> but in general the top US tech companies... are too big
> I think most people can accept that there's a risk to consumers, markets, and democracy if companies become too big.
I don't think that's true at all. If you want to make an argument that companies are too big, you need some exact logic to support it.
The only solid arguments I'm aware of are specifically regarding banks because of their systemic impact on the economy -- the become "too big to fail" and thereby become a moral hazard situation. Although given the efficiencies of large banks, the solution has become to regulate them more tightly to prevent moral hazards, not to break them up.
But the idea that tech companies are too big doesn't have the same kind of logic behind it, and your assertion that they "snuff out entire startup sectors" doesn't seem to be supported by any evidence. To the contrary, they invest in entire startup sectors and competing top tech companies buy competing startups to supercharge them. Competition is thriving as the big tech firms compete with each other.
In the modern era of Big Tech, consumers seem to be doing great, markets seem to be doing great, and Big Tech's size is probably not even in the top 50 threats to democracy. The effects of social media is surely in the top 5 threats to democracy, but that has nothing whatsoever to do with the size of the company that owns a social network.
Big Tech companies have a history of buying smaller tech companies and ending or decreasing the products/services that the smaller companies provided which makes life worse for consumers.
In game development specifically there's a line of successful studios that were devoured and their game franchises destroyed or made creatively poorer.
My question is always: why did they sell? I suppose a small company is usually private, so it can't be a target of a hostile takeover.
The owners likely saw it as a better deal financially. Sad but usually true.
I like the idea of "meat" and "milk" startups, like cow breeds; "meat" companies are created to grow fast and be sold (and usually butchered), and "milk" companies are kept more stable and independent, to fulfill their purpose, not (just) in hopes of a purely financial gain.
> I don't think that's true at all. If you want to make an argument that companies are too big, you need some exact logic to support it.
It's well known that oligopolies are bad for efficient pricing, just like with (though not as extreme as) monopolies.
That's why EU competition law rightly focuses on "significant market power", rather than US competition law which cares little unless there is a literal monopoly. (Currently, the UK retains EU competition law).
When resources of a private company seriously outweigh those of a government, it may become a problem; see "banana republics" [1]. That is, regulations cannot work against a sufficiently overwhelming force.
"Snuffing entire sectors" is unlikely, even though buying and shutting down a potentially viable competitor is not uncommon in the business world. Google in particular bought and eventually closed a number of startups, but, to my mind, it was mostly because they did not happen to be fast enough growing, not to kill competition. There is some research [2] showing that companies do buy other companies to kill a competitor, but this is very far from being the majority of cases.
Organic growth towards computing and digital does that. Time spent online is increasing, services are getting better, people are moving to the cloud from on-prem etc. etc.
It's not a zero sum game right now. The moment FAANGs are in a zero sum game trying to cannibalize each others' market shares I predict HN won't even have an argument around if tech firms are too big. That means tech has plateaued and has become a mature business like Coca cola or Kroger.
Why is profit a metric that you want to minimize? Do you have any other metric that shows lack of competition? Because the above poster outlined some pretty strong positive ones
Vendor lock-in. Planned obsolescence. Common, established features being removed in favor of proprietary protocols or connectors. Data privacy violations.
All of that because we like free/cheap stuff. Saying Big Tech is good to consumers is like saying Big Pharma is good because their opiods are chemically pure.
My big concern with large companies is cross-selling. For the sake of argument, let's assume that Google rightfully won the Internet, Apple rightfully won smartphones, Microsoft rightfully (?) won operating systems, etc.
All of them tried, competition was hot, the market picked a winner.
But what's next is a market distortion. Google uses their front page to push Chrome over Firefox, Apple doesn't care to make any of their other devices (e.g. Watch, HomePod) interoperate with other platforms, Microsoft packs Windows with ads for Office 365, OneDrive, and so on. All of Big Tech is perpetually obsessed with owning platforms as opposed to products, because once you control a platform, it gives you the leverage/"moat" to continue profiting without the corresponding investment into competing fairly. Thriving competition would be to have to compete independently in each market, rather than winning one and then extending that win to other markets by tilting the playing field.
Activision Blizzard falls nicely into this category as it's explicitly designed to gain an edge over Sony in gaming. Cloud gaming or not, it's clear to everyone that the general idea is improve the standing of Xbox products and Windows PCs by using the leverage of CoD as an existing market winner. As opposed to making the platform compete on its own terms. That's a market distortion.
The fact that large companies put large amounts of resources into startups and developing new markets doesn't mean that they compete fairly, or that it's a better outcome for society/consumers than an alternative reality where each product by itself would compete on its own merits, and companies could win markets independently rather than having to sell to existing market leaders for extra leverage.
> I think most people can accept that there's a risk to consumers, markets, and democracy if companies become too big.
I don't think that's true at all. If you want to make an argument that companies are too big, you need some exact logic to support it.
The only solid arguments I'm aware of are specifically regarding banks because of their systemic impact on the economy -- the become "too big to fail" and thereby become a moral hazard situation. Although given the efficiencies of large banks, the solution has become to regulate them more tightly to prevent moral hazards, not to break them up.
But the idea that tech companies are too big doesn't have the same kind of logic behind it, and your assertion that they "snuff out entire startup sectors" doesn't seem to be supported by any evidence. To the contrary, they invest in entire startup sectors and competing top tech companies buy competing startups to supercharge them. Competition is thriving as the big tech firms compete with each other.
In the modern era of Big Tech, consumers seem to be doing great, markets seem to be doing great, and Big Tech's size is probably not even in the top 50 threats to democracy. The effects of social media is surely in the top 5 threats to democracy, but that has nothing whatsoever to do with the size of the company that owns a social network.