Yahoo News The Justice Department Finally—Finally!—Takes on Google and the Danger of Monopolies
At its inception, the digital rights movement was mocked for its foolish obsession with the sideshow of online trivialities, the delusion that the rules governing a bunch of Star Trek message boards had some connection with the urgent, innately physical world of human rights.
Fast-forward 30 years and the same people are being mocked as Pollyannas who only saw tech as a force for good and failed to warn us of the risk of impending technological dystopia.
Life isn't fair.
Tech activists didn't have a blind spot when it came to the abusive potential of networked computers—but we did miss a big, important, looming crisis. And to be fair to us, it's one that almost everyone missed.
Monopoly.
Forty years ago, President Ronald Reagan elevated the Nixonite criminal Robert Bork to serve as his court sorcerer. Bork was so revolting that his Supreme Court nomination died in the Senate, but even without a lifetime seat on the bench, Bork managed to have a seismic effect on the nation and the world.
Bork's fundamental belief was that if you stared really hard at anti-monopoly laws like the Sherman Act and the Clayton Act, you'd find that their drafters never really worried about monopolies. Rather, they only worried about harmful monopolies—which is to say, instances in which companies do something nakedly anticompetitive in a way that results in an immediate increase in prices. Bork's big idea was that unless you could prove that some monopolistic crime would raise near-term consumer prices, it shouldn't be prosecuted.
And now, after 40 years of non-enforcement of monopoly laws, the world has:
· five giant publishers
· four giant movie studios
· three giant record labels
· two giant brewers
· one giant eyewear maker
And these companies abuse their power in thousands of ways, as do their cozily monopolistic pals in aviation, accounting, logistics, poultry, groceries, telecoms, agribusiness, and a thousand other industries that owe their collapse into oligarchy to the legacy of Robert Bork and his fantasies about the secret messages encoded in the plain language of American competition law.
The Justice Department's unveiling of an antitrust suit against Google is seismic.
It is clear that Google has a monopoly that it maintains through predatory tactics that were prohibited prior to antitrust's "enborkening." After all, this is a company that has produced between 1.5 and 3.5 successful products in-house: search (1), a Hotmail clone (0.5), and, depending on who you ask, Android (if you believe that the product called "Android" that Google acquired is unrelated to Android as we know it today) and Photos (if you think it has billions of users because it's better than everything else, and not because it comes preinstalled with Android).
The other in-house Google product developments have ranged from ho-hum to flop. The company's successes—notably, its ad-tech stack—were the result of acquisitions through which the company created and maintained a vertical monopoly that captured more and more value from its suppliers and users.
Google's defense against the antitrust suit is the same line that I heard from its founders at conferences in the early 2000s: With competition just "a click away," any success the company has attained should properly be attributed to the delight of its customers, not a high-stakes game of moneyball where monopoly rents from ad-tech allow it to buy its way into the defaults for browsers and operating systems. This is a lot less convincing 15 years on than it was in the noughties.
There's a good chance that Google believes it faces a high risk of breakup, and that the restructuring of the company as "Alphabet" is intended, at least in part, to suggest cleavage lines to trustbusters favorable to the business's interests: "Please Mister G-Man, don't make us spin out the failed smart city division or the novelty wifi balloons!" Anything to keep ad-tech and its affiliated surveillance systems in house.
There's a Silicon Valley consensus that Google survived its infancy because Microsoft elected not to strangle it in its cradle, the way the Beast of Redmond had done with Netscape and other upstarts of the previous decade. This forbearance is attributed to the Justice Department’s long (and ultimately unsuccessful) antitrust action over the Windows monopoly. The theory goes that Microsoft had its predatory spirit tamed after a decade-long regulatory siege and was frightened of what an all-out assault on Google might provoke.
After all, this was Microsoft's own origin story. The company owed its existence to IBM's reluctance to tempt the DOJ's antitrust enforcers by preloading its own operating system on the new IBM PC: IBM had battled the DOJ for a dozen years by then, outspending Justice’s entire antitrust division for every single year of it.
This was the arc of the technologists who started the digital rights movements: getting online on an IBM clone running a third-party OS on wires that had been liberated from AT&T in its 1982 breakup; watching the indomitable force of Microsoft gentled by relentless DOJ enforcement. Those early decades of the networked computing revolution were a time of incredible dynamism, with the giants of the earlier decades humbled, broken, acquired for pennies by upstarts who had been napkin doodles a few years before: Cray, DEC, SGI... Technological dominance was possible, but fleeting.
