Difference between revisions of "The Big Four"

From SI410
Jump to: navigation, search
(Amazon)
(Added more information to the Google, Apple, Facebook, and Amazon subsections. Additionally added 11 new references (references 8-17,20))
Line 8: Line 8:
 
==== Google ====
 
==== Google ====
 
Run by parent company Alphabet, Google plays to the “head” or “brain” of human beings.<ref name='The Four'></ref> With monopolization of search and digital advertising, Google has caught itself in several lawsuits regarding their anti-competitive conduct and promotion of Google’s own products in search results over independent competitors. Despite $9 billion in fines, legal action has done little to influence Google’s business practices or market position.<ref name='SchechnerPop'>Schechner, Sam & Pop, Valentina. "Europe's Antitrust Push Against Google Hasn't Dented Its Heft. Can the U.S.?", The Wall Street Journal, 21 October 2020, https://www.wsj.com/articles/europes-antitrust-push-against-google-hasnt-dented-its-heft-can-the-u-s-11603293443</ref>
 
Run by parent company Alphabet, Google plays to the “head” or “brain” of human beings.<ref name='The Four'></ref> With monopolization of search and digital advertising, Google has caught itself in several lawsuits regarding their anti-competitive conduct and promotion of Google’s own products in search results over independent competitors. Despite $9 billion in fines, legal action has done little to influence Google’s business practices or market position.<ref name='SchechnerPop'>Schechner, Sam & Pop, Valentina. "Europe's Antitrust Push Against Google Hasn't Dented Its Heft. Can the U.S.?", The Wall Street Journal, 21 October 2020, https://www.wsj.com/articles/europes-antitrust-push-against-google-hasnt-dented-its-heft-can-the-u-s-11603293443</ref>
 +
 +
Google has, over time, aggressively acquired more and more companies. These companies include, but are not limited to, Android, YouTube, and AdSense <ref>Hartmans, A. (2020, February 12). All the companies and divisions under Google's parent company, alphabet, which just made yet ANOTHER shake-up to its structure. Retrieved March 19, 2021, from https://www.businessinsider.com/alphabet-google-company-list-2017-4#google-adsense-lets-publishers-earn-money-from-online-content-placing-ads-on-publishers-webpages-advertising-drives-the-majority-of-revenue-for-google-29</ref>. Android is an operating system for mobile phones which competes with IOS from Apple. As of May 7, 2019, there are over 2.5 billion active devices running Android <ref>Brandom, R. (2019, May 07). There are now 2.5 billion active Android devices. Retrieved March 19, 2021, from https://www.theverge.com/2019/5/7/18528297/google-io-2019-android-devices-play-store-total-number-statistic-keynote</ref>. Similarly, YouTube is a free video sharing website created in 2005. Every month, visitors watch around 6 billion hours’ worth of videos<ref>YouTube: What Is youtube? (n.d.). Retrieved March 19, 2021, from https://edu.gcfglobal.org/en/youtube/what-is-youtube/1/</ref>. Lastly, AdSense is an advertisement platform which helps website owners earn money by displaying ads<ref>Google adsense - earn money from website monetization. (n.d.). Retrieved March 19, 2021, from https://www.google.com/adsense/start/</ref>. Website owners get paid every time a user clicks on an ad, with the owner getting 68% of the money and Google getting 32% of it. As a result of this, Google makes a large share of its income through AdSense<ref>Chris, A. (2019, December 02). How does Google Adsense works. Retrieved March 19, 2021, from https://www.reliablesoft.net/how-does-google-adsense-works/</ref>.
  
 
==== Apple ====
 
==== Apple ====
 +
Apple is a technology company which produces and sells phones, computers, services, and more. Some of these products are the iPhone, iPad, Mac, iPod, Apple Watch, and the Apple TV<ref>AAPL.O - Apple inc profile. (n.d.). Retrieved March 19, 2021, from https://www.reuters.com/companies/AAPL.O</ref>. As of January 2021, there are 1.65 billion Apple devices in use with over a billion iPhones sold<ref>Department, P., & 22, J. (2021, January 22). IPhone sales by year. Retrieved March 19, 2021, from https://www.statista.com/statistics/276306/global-apple-iphone-sales-since-fiscal-year-2007/#:~:text=In%20their%202018%20fiscal%20year,more%20than%20217%20million%20iPhones</ref>. In the 2018 fiscal year, Apple sold more than 217 millions iPhones<ref>Kastrenakes, J. (2021, January 27). Apple says there are now over 1 billion active iPhones. Retrieved March 19, 2021, from https://www.theverge.com/2021/1/27/22253162/iphone-users-total-number-billion-apple-tim-cook-q1-2021</ref>. Year after year, Apple has seen an average trend of increasing revenue with 274.515 billion dollars in revenue for the 2020 fiscal year<ref>Apple revenue 2006-2020: AAPL. (n.d.). Retrieved March 19, 2021, from https://www.macrotrends.net/stocks/charts/AAPL/apple/revenue</ref>.
 +
 
