The case for breaking up Big Tech
When NYU professor Scott Galloway began The Four, his book on Apple, Google, Amazon and Facebook, he thought it was a love letter. Now he says it's time to break up the companies.
Why it matters: In a year where the biggest tech companies have been widely criticized, regulators may have more inclination than ever to look at their business practices.
"I’ve become 100 percent convinced that its time to break these companies up," Galloway said, speaking at the DLD18 conference in Munich. "I want to be clear I love these companies... They are clients of mine, at least for another hour until they see this."
The rationale: "The key to competitive markets is no one company has too much power and we have blown way by that." Galloway notes that Google would have never made it out of the crib if antitrust regulators hadn't put the breaks on Microsoft.
Other predictions: Galloway also used his talk to offer his take on 2018, a year in which he says the following will occur:
- Amazon will pass Apple in value with Alexa helping push the online retailer past $1 trillion in value. He also sees Amazon's media unit passing Twitter and Oath in revenue.
- Twitter, Snap and Pinterest will either be acquired or take on new investment at valuations of a quarter to half of their peaks.
- Amazon will buy either Carrefour or Nordstrom.
- The breakup of Big Tech will begin with inquiries from either a U.S. attorney general in a red state, the EU's antitrust authority, or both.
- Facebook's stock will peak as Mark Zuckerberg "burnishes his reputation as the most tone-deaf CEO in tech."
Last year's picks: Galloway's 2017 predictions were a mixed bag, though he did importantly predict it would be the year that the Big Four tech firms started to get blowback. He also correctly predicted a bust for virtual reality, a decline in wearables, and the year's big winner Netflix.
But he admits he was wrong in calling Walmart's Jet.com buy a bust and predicting falls for Apple and WeWork. His whole talk was powerful (and good fun). You can watch the highlights via YouTube below.