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Is Big Tech actually a big problem?

Written by Paul Jarvis
October 12, 2021 · Return to blog

Lately, “Big Tech” has an image problem.

The companies who were once lauded as saviours to the Western economy, heralds of a new information age, and masters of innovation are now mired in bad press, government regulatory investigations (and rulings) and ever-growing public mistrust.

But why? What changed? Did we all finally learn the truth about these companies, or is it something else that’s tipping the scales against these once-heroes, turning them into villains?

At Fathom, we often talk about being a black hole to Big Tech and often talk about how, as a company, we are proudly small and bootstrapped. And our reasons aren’t just to call out a competitor to gain their market share as a sticky-sales tactic; it’s because we believe that Big Tech isn’t being held accountable on many levels.

Let’s dive into why we (and so many others) feel that Big Tech is no longer the bastion of hope it was supposed to be.

Big Tech vs big scale

Just because a company is massive doesn’t mean it will always lean towards being evil and malicious, right?

Sure, Edward Abbey said that “Growth for the sake of growth is the ideology of the cancer cell.” But surely not everything that’s become large is as horrible as cancer.

I mean, if you think about it, the only reason these Big Tech companies work is because of their grandiose scale. Twitter wouldn’t be Twitter unless there were lots of people talking to each other and following each other on it. Instagram wouldn’t be Instagram if it were just you and your third-cousin posting photos of randomly awesome cats. Amazon wouldn’t be able to offer the prices they do if they only sold half a dozen assorted knick-knacks. And imagine how much that new iPhone would cost if it were a unique, one-off?

Scale is typically required for businesses to function. Scale isn’t inherently wrong either; it’s just the business model needed for certain types of companies. It’s not a crime to be profitable and sizable in a market, either. That’s called “winning” in most stereotypical capitalist circles. And, such size comes with the benefit of network effects—where people and advertisers always flock to where everyone else is hanging out.

Some would say that these data giants are so gigantic because they’ve found a way to serve us so well. They’re widely adopted because we collectively and actively wanted to adopt them. No one forced us to share our thoughts on Facebook, click ads from Google, or buy from Amazon, but appealing factors led us to these companies and kept us there.

Even when we gain knowledge about these Big Tech companies and their practices, we still don’t leave. It doesn’t matter how many antitrust lawsuits, data breaches/leaks, or details come out about their negligence or villainous ways; their platforms don’t ever seem to suffer (both in terms of use by end-users like us and by profit from advertisers).

So equating big with evil doesn’t always cut it. That’s not why many feel these corporations are a problem. What they seemingly do with their size (and the power that comes with it) is an issue.

Big Tech vs big power

Arguments are made daily that Big Tech should be broken up into smaller companies. Even politicians like Elizabeth Warren made breaking up Big Tech a core tenet of her platform when she ran for office (and she’s not the only politician calling for a breakup).

The problem with breaking up “monopolies” is that economists have no consensus that it’d be good or bad for the market to make five big companies into a few dozen smaller ones. It may not have any effect on us, the end consumers, for good or bad.

And yet, each of these companies has been accused of engaging in unfair, monopolistic practices. From brutalizing suppliers and competitors, using questionable tactics in price wars (Amazon has been accused of this often), having high-handed management of platforms they benefit from (like Apple’s App Store) and seemingly endless parades of privacy scandals (Facebook). As these companies cobble up more and more of the market, critics argue that it’s harder for smaller companies to compete—by either buying up competitors, out-buying them with ad spending, and worse. They can copy the best features of their competition with rooms of developers and then hire teams of lawyers to defend any allegations against the copycatery.

Platforms in Big Tech, like Facebook and Twitter, are so ingrained in society, they can wield immense power over it. They can even remove elected officials from having a voice on their platform (whether for a good reason or not). And, they do very little to squash harmful misinformation and conspiracies.

So like being vast has correlation but not causation in regards to being evil, the same applies to power. Having power doesn’t make a company instantly evil (some companies use the power they have from revenues or awareness to generate good in the world); having power does open companies up to misuse it to their advantage, primarily when they use their power to put a small number of shareholders, board members and investors above the needs of consumers or the general public.

