The original market value observation is included in the topic # Google 1# Amazon 1# Apple 4#Facebook1.
Getting bigger, but not getting better.
Author/Sai Wen
Editing/Xiaoshimei
"absolute monarch" American technology giants, finally let Biden watch not bottom go to.
Recently, US President Biden signed an executive order, calling on federal government agencies to adopt policies to counter the actions that may stifle competition, lead to price increases, restrict consumers’ choices, reduce mergers and acquisitions, and crack down on monopoly giants in various industries.
The technology industry will bear the brunt of the impact. Previously, more than 30 states had launched anti-monopoly lawsuits against large American technology companies such as Amazon, Google, Apple and Facebook.
This article will focus on the following three issues:
1. What does Biden’s executive order and the new anti-monopoly bill mean to American technology giants?
2. Why are the top technology companies that once made Americans proud regarded as the chief culprit of the US economic recession?
3. Why has the government’s anti-monopoly against technology and Internet companies become a global trend?
one
Heavy-handed antitrust
The executive order signed by Biden this time puts forward guidance and restrictive measures for anti-competitive practices in science and technology, medical care and other fields. At the same time, it aims to increase workers’ income and provide protection for consumers. It involves 12 government departments and contains 72 specific administrative instructions.
▲ Biden signed an executive order.
Specifically, there are a lot of contents in the executive order pointing to the American technology giants.
M&A has become the focus of the U.S. government’s supervision in the science and technology industry, and technology giants will be subject to stricter restrictions when acquiring other small enterprises, especially those emerging competitors;
Introduce new restrictions for online monitoring, user data, etc.
Encourage the Federal Trade Commission to establish rules to prevent Internet companies from using unfair competition methods;
Encourage the FTC to prohibit consumer electronics manufacturers from excluding third-party maintenance policies.
Some media pointed out that Biden’s administrative instructions were specific to each executive department, and even included details about how to review transactions and competition activities, compared with previous governments that left tasks to various departments.
The determination is great and the plan is concrete, which is the most in recent years.
The unfair market environment brought by the monopoly of American technology giants has also led to the lack of innovation in the United States. Coupled with the rising price level and the falling wage level, American consumers and workers have become the payers of the carefree life of technology giants.
If Biden’s executive order can be successfully implemented within a few months, it will undoubtedly bring great pain to a number of large American technology companies.
The splitting of core business and departments, the reduction of product functions, the rejection of mergers and acquisitions, and the strict restrictions on data collection are all big troubles that technology giants will probably face.
The U.S. government, which has always held high the anti-monopoly issue for its own technology enterprises, is finally going to be serious.
2
Cunning tycoons
American technology companies are best at labeling themselves as innovative, free, transparent and shared, but in fact they are well versed in the way of "store bullying customers".
The unbearable White House, the new policy introduced this time, completely exposes how American technology giants put their own interests above consumers, and how they rely on their deep pockets to let small companies choose between death and annexation.
Just GAFA(Google Amazon Facebook Apple) can list countless examples.
▲ In July 2020, the CEOs of the four major American technology giants attended the antitrust hearing with the same screen.
Facebook maintains its market position by preventive acquisition. If you can’t buy it, copy it.
There is a special early warning intelligence department within Facebook, which mainly focuses on small start-ups that are innovating and developing products that may pose a threat to Facebook in the market. Once these companies become small, Facebook will immediately buy them. The acquisition will not achieve plagiarism and imitation, and then use its own number of users to crush each other. In short, it is necessary to absorb competitors or squeeze out the market.
Within the company, there is even a widely circulated philosophy: don’t bother to copy because of your pride.
Instagram was founded in 2011, and Facebook bought it for $1 billion in 2012. In 2014, Facebook spent $19 billion to buy WhatsApp, the largest instant messaging software in the world at that time.
Once those opponents were acquired and handed over users, markets and data, Zuckerberg stopped paying attention to them, but continued to put Facebook at the core of the product matrix, and even continued to let Facebook copy the algorithms and functions in various applications.
Amazon pretends to be a trading platform that provides matching services, but chooses to trade at the end and treat itself with peace of mind.
As an e-commerce platform, Amazon can obtain commercially sensitive information such as goods and transactions of third-party merchants. It "forces" consumers’ data from merchants, and makes customers’ preferences clear. These data analysis are not used to improve the experience of both parties to the transaction, but are used by Amazon to sell its own goods.
What other people sell well, Amazon will produce and put on the shelves, and let the self-operated goods occupy the recommendation position, pushing the competitive goods aside. The dual identity of platform and trader gives Amazon the opportunity to use its own data advantages to damage the fair market environment.
Both merchants and consumers finally find that the result of their selling and buying is nothing more than a wedding dress for Amazon’s stock price soaring.
