The internet makes it easier for tech companies to become a monopoly?
The investment in the internet has brought so much benefit to human beings, including online shopping, social media platforms, new ways to gain social identity, etc. In digital markets and the tech industry, looking into giants such as Facebook, Google, and Amazon. They create an increasing number of economic opportunities. However, these companies too much power maybe has helped them to become a monopoly.
Facebook’s Monopoly
Facebook clearly dominates social media. We can investigate this from the following perspectives. Firstly, Facebook’s dominance is reflected in its usage algorithm. About 70 percent of American adults use social media, and the majority of those use Facebook products: More than two out of three adults use Facebook, one out of three adults use Instagram, and one out of five adults use WhatsApp. In addition, Facebook has now become the main way people of all ages communicate online.
Secondly, the acquisition of Instagram ensured that Facebook would maintain its dominance of the photo social media platforms. On the other hand, WhatsApp leads Facebook to enter instant messaging using real-time technologies. Facebook also used its monopoly position to keep competitors out of the competition or they just copy their technology and kill the innovation.
Thirdly, Mark Zuckerberg’s power and influence. According to New York Times article, it said that “Mark alone can decide how to configure Facebook’s algorithms to determine what people see in their News Feeds, what privacy settings they can use and even which messages get delivered. He sets the rules for how to distinguish violent and incendiary speech from the merely offensive, and he can choose to shut down a competitor by acquiring, blocking, or copying it.” This reminds me of a conversation in Prof Galloway’s podcast in which he interviews Sinan Aral. They talked about the business model as a big driver of negative consequences and a true leader is aligning societal value as shareholders’ value which should be the long-term value. This is more effective than getting fixed quick short-term shareholder value. From my perspective, Mark Zuckerberg focuses too much on business growth. Maybe he should consider changing and just like Sinan Aral said, “aligning a sustainable long term profit-maximizing business model with society's values”.
Technology has become a crucial part of our everyday lives. Especially in the digital market, it may be easier to use specific algorithms to prioritize the content the company wants the audience to see. However, in addition to the government regulation, a company leader should set society’s value as a priority to create incentives to make the long-term goal successful.