Apple plays on “procreation” by utilizing the common consumer behavior of making irrational decisions.<ref name='The Four'></ref> As the most profitable company in history, Apple’s profits are greater than the combined profits of Google, Facebook, and Amazon.<ref name='The Four'></ref>
 
Apple plays on “procreation” by utilizing the common consumer behavior of making irrational decisions.<ref name='The Four'></ref> As the most profitable company in history, Apple’s profits are greater than the combined profits of Google, Facebook, and Amazon.<ref name='The Four'></ref>
  
 
==== Facebook ====
 
==== Facebook ====
Facebook plays to the “heart” by tapping into the human desire to love and be loved by others (mostly through the use of images and previous relationships that create empathy and expand an individual’s circle of love).<ref name='The Four'></ref> Facebook monopolizes social networking. According to mobile intelligence firm Apptopia, Facebook owns four of the top 10 most downloaded apps of 2020: [[Wikipedia: WhatsApp|WhatsApp]], [[Wikipedia: Instagram|Instagram]], [[Wikipedia: Facebook Messenger|Messenger]], and Facebook.<ref>Blacker, Adam. "Worldwide & US Download Leaders 2020", Apptopia, 7 January 2021, https://blog.apptopia.com/worldwide-us-download-leaders-2020</ref>
+
Facebook is a social networking site created in 2004 by Mark Zuckerberg that plays to the “heart” by tapping into the human desire to love and be loved by others (mostly through the use of images and previous relationships that create empathy and expand an individual’s circle of love).<ref name='The Four'></ref> It allows people to connect with friends and family over the internet and has over 1 billion users worldwide<ref>Facebook: What is facebook? (n.d.). Retrieved March 19, 2021, from https://edu.gcfglobal.org/en/facebook101/what-is-facebook/1/</ref>. In 2020, Facebook generated around 86 billion dollars in revenue, with its main source of income being advertisements on its website. Over time, Facebook has expanded its influence and acquired other social media platforms. According to mobile intelligence firm Apptopia, Facebook owns four of the top 10 most downloaded apps of 2020: [[Wikipedia: WhatsApp|WhatsApp]], [[Wikipedia: Instagram|Instagram]], [[Wikipedia: Facebook Messenger|Messenger]], and Facebook.<ref>Blacker, Adam. "Worldwide & US Download Leaders 2020", Apptopia, 7 January 2021, https://blog.apptopia.com/worldwide-us-download-leaders-2020</ref>
  
 
==== Amazon ====
 
==== Amazon ====
As the leader in e-commerce with 50% of all online sales occurring through Amazon, the platform plays to the gut or “large intestine” of humans.<ref name='The Four'></ref><ref>Statistica. "Most popular online retail websites worldwide in 2020, by average monthly traffic", 2020, https://www.statista.com/statistics/274708/online-retail-and-auction-ranked-by-worldwide-audiences/</ref> Individuals are biologically programmed to survive and believe the idea that less is bad and more is always better.<ref name='The Four'></ref> Their monopolization of e-commerce makes it near impossible for independent merchants to compete with the company.<ref name='KingMcCave'>King, Cecilia & McCave, David. "House Lawmakers Condemn Big Tech's 'Monopoly Power' and Urge Their Breakups", The New York Times, 6 October 2020, https://www.nytimes.com/2020/10/06/technology/congress-big-tech-monopoly-power.html</ref>
+
As the leader in e-commerce with 50% of all online sales occurring through Amazon, the platform plays to the gut or “large intestine” of humans.<ref name='The Four'></ref><ref>Statistica. "Most popular online retail websites worldwide in 2020, by average monthly traffic", 2020, https://www.statista.com/statistics/274708/online-retail-and-auction-ranked-by-worldwide-audiences/</ref> Individuals are biologically programmed to survive and believe the idea that less is bad and more is always better.<ref name='The Four'></ref> Their monopolization of e-commerce makes it near impossible for independent merchants to compete with the company.<ref name='KingMcCave'>King, Cecilia & McCave, David. "House Lawmakers Condemn Big Tech's 'Monopoly Power' and Urge Their Breakups", The New York Times, 6 October 2020, https://www.nytimes.com/2020/10/06/technology/congress-big-tech-monopoly-power.html</ref>. In the late 2000’s, for example, Amazon drove an online diapers seller, Quidsi, into selling their company to Amazon by creating a competing product and selling at a loss. Eventually, Amazon’s lower prices caused Quidsi to lose much of its consumer base and were bought out by Amazon<ref>Lecher, C. (2019, May 13). How low prices could make for an antitrust case against Amazon. Retrieved March 19, 2021, from https://www.theverge.com/2019/5/13/18563379/amazon-predatory-pricing-antitrust-law</ref>.
  