▲ Protesters put up banners of "Let Amazon pay the price" and "We are not robots and data"
Google "rightfully" engages in the overlord clause.
The Android system made by Google has taken the lead in the global mobile phone system market share. As a result, Google "justifiably" makes global mobile phones tied to its own ecology. Chrome is pre-installed in the browser, Gmail is pre-installed in the mailbox, YouTube is the video software, and Google Maps is pre-installed in the map … No matter which country’s brand wants to use Android on the mobile phone, it must first bind the Google three-piece suit.
So far, there is only one country in the world where users can avoid the Google three-piece bundle, and that is China.
As long as the mobile phones sold in Chinese mainland are based on domestic manufacturers’ systems such as emui and miui, or foreign brands such as Samsung and LG equipped with Android, there is no need to pre-install Google. The appearance of Huawei’s self-developed HarmonyOS system makes Google’s idea of bundling even more difficult.
When Apple sells products, it wants to make money for maintenance.
Apple, which does not recognize third-party maintenance, does not support self-disassembly, and does not guarantee without spending much money, can achieve "one fish and three meals" on a piece of equipment-selling machines to earn a sum of money, repairing machines to earn a sum of money, and preventing machines from repairing to earn another sum of money.
In order to get official certification, consumers have to pay several times the price of roadside maintenance booths to get their equipment back.
Monopoly brings unparalleled market power and makes American technology giants "lawless". America’s innovation ability is being eroded by mergers and acquisitions, shanzhai, plagiarism and overlord clauses of these big companies, and the people have to pay for all these consequences.
"Capitalism without competition is not capitalism, but exploitation." This is Biden’s evaluation of monopoly enterprises.
▲ Biden tweeted: "I make it clear that capitalism without competition is not capitalism, but exploitation."
In the face of administrative orders and the latest anti-monopoly law, technology giants will not give in easily.
As soon as the bill came out, executives, lobbyists and propaganda groups of technology giants came to Congress and departments’ offices, found every relevant member of parliament, bombed mailboxes and telephones, and played up the terrible consequences of these laws.
"Anti-monopoly law should promote competition and protect consumers, not punish successful American companies." I don’t know if they can believe this kind of wandering speech …
three
Global wave
With the improvement of the epidemic situation, governments around the world have gradually shifted their attention to the economic field. Coincidentally, whether in the United States, China or the European Union, the government has put the anti-monopoly against technology giants in a prominent position, and it has taken unprecedented measures quickly and severely.
It has become a global wave to crack down on large-scale technology groups over the interests of consumers.
What is the logic behind this?
First, the characteristics of the technology industry itself make the consequences of monopoly more harmful to society.
Technology and network companies are not only selling a commodity, but also grabbing attention and creating a system ecology. The resources mastered by the technology giants can constantly March into other fields. An Internet-born enterprise can do news and software, as well as sell cars and engage in finance.
The traffic and users they get in the field of science and technology can be completely migrated to another field in this era. Then the monopoly in science and technology means that these giants may realize cross-market and cross-field monopoly in the future, and then the monopoly in the whole market and all fields.
▲ All-encompassing Google product matrix
When the user’s attention and all the users’ ecology are pinned on a few products, in fact, the individual has become a tool person at the mercy of capital.
The market loses competition, consumers lose choice, and large companies can complete the harvest without effort. So how can the government and individuals expect the market to be dynamic?
Second, the window of global technology upgrading has arrived, and all countries need to complete enterprise adjustment to adapt to the next stage of international competition. No matter whether a country’s technological development is mature or not, the anti-monopoly efforts against technology giants at the national level will only become stronger and stronger.
At this stage, 5G technology is gradually maturing, and the world is moving from the era of mobile internet to a new era of Internet of Things. The government should not only ensure that the domestic market is free from exploitation by foreign enterprises, but also fully stimulate the vitality of the market at key time nodes, so that those innovative enterprises that should take off in the next era will not be strangled in the cradle by giants.
At the same time, moderately beating the giants with the best resources, the strongest ability and the strongest financial resources is also to guide them to re-focus on technological research and innovation. Let them do something more "difficult", instead of letting consumers have no choice but to pay for some unskilled bullying behavior.
From this perspective, governments all over the world, including China and the United States, stand at the same starting point in science and technology antitrust.
The difference is that, compared with us, Biden has to use a much more complicated means to confront more and more cunning scientific and technological "elites" who have no fear of the government.
Good luck to him …
■ Disclaimer
This paper deals with the contents of listed companies, and is the author’s personal analysis and judgment based on the information publicly disclosed by listed companies according to their legal obligations (including but not limited to temporary announcements, periodic reports and official interactive platforms, etc.); The information or opinions in this article do not constitute any investment or other commercial suggestions, and Market Value Watch shall not be responsible for any actions arising from the adoption of this article.
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Original title: "Biden is going to fight the American tiger"
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