That's how U.S. Senator Elizabeth Warren began her explosive big tech takedown proposal on Medium on March 8.
Twenty-five years ago, Facebook, Google, and Amazon didn't exist. Now they are among the most valuable and well-known companies in the world. It's a great story — but also one that highlights why the government must break up monopolies and promote competitive markets.
Needless to say, it got a whole lot of attention, especially in the tech press. Since then, Warren, who has a long history of consumer advocacy, has expanded and elaborated on who she's targeting and what she means, especially when it comes to Apple and the App Store.
Including in an interview on The Verge that went live just last night, with my guest on today's show, Editor-in-Chief of the Verge, Nilay Patel.
Here's what I asked, and what I asked (loosely transcribed):
For anyone who may not be familiar with it already, Warren's plan sounds simple: Take tech companies that make over 25 billion a year, that own their own platforms, and that do business on those platforms, and split them up. And she named Facebook, Google, and Amazon right off the top, though obviously Apple and others are in that zone as well. Is that it, or does it go deeper than that?
Reading through the material, it strikes me that she's actually — and a realize a lot of this is off the cuff in interviews like the one she just did with you — talking about different things with different companies. For example, she talks about Amazon not selling its own house brands in its own online store, but for Facebook, she's talking about something I want to say a bit more traditional: Breaking the Instagram and WhatsApp acquisitions back off. Or am I getting that wrong?
Some of these are a lot easier to sort of mentally model out than others. Like, if I was suddenly put in charge of this, breaking Google Search apart from YouTube, which is also a massive search engine, and maybe Android and Nest, is sort of intuitive the same way Facebook is with Instagram or WhatsApp. Breaking Amazon the store away from Amazon Web Services, I'm not so sure about.
Apple put a lot of apps into the App Store just so they either wouldn't take up space as bundled-in, or you could — finally — delete them but get them back if you ever wanted to. It's probably trivial for Apple to go back to bundled-in to avoid having any apps on the App Store. But what could, for example, Nintendo or Microsoft or Sony do with consoles and first-party titles? Spin-off game studios, available for all consoles?
You brought up the grocery store analogy in your interview as well, but while smaller, local stores wouldn't hit the 25 billion level, it's not hard to extrapolate the platform argument to Walmart, maybe Costco and Target, and the idea of house brands. Obviously, those retailers have access to quote-un-quote platform data and shelf positioning far beyond any third party brand. I don't know if that's an argument that it doesn't work or that it just doesn't go far enough yet?
You also mentioned railroads and ISPs in the interview, and I remember AT&T being broken up, and now it's merging with Time Warner, and all over the place we have companies spinning up their own streaming platforms with their own original content alongside, in many cases, some form of catalog content. Disney with its parks, movies, shows, studios, and the list goes on and on. It feels like the whole concept of platform is both bigger and more slippery… and — I don't want to say nefarious, maybe a little more under the radar than is good for consumers?
Internationally, it's hard for me at least to see China or Korea do something similar with the Baidu/Weibos, Huawei's, Samsungs, and other conglomerates. If this because a U.S. only initiative, do you think that would hurt or help in terms of international competition?
Does this come off to you more as actual policy or big vision conversation starter stuff? I mean, breaking up Amazon, Google, Facebook, Apple, and potentially others, that's huge headlines, and that's fine, but it's also the easy part. Much easier than figuring out all the details and mechanics. What's your sense of where it goes from here, if anywhere?
Hit play on the video above to hear the discussion.
Now, knee-jerk reactions to this stuff are easy. Of course, they shouldn't break up Apple. Or Nintendo! Or insert my favorite company here! But they should break up Facebook! Or Google! Or whatever company I don't like as much!
And you start to see that these aren't partisan or even political questions, though their implementations will necessarily become just that. In fact, they're practical questions.
So, ahould Facebook be broken up? Should Google or Amazon? What about Apple or Microsoft? Walmart or Costco? AT&T or Comcast?
And, be honest, does the answer depend more on how much you like the company than the actual power they have in the market and over our lives?
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