 
== Ethical Concerns: Antitrust ==
 
== Ethical Concerns: Antitrust ==

Revision as of 13:13, 19 March 2021

Companies that makeup GAFA (Google, Amazon, Facebook, Apple)[1]

The “Big Four” – also known as “The Four[2], “GAFA”, or “The Four Horsemen” – is an acronym for Google (Alphabet), Apple, Facebook, and Amazon. These four have been separated from other big tech companies on the basis of one characteristic: their ability to influence political and societal change and consumer behavior through their oligopolization of the digital market. As former Google CEO Eric Schmidt has said, they “[drive] the consumer revolution in the minds of the consumer”[3], isolating them from other big tech companies like Microsoft and IBM. However, this immense power has so far gone without regulation, leaving the Big Four as de facto market regulators.[4] As their size and market dominance continues to grow, the international concern of the Big Four's ethical violation of antitrust laws continues to grow.

Who are "The Big Four"?

The Big Four has a combined market capitalization of almost $4.5 trillion USD.[5][6] While all four companies operate within the same general digital economy, each company specifically monopolizes an area of the digital market, making the competition overlap of the four companies with one another very little. This allows them to dominate their own individual market while creating an oligopoly of the general digital economy.

Google

Run by parent company Alphabet, Google plays to the “head” or “brain” of human beings.[2] With monopolization of search and digital advertising, Google has caught itself in several lawsuits regarding their anti-competitive conduct and promotion of Google’s own products in search results over independent competitors. Despite $9 billion in fines, legal action has done little to influence Google’s business practices or market position.[7]

Google has, over time, aggressively acquired more and more companies. These companies include, but are not limited to, Android, YouTube, and AdSense [8]. Android is an operating system for mobile phones which competes with IOS from Apple. As of May 7, 2019, there are over 2.5 billion active devices running Android [9]. Similarly, YouTube is a free video sharing website created in 2005. Every month, visitors watch around 6 billion hours’ worth of videos[10]. Lastly, AdSense is an advertisement platform which helps website owners earn money by displaying ads[11]. Website owners get paid every time a user clicks on an ad, with the owner getting 68% of the money and Google getting 32% of it. As a result of this, Google makes a large share of its income through AdSense[12].

Apple

Apple is a technology company which produces and sells phones, computers, services, and more. Some of these products are the iPhone, iPad, Mac, iPod, Apple Watch, and the Apple TV[13]. As of January 2021, there are 1.65 billion Apple devices in use with over a billion iPhones sold[14]. In the 2018 fiscal year, Apple sold more than 217 millions iPhones[15]. Year after year, Apple has seen an average trend of increasing revenue with 274.515 billion dollars in revenue for the 2020 fiscal year[16].

Apple plays on “procreation” by utilizing the common consumer behavior of making irrational decisions.[2] As the most profitable company in history, Apple’s profits are greater than the combined profits of Google, Facebook, and Amazon.[2]

Facebook

Facebook is a social networking site created in 2004 by Mark Zuckerberg that plays to the “heart” by tapping into the human desire to love and be loved by others (mostly through the use of images and previous relationships that create empathy and expand an individual’s circle of love).[2] It allows people to connect with friends and family over the internet and has over 1 billion users worldwide[17]. In 2020, Facebook generated around 86 billion dollars in revenue, with its main source of income being advertisements on its website. Over time, Facebook has expanded its influence and acquired other social media platforms. According to mobile intelligence firm Apptopia, Facebook owns four of the top 10 most downloaded apps of 2020: WhatsApp, Instagram, Messenger, and Facebook.[18]

Amazon

As the leader in e-commerce with 50% of all online sales occurring through Amazon, the platform plays to the gut or “large intestine” of humans.[2][19] Individuals are biologically programmed to survive and believe the idea that less is bad and more is always better.[2] Their monopolization of e-commerce makes it near impossible for independent merchants to compete with the company.[5]. In the late 2000’s, for example, Amazon drove an online diapers seller, Quidsi, into selling their company to Amazon by creating a competing product and selling at a loss. Eventually, Amazon’s lower prices caused Quidsi to lose much of its consumer base and were bought out by Amazon[20].