Big Tech vs digital privacy

Privacy very obviously hits closest to home for our company, a privacy-first analytics company. We compete directly with Google Analytics on the premise that people actually do care about protecting their digital privacy and the digital privacy of their website visitors—and people should pay for software with money, not data. It’s why we exist as a business.

For the most part, Big Tech’s products have been widely adopted because they don’t charge for them. The main Google and Facebook products are entirely free to use (in terms of money, that is). They don’t charge consumers to use their platforms because that’s not their business model. Their business model is our collective data, and they make billions from it. So much so, that they don’t need to have a monetary fee on our end to make it worth wild on their end. This is the main reason why 86% of websites use Google Analytics, because it doesn't cost anything monetarily—instead, you pay for it with data.

Collecting data isn’t inherently evil either. Fathom collects data too, that’s the point of website analytics, after all. But we actively practice anonymization and minimization of data. Meaning, we don’t want to know personal details about website visitors or even track them individually—we feel that data in aggregate, collected with privacy in mind, is just as valuable.

A significant problem with data is that it tends to leak. There are data breaches daily, and Big Tech is certainly not immune to them. So the more data you collect, the more data about each of us who use the internet can be leaked.

The other problem with data, as it relates to digital privacy, is Big Tech isn’t exactly forthcoming with what they collect, how they use it, and how much they make off each user on their platform. Sure, we know if we look up shoes on one site, we will be followed around the web with ads for shoes. Still, they collect much more data about all of us, and it’s unclear (as they are opaque about this aspect of their business) precisely what they know, how they know it, and what they do with the data once they have it. With technology like Google’s FLOC, they say they don’t track sensitive data, but in our internal tests, they certainly did use sensitive data to group similar members together, which could lead to dangerous relevations.

The final problem with data being tracked by Big Tech is that there are no mechanisms for consent around it. We’ve never had the option to “opt-in” to this surveillance; we’ve only (and only recently) been given half-hearted ways to possibly “opt-out.” So we were never asked if their surveillance capitalism business models were ok with us. We were just given terms and conditions to blindly accept, and none of us have the time nor the expertise to read and then understand 10,000 word terms of service.

So whether they’re using our data to provide a genuine benefit or using it to exploit us and re-shape our opinions, we may never know. And, without us knowing what’s collected about us or how it’s used, it’s hard for us to understand how bad or evil or not companies who make data their business model can be.

When collecting large amounts of data, the chances of sensitive or troublesome personal information being included is very high. Because computers can’t assume they understand what this data means. We may search for strollers (harmless, right?) one day and miscarry the next. Or search for wedding venues (also seems innocuous) and go through a break-up the next. Each of us should be allowed to say what data is innocuous and what data is sensitive, because it differs for everyone.

Big Tech vs the summary of this article

So we’ve talked about how immense scale, power, and resources to collect our data don’t make a company evil by default, but for each area, there are a significant number of paths that lead to the dark side and corruption.

Big Tech companies promised to change the world—and they did. Just not in the wholly altruistic ways they promised us. In fact, not many of us would say the world is an entirely better place because of Big Tech. It’s nuanced.

Where I think there’s a problem with Big Tech is around transparency and accountability. Meaning, there’s a lack of transparency in their business model, as in, how they specifically make money off of each user and what exactly they collect from each of us to generate that revenue. And accountability in terms of regulations around their power—whether through government policy or just through litigation. Having power can be fine; having infinite power with no checks or balances seems like a recipe for disaster.

Through policy, litigation or both, a regulatory framework could start to be fashioned based on all of the issues above: data ownership and transparency, power and competition. Not necessarily as a means to break these companies up, but as a means to keep them away from being more evil and more harmful to society.

Perhaps though, this is all temporary. Even the Roman Empire eventually collapsed from its immense weight. After all, none of them are still worried that Microsoft’s stranglehold on the market (like they had in the 90s) should be broken up into many companies because it’s ruining the free market. Remember MySpace? Or AOL? Or Netscape? Or Yahoo? All were thought to be too big to fail and having too much power at their peak.

Maybe it’s just a matter of waiting these Big Tech companies out and hoping the next Big Power isn’t as bad as what we’ve currently got. But in the meantime, a little bit of smart policy and litigation could go a long way—not just for the current superpowers, but for the next ones too.

Posted in news

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