The mistakes companies make over time put them in the crosshairs of the U.S. government for antitrust and monopoly action. Suddenly the heat is being turned up for successful tech firms like Facebook, Google, Amazon, Apple, Twitter and others. While being a monopoly is not illegal, if they are not playing fair or breaking antitrust rules, all bets are off.
Starting out as smaller, entrepreneurial companies, they created their own new space in business and paved their own path to success. They are cheered on by customers, investors, the media and more. Unfortunately, over time this success goes to their heads and often gives many of these hard charging companies and executives a false sense of security.
Facebook, Google, Amazon, Apple, Twitter face antitrust action
It sounds crazy, but the same company that was cheered on to success when they were smaller and innovative, eventually cross over that invisible line in the sand and become a threat that needs to be managed by the US Government.
This is because these new competitors are still managed by the same entrepreneurial mind that started them. While that mind was key to success early on, it can be harmful once they are successful.
A change in leadership thinking is necessary as a company grows, but that is the weak link that causes so many problems. We’ve seen it with countless stories of business success over decades.
Remember the Microsoft story? They grew from a startup in the 1980’s to a powerhouse. Then they were eventually broken up by the US Government in the 1990’s.
There is no problem with being a monopoly. That does not break the anti-trust rules. Companies can be the only one in their space and that is fine as long as they don’t abuse that position.
Abuse is what the U.S. government looks for. Have these companies abused their monopoly positions with relation to the competition, innovation and other marketplace actions. Activities which were once applauded are now not allowed once a company grows.
Today, that even includes political bias which has been raising its ugly head again over the last few years. Companies who play fair, won’t have any problems. Companies who lean one way or the other will face increasing push-back and ultimate regulation.
As this investigation proceeds over the next few years, it will be very interesting to watch how things have changed. I get the sense that all the past yardsticks will be used plus several new ones as well.
Facebook, Google face more antitrust scrutiny
Some of these companies have more to worry about than others. Example, I think Facebook and Google have more trouble ahead than Amazon and Apple. With that said, I think this will be a topic that will be investigated by US regulators over the next few years.
That means things could change. What I mean is sections of companies may be separated from the whole. Think of Microsoft and all their different areas like Windows OS, Word, Powerpoint, Excel, Internet browsers, wireless phones and more. Some of these have been separated.
The result is a fair and open marketplace where competitors can start and grow instead of being cut off at the knees. In fact, breaking a company up may not really hurt as much as you may think.
When monopolies are broken-up they often become stronger
After the first few years of chaos, Microsoft is bigger than ever. Looking back, when AT&T was broken up in the early 1980’s, after several years of chaos they are now bigger and stronger than ever. Same with Standard Oil owned by John D. Rockefeller from way back. The pieces ended up being bigger and stronger than Standard Oil ever dreamed of being.
So, if companies like Facebook and Google are not playing fair, we can expect the US Government to ultimately step in. Will they be broken-up is the next question? This will start years of chaos and uncertainty. However, I believe these companies will not suffer in the long-term.
Either they will stop breaking the rules and be given a second chance or they will be broken up. We don’t yet know what this process will look like with the political bias mess mixed in.
One thing is for sure, these companies have all seen rapid growth and that has given them a false sense of security. Like a stallion, that will be broken.
Companies are run by people and people are only human. Regulators are also human and often don’t see eye-to-eye with the new leaders of business who think they are untouchable.
Tech monopoly reality check coming next
A reality check is coming, and it will be ugly for some companies and executives. It always is. What happens next is the question. Either way, this will be a very interesting next chapter to follow. Just don’t expect a quick resolution. It will take several years to unfold.
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