
Tech Giants Spend $80B to Make Sure No One Else Can Compete - lawrenceyan
https://www.bloomberg.com/news/articles/2018-09-24/tech-companies-spend-80-billion-building-a-competitive-edge
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fzeroracer
While I think the article is pretty low quality I agree with the premise all
the same. The internet as a whole is probably one of the least regulated
markets you can find yourself in (ignoring the oncoming ISP problems for a
second), and yet we see it dominated by a few large companies

What stops smaller search engines from competing? Or smaller social media
alternatives to Facebook? To me I think the answer is simple: Once you reach a
certain size you can continue to squash competition through sheer momentum.
For the people who are more tech savvy we might switch to using DuckDuckGo or
Vivaldi but even my parents who are nigh-illiterate when it comes to computers
knows about Facebook, Google and Chrome. Heck, every time we tell someone to
'just Google it', we see how successful Google is with capturing mind share.

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twblalock
As a counterpoint: in the 1990s the US government was convinced that Microsoft
was an unassailable monopoly dominating all areas of technology. Competition
could not defeat it; only government action could defeat it. All of the
arguments you made in your post, about size and market domination, were made
about Microsoft in the late 1990s.

The government did not break up Microsoft, but then Google came along, and
nobody saw it coming. And Apple became a major player after nearly going out
of business in the 90s, and Facebook dominated a market category called
"social media" that nobody was thinking about in the late 1990s.

It turned out that government action was not necessary, because competition
actually did work, and it worked by creating new technologies that nobody
expected.

I doubt the people who are concerned about market dominance in 2018 know more
than the people who were concerned about it in the late 1990s, and they are
probably just as wrong.

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ergothus
Yet ms dominance was beaten only by linux and firefox...open source efforts,
not competing companies, and those cracks allowed for google and others to
come in.

Prior to that you had crap like "ie6 will be the last ie, and we dont see a
need for tabs in the browser".

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buboard
Nobody thinks linux has beaten windows

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berbec
By sheer install base, it certainly has. Compare Linux servers + android and
windows definately loses. Android at 2.7B vs windows at 1.4b (1)

1:
[https://en.m.wikipedia.org/wiki/Usage_share_of_operating_sys...](https://en.m.wikipedia.org/wiki/Usage_share_of_operating_systems)

~~~
belltaco
It's funny how Android is considered to be Linux when comparing marketshare,
but talk about malware stats, and suddenly Android is not Linux.

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godman_8
It's a poor implementation of Linux that's for sure, but Linux nonetheless.

Some like to call it Android/Linux to distinguish it from GNU/Linux.

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hn_throwaway_99
What a weird title. I don't disagree that the powers of America's tech giants
are cause for concern, but what else would you expect these tech giants to do?
Shouldn't we applaud them for investing to stay competitive? What would the
author rather have them do with their money, more stock buybacks and executive
bonuses?

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dawhizkid
anti-trust?

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threeseed
It's only an anti-trust issue if we have a failed, monopoly market.

In the case of Apple for example they are buying these machines to prevent a
whole range of competitors e.g. Samsung, Microsoft, Lenovo from using
aluminium in their products.

~~~
jplayer01
This only means that modern anti-trust regulations are mismatched and
insufficient for the modern marketplace, not that companies like Google are
innocent of monopoly-like behavior.

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jondubois
Also, another major force is that big companies tend to only do business with
other big companies or startups that are connected to big VC funds which they
themselves control or have strong connections with.

If your startup did not receive funding from a big VC, then big companies will
not do business with you and they will not use your product. It's incestuous
and downright discriminatory.

Companies are not legally allowed to discriminate based on race, gender or
religion but they are allowed to discriminate based on how much capital you
have and where you got it from. It's discrimination against the financially
disconnected; it's not better at all and it's a vicious cycle.

~~~
ladberg
While I don't really like the idea of what follows from it, companies choosing
which other companies to do business with based on their capital makes perfect
sense and shouldn't be banned.

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quxbar
What about companies choosing to use inferior products because their board own
a stake in the producer? What if the majority of shareholders are hurt by this
choice, but they're unaware that it's being made? It's extremely common in my
field and causes noticeable market inefficiency.

~~~
jondubois
Exactly, it's the same force at play and it's arguably capitalism's biggest
problem.

Nepotism (if it can be called that) tends to be inversely proportional to
efficiency.

In most technical fields, the person you know is almost certainly not the best
person for the job.

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esalman
I think internet is not meant to be regulated. But (US) companies like Google
and Facebook dominate how people use the internet. It is all too obvious that
these companies are greedy. Their goal is to maximize profit, and they will do
anything to achieve that as long as within the US law. That includes putting
thousands of human lives at stake. The new LastWeekTonight episode that came
out today deals with this issue- how Facebook has been used to instigate
ethnic cleansing in Myanmar.

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tylerjwilk00
What a manipulative title. Have you no shame.

In other news: McDonald's buys beef to make sure no one else can compete.

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ekianjo
The comparison with GM does not hold much water. GM has been spending a lot
more cumulatively over the years. They are in a mature industry and the
ongoing capital spending is going to remain at lower levels compared to
internet giants suddenly investing from scratch in manufacturing.

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altoidaltoid
Ongoing disruption is expensive

~~~
vuln
You're damn right. Look at the defense budget. Even under a Democrat it
increased.

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anoplus
I wonder if crowd funded open source search engine could be successful. If
crowd funding done right and transparent, I am sure there will be a strong
community behind it.

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threeseed
To be fair they are spending that money to make sure that other giant
competitors can't compete.

It doesn't really affect the majority of startups or SMBs.

~~~
vuln
Really? Looks like they buy out anyone that ever had a chance to compete.

[https://en.m.wikipedia.org/wiki/List_of_mergers_and_acquisit...](https://en.m.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Facebook)

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threeseed
Are you saying these companies didn't want to be acquired ?

Because pretty sure they were thrilled to (a) get paid and (b) have their
product be used by pretty much the entire planet.

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jplayer01
Who cares how thrilled they are? It doesn't change the fact that it stifles
innovation. As for being used by the entire planet, I guess you missed all the
companies/products that are shutdown after being bought?