That was the oversight of the digital rights movement: not the blithe assumption that technology would automatically make us more free, but the assumption that antimonopoly enforcement would check the concentration of corporate power, that the industry would be fragmented, unconsolidated, and that any firm that put technological dystopia in its business model would be challenged by a rival that understood that "not being evil" and "thinking different" would siphon off so many customers that superpredators would wither rather than dominate.
To be fair to my digital rights forebears, that is an assumption that many people and companies made. Robert Bork set in motion an avalanche that started small, but gained ferocious momentum, and by the time it was undeniably bearing down on it, it was a monster.
Oligarchic tech concentration has changed the aspirations of technologists. Only a fool dreams of starting a company that will upset the order. Investors call the businesses that Big Tech dominates "the Kill Zone" and will not back startups that seek to compete with tech giants head on, despite double-digit, year-on-year growth among those firms (Jeff Bezos' motto that "Your margin is my opportunity" only applies to companies Amazon is preying on; Amazon's own margins are sacrosanct).
Today, the best a budding technologist can hope for is to do a fake startup whose "product" exists only to demonstrate that they and their team can successfully complete an ambitious project. These post-grad practicums are the precursor to an "aqui-hire," when a large firm buys out a startup solely to get a proven team, shutting down its products after the acquisition. Venture capital is now a glorified talent agency, and the "acquisition" is split between "investors" and "founders" in lieu of a finder's fee and a hiring bonus.
The dream of "making a dent in the universe" (or even of improving the lives of people with code) has been replaced with kombucha on tap in the company mini-cafe and free massages on Wednesdays. Technologists who came to the work when they experienced the liberating power of computers—the power of code to transform your thoughts into infinite, perfectly repeated work that could be projected around the world; the power of networks to connect you with the people who know the names of the worldless feelings you have grappled with all your life—are now enlisted in computerized control.
The job of a monopolist is to shift risk and cost to the world's side of the ledger, and freedom and profit to the shareholders' side. The job of a coder working for a monopolist is to confiscate the self-determination they themselves derive from technology from their users and deliver it to their bosses.
This situation is reaching a breaking point. Tech workers are resigning, walking off the job, dumping dox on their bosses' sinister plans. They're unionizing, making common cause with low-waged warehouse workers and outsource contractors.
Twelve years ago, I published a technothriller called Little Brother. It was a bestseller, as was its sequel, Homeland, and it told the story of kids who used technology to resist tyranny, after a terrorist attack on San Francisco triggered an authoritarian occupation of the Department of Homeland Security. In the years since, hundreds of technologists, cryptographers, security researchers, human rights activists, cyberlawyers, and others have approached me to say that the book awakened them to the power of technology to liberate us and the terror of technology in service to tyranny. The apotheosis of this was a scene in Citizenfour, Laura Poitras' Academy Award-winning documentary on Edward Snowden, in which Snowden packs the essentials from his Hong Kong hotel room and shoves a copy of Homeland in his go-bag as he flees underground.
I've just published a sequel, Attack Surface, about technologists having a moral reckoning with the consequences of a career spent in service to oppression. In the weeks since its release, critics and reviewers have speculated that this is a reckoning of my own, a belated realization that technology isn't a panacea after all. This was not a realization I had recently: I didn't spend the past 20 years of my life as a digital rights activist because I thought everything was going to turn out fine.
But it is a reckoning of sorts: a realization that the obscure world of competition enforcement was far more important than I gave it credit for, the deep roots of inequality and the perversion of policy in service to shareholders, to the detriment of the public interest.
The DOJ's Google complaint hints at a similar reckoning. The DOJ's lawyers—building on the work of dozens of state attorneys general who have their own parallel claims—have gone to enormous lengths to thread the minuscule eye of the needle that Robert Bork forced all antitrust to fit through.
It's a remarkable feat of legal gymnastics, but more telling is the way we're all talking about the suit: from lawmakers to newscasters, online and in legal circles, there's a tacit understanding that cracking down on Google with the narrow complaint the DOJ brought is like getting Capone on tax-evasion. The real issue isn't "consumer harm," it's dominance.
That mounting understanding, more than anything else, is what gives me hope. We are long overdue for a reckoning with concentrated corporate power in every industry. The entertainment and telecoms giants who are cheerleading a turn in the barrel for their archrivals in Silicon Valley are making a bet that a revitalized, muscular antitrust will neuter tech, and then stop. They're wrong. The momentum building for breakups and other anti-monopoly actions is unstoppable.
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