over 3 years ago • 3 mins
Tech companies have dominated the stock market and the world at large for years, but governments around the world have finally started to fight back.
In a matter of years, tech companies have gone from being relatively small businesses focused on ecommerce or internet search to sprawling conglomerates dominating several markets at once. That’s partly because of the sheer number of acquisitions they make: Alphabet, Amazon, Apple, Facebook, and Microsoft have already announced 19 deals between them this year alone. Bolting on smaller companies, after all, tends to attract less regulatory scrutiny – especially when they operate in businesses where the tech giants themselves don’t have much of a track record.
One-stop-shops for ecommerce, productivity services, and social networking might make our lives easier, but they also risk unfairly stopping new companies from gaining ground. That might explain why Microsoft was fined for preloading its Internet Explorer onto Windows computers, and Google was penalized for similar behavior on its Android operating system. And more recently, why the US government has said it’ll look into how the likes of Amazon use the data they collect.
The latest debate around tech companies centers on social media companies’ influence over elections. When Twitter announced it’d ban political ads on its platform last year, Facebook refused to make the same commitment. And on Thursday, the latter’s CEO said outright that he doesn’t think it’s the responsibility of social networks to fact-check politicians – a direct contrast to Twitter’s new fact-checking habits.
Tech companies are so big now that it’s hardly surprising they’re attracting more government attention. But the real question is whether that attention comes in the form of higher taxes – as we’re seeing levied against those with European operations – or in the form of new rules on how they can use data, or even revised laws that currently protect certain companies from liability for user-generated content.
The global stock market dances to the beat of US tech’s drum: American stocks represent half the global market capitalization, and major tech companies contribute more than 20% of the US market. According to a Goldman Sachs report last month, in fact, the biggest companies in the US have been responsible for the lion's share of the stock market’s recovery since the coronavirus-induced bear market crash – and that means tech stocks may be the ones propping things up for now.
Data out on Thursday showed the number of US workers receiving unemployment benefits fell last week for the first time since February, and the number of people filing for unemployment for the first time fell compared to the week before. That suggests coronavirus-driven job losses might be close to a low – and with the US economy slowly reopening, optimists might hope that job increases will be reported before much longer.
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