heck of a ride trying to figure out how to make it work.

No, I'm not very optimistic about the next 10-20 years in this regard.

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