Ethical Concerns: Antitrust

America's growing concern of GAFA's antitrust violations[21]

As international governments struggle to regulate these multinational corporations, the Big Four face many antitrust allegations. Antitrust is legislation that prevents or controls trusts and other monopolies from dominating the market in efforts to promote competition in business.[22] By tax avoidance, privacy invasion, job destruction, and deregulation, the Big Four have become an oligopoly dominating the digital economy and online market.[2][23]

Anti-competitive Practices

GAFA has been accused of anti-competitive misconduct that has allowed them to dominate the market and deter potential competitors. Their increasing usage of big data and machine learning in business practices have allowed GAFA to lock in users and reinforce network effects.[24] In turn, this has deterred market entry as competitors fear GAFA’s market dominance or are bought-out by GAFA before they have the chance to become a real competitor.[24] Each company exhibits a "Winner-Take-All" business model that enables them to rise to the top of the market at the expense of their competitors.[2][24] This economic system has created an oligopoly where the Big Four already dominate the market, making it nearly impossible to dislodge them from their positions.[24]

International governments, such as the U.S. Congress and the European Union, struggle to regulate these multinational corporations. Officials launch investigations and file lawsuits against the Big Four in attempts to regulate their behavior and promote fair competition within the digital economy. However, the Big Four have become so large and powerful that legal consequences leave them unphased as they pay the large-sum fines and continue on with their anticompetitive practices.[7][25]

Big Data & Privacy Violation

Like much of big tech, GAFA utilizes its user’s data and private information to predict trends, sculpt user behavior, influence public perceptions, and financial profit from selling this data to third parties. As predicted by French theorist Jean-François Lyotard, the commercialization of knowledge causes shifts in how knowledge and information are valued and shapes social, political, and economic behaviors of society.[26][27] The Big Four are able to take user data, analyze it, and display it back to the individual in a manner that sculpts consumer perspective to align with corporate goals. Consumers see what GAFA wants them to see. Their utilization of intellectual property rights results in data manipulation that edges a digital divide between those (GAFA and big tech) who capitalize on data and the users who provide the data.[27][28]

However, some believe that because GAFA has designed the infrastructures and tools that make data usable, they hold the “moral right to profit from data”.[27] The analysis and use of data is architectured into the design and business process of these companies; without the use of data, they would be unable to operate.[29] The Big Four's software and hardware infrastructure are reliant on their ability to deliver specialized content and services to internet users.

References

  1. Cambaceres Avocat. "The GAFA: are they our best enemies?", 11 April 2019, https://cambaceres-avocats.com/en/the-gafa-are-they-our-best-enemies/
  2. 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 Galloway, Scott. The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google, Random House, 3 October 2017
  3. The Wall Street Journal. "The New Online Wars", 8 June 2011, https://www.wsj.com/articles/SB10001424052702303657404576362861950356484
  4. Pasquale, Frank. "From territorial to functional sovereignty: The case of Amazon", Law and Political Economy, 6 December 2017, https://lpeproject.org/blog/from-territorial-to-functional-sovereignty-the-case-of-amazon/
  5. 5.0 5.1 King, Cecilia & McCave, David. "House Lawmakers Condemn Big Tech's 'Monopoly Power' and Urge Their Breakups", The New York Times, 6 October 2020, https://www.nytimes.com/2020/10/06/technology/congress-big-tech-monopoly-power.html
  6. Statista. "Market capitalization of selected U.S. tech and internet companies in 2006 and 2020", June 2020, https://www.statista.com/statistics/216657/market-capitalization-of-us-tech-and-internet-companies/
  7. 7.0 7.1 Schechner, Sam & Pop, Valentina. "Europe's Antitrust Push Against Google Hasn't Dented Its Heft. Can the U.S.?", The Wall Street Journal, 21 October 2020, https://www.wsj.com/articles/europes-antitrust-push-against-google-hasnt-dented-its-heft-can-the-u-s-11603293443
  8. Hartmans, A. (2020, February 12). All the companies and divisions under Google's parent company, alphabet, which just made yet ANOTHER shake-up to its structure. Retrieved March 19, 2021, from https://www.businessinsider.com/alphabet-google-company-list-2017-4#google-adsense-lets-publishers-earn-money-from-online-content-placing-ads-on-publishers-webpages-advertising-drives-the-majority-of-revenue-for-google-29
  9. Brandom, R. (2019, May 07). There are now 2.5 billion active Android devices. Retrieved March 19, 2021, from https://www.theverge.com/2019/5/7/18528297/google-io-2019-android-devices-play-store-total-number-statistic-keynote
  10. YouTube: What Is youtube? (n.d.). Retrieved March 19, 2021, from https://edu.gcfglobal.org/en/youtube/what-is-youtube/1/
  11. Google adsense - earn money from website monetization. (n.d.). Retrieved March 19, 2021, from https://www.google.com/adsense/start/
  12. Chris, A. (2019, December 02). How does Google Adsense works. Retrieved March 19, 2021, from https://www.reliablesoft.net/how-does-google-adsense-works/
  13. AAPL.O - Apple inc profile. (n.d.). Retrieved March 19, 2021, from https://www.reuters.com/companies/AAPL.O
  14. Department, P., & 22, J. (2021, January 22). IPhone sales by year. Retrieved March 19, 2021, from https://www.statista.com/statistics/276306/global-apple-iphone-sales-since-fiscal-year-2007/#:~:text=In%20their%202018%20fiscal%20year,more%20than%20217%20million%20iPhones
  15. Kastrenakes, J. (2021, January 27). Apple says there are now over 1 billion active iPhones. Retrieved March 19, 2021, from https://www.theverge.com/2021/1/27/22253162/iphone-users-total-number-billion-apple-tim-cook-q1-2021
  16. Apple revenue 2006-2020: AAPL. (n.d.). Retrieved March 19, 2021, from https://www.macrotrends.net/stocks/charts/AAPL/apple/revenue
  17. Facebook: What is facebook? (n.d.). Retrieved March 19, 2021, from https://edu.gcfglobal.org/en/facebook101/what-is-facebook/1/
  18. Blacker, Adam. "Worldwide & US Download Leaders 2020", Apptopia, 7 January 2021, https://blog.apptopia.com/worldwide-us-download-leaders-2020
  19. Statistica. "Most popular online retail websites worldwide in 2020, by average monthly traffic", 2020, https://www.statista.com/statistics/274708/online-retail-and-auction-ranked-by-worldwide-audiences/
  20. Lecher, C. (2019, May 13). How low prices could make for an antitrust case against Amazon. Retrieved March 19, 2021, from https://www.theverge.com/2019/5/13/18563379/amazon-predatory-pricing-antitrust-law
  21. McCabe, David. "America’s Top Foundations Bankroll Attack on Big Tech", 10 December 2019, https://www.nytimes.com/2019/12/10/technology/americas-top-foundations-bankroll-attack-on-big-tech.html
  22. Merrium-Webster. "Antitrust", n.d., https://www.merriam-webster.com/dictionary/antitrust
  23. Smyrnaios, Nikos. "L'effet GAFAM : stratégies et logiques de l'oligopole de l'internet", Communication & Languages, 2016, https://www.cairn.info/revue-communication-et-langages1-2016-2-page-61.htm
  24. 24.0 24.1 24.2 24.3 Barise, T.P. & Watkins, L. "The Evolution of Digital Dominance: How and Why We Got to GAFA", Digital Dominance, 2018
  25. Federal Trade Commission. "FTC Sues Facebook for Illegal Monopolization", 9 December 2020, https://www.ftc.gov/news-events/press-releases/2020/12/ftc-sues-facebook-illegal-monopolization
  26. Lyotard, Jean-François. The postmodern condition: A report on knowledge. (Translation from the French by Geoff Bennington & Brian Massumi), Biddles, 1979
  27. 27.0 27.1 27.2 Prainsack, Barbara. "Data Donation: How to Resist the iLeviathan", The Ethics of Medical Data Donation, 2019, https://www.ncbi.nlm.nih.gov/books/NBK554068/pdf/Bookshelf_NBK554068.pdf
  28. boyd, dana & Crawford, Kate. "Critical Questions for Big Data", 2012, https://www.tandfonline.com/doi/pdf/10.1080/1369118X.2012.678878
  29. Metcalf, J., Moss, E., & boyd, d. "Owning Ethics: Corporate Logics, Silicon Valley, and the Institutionalization of Ethics", Social Research: An International Quarterly, 2019, https://datasociety.net/wp-content/uploads/2019/09/Owning-Ethics-PDF-version-2.pdf