Tuesday Tech Watch #2

More news about those great big tech companies that have magically avoided antitrust scrutiny, up until now. I put my responses in brackets and italicized.

Tech Goliaths Act Like Davids.

This article is part of the On Tech newsletter. You can sign up here to receive it weekdays.

The American technology industry was built on the white hot rage of underdogs. [Especially Amazon which was built on the white hot rage of unpublished authors who desperately wanted to have their work published in “real books”.]

When Apple was founded, it mocked IBM as a bully that made terrible computers. Pipsqueak Google made Microsoft its mortal enemy. The young Uber hated … everyone, basically. It’s energizing to be the scrappy upstart fighting a rich superpower or the big, bad system.

The technology companies still like to believe that they’re Davids — except many of them are now Goliaths. And the underdog tactics and fighting spirit that once served them well now make these companies look petty and mean.

Allow me to point you in the direction of lawsuits that Amazon has repeatedly filed against employees who leave its cloud-computing business for other jobs.

Read the whole article here.

Amazon Workers Urge Bezos to Match His Words on Race with Action.

SEATTLE — Last week, Jeff Bezos, Amazon’s chief executive, wrote a rare note to all of the company’s employees. His leadership team had been reflecting on the “systemic racism” facing black communities, he said, and he urged employees to take time to learn and reflect on Juneteenth, the holiday marking the end of slavery in the United States.

“I’m canceling all my meetings on Friday, and I encourage you to do the same if you can,” he said.

But some of Amazon’s employees said there was one big problem with his suggestion: For the vast majority of Amazon’s black workers, canceling a meeting is not an option. They work in Amazon’s fulfillment operations, packing, shipping and delivering products to millions of customers.

Several other retailers, like Target, J.C. Penney and Nike, made Juneteenth a paid holiday. At Amazon, many warehouses recognized the day by encouraging workers to dress in black.

“What does a black shirt do for anybody in terms of social justice?” said Adrienne Williams, a black contract driver for Amazon in the Bay Area, who organized a vigil for Juneteenth. Better pay, she said, would do far more. “That would cut down the pre-existing condition that is poverty,” she said.

Ms. Williams and more employees and contractors are arguing that Amazon, one of the nation’s largest employers, needs to do much more to address racial inequality within its own walls. The calls for change — including diversifying its top ranks and addressing racism in its warehouses — have generated an unusual degree of turmoil inside the tech giant.

Read more about it here.

When Bosses Shared Their Profits. (Opinion piece)

After the bruising crises we’re now going through, it would be wonderful if we could somehow emerge a fairer nation. One possibility is to revive an old idea: sharing the profits.

The original idea for businesses to share profits with workers emerged from the tumultuous period when America shifted from farm to factory. In December 1916, the Bureau of Labor Statistics issued a report on profit-sharing, suggesting it as a way to reduce the “frequent and often violent disputes” between employers and workers, thereby “fostering the development of a larger spirit of harmony and cooperation, and resulting, incidentally, in greater efficiency and larger gains.”

That same year, Sears, Roebuck and Co., one of America’s largest corporations, with 30,000 to 40,000 employees, announced a major experiment in profit-sharing. The company would contribute 5 percent of net earnings, without deduction of dividends to shareholders, into a profit-sharing fund. (Eventually the company earmarked 10 percent of pretax earnings for the plan.) Employees who wished to participate would contribute 5 percent of their salaries. All would be invested in shares of Sears stock. The plan’s purpose, according to The New York Times, was to “to engender loyalty and harmony between employer and employee.” In reviewing its first three years, The Timesnoted that 92 percent of Sears’s employees had joined up and that “the participating employee not only found an ever-increasing sum of money to his credit, but eventually discovered he was a shareholder in the corporation, with a steadily growing amount of stock to his name.”

Sears’s plan was admirably egalitarian. Distributions of shares were based on years of service, not rank, and the longest-serving workers received nearly $3 for every dollar they contributed. By the 1950s, Sears workers owned a quarter of the company. By 1968, the typical Sears salesman could retire with a nest egg worth well over $1 million in today’s dollars. Other companies that joined the profit-sharing movement included Procter & Gamble, Pillsbury, Kodak, S.C. Johnson, Hallmark Cards and U.S. Steel — some because it seemed morally right, others because it seemed a means to higher productivity.

Read more here.

Four Top Tech C.E.O.’s Will Testify in Antitrust Inquiry, Panel Says.

WASHINGTON — The chief executives of four of the world’s biggest technology companies will appear before Congress this month as part of its sweeping antitrust investigation into their market power, according to the committee running the inquiry, setting up a high-profile face-off between the companies and skeptical lawmakers.

Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook and Sundar Pichai of Alphabet, which owns Google and YouTube, will appear at the hearing, said Shadawn Reddick-Smith, a spokeswoman for the House Judiciary Committee, which is said to be nearing the end of its investigation.

The date and whether the executives will appear in person or virtually, as has become common during the coronavirus pandemic, are still being discussed, Ms. Reddick-Smith said.

The hearing will allow lawmakers to ask the executives about accusations of antitrust abuses at their companies, all of which are the focus of investigations by federal regulators or state attorneys general. The executives are also likely to face questions about other issues, like Amazon’s treatment of its warehouse workers or the spread of hate speech on Facebook and YouTube.

The hearing would be a central moment in the continuing backlash against the power of major tech companies. Prosecutors at the Justice Department are preparing a possible antitrust case against Google this year, after an inquiry homed in on its control of advertising technology and the search engine market. The Federal Trade Commission is investigating Amazon’s business and Facebook’s acquisition of smaller companies.

A number of state attorneys general are investigating similar issues and could pursue their own actions or work with federal authorities.

It will be the first time that Mr. Bezos will testify before Congress. Mr. Zuckerberg, Mr. Pichai and Mr. Cook have appeared in front of Capitol Hill lawmakers before.

Alphabet, Facebook and Amazon declined to comment on the record about the committee’s plans. An Apple spokesman did not immediately respond to a request for comment. [Alphabet? Who? WTF? As for the rest, it’s about fucking time, huh? I wonder if Congress or the FTC will actually take an action of any kind?]

To read more, just click here.

Here Come the Four Horsemen of the Techopolypse. (Another opinion piece)

You can call it Techpalooza.

The chief executives of four of the most powerful tech companies in the world — Apple, Facebook, Google and Amazon — have agreed to appear in late July before a congressional committee as part of an investigation focused on antitrust.

Representative David Cicilline, a Democrat from Rhode Island who has become one of the biggest critics of Big Tech’s enormous power, told me on Wednesday that Jeff Bezos of Amazon, Mark Zuckerberg of Facebook, Sundar Pichai of Google and Tim Cook of Apple will testify in what could be an all-day event.

Mr. Cicilline said that the yearlong congressional investigation has included eight round-table discussions, 93 requests for information, 43 experts testifying and five hearings.

“It’s the first major look at antitrust in this industry in 50 years and a lot of people worldwide are watching how lawmakers deal with tech,” he said. “But throughout, we know it is impossible to properly conclude this without hearing from the decision makers themselves.”

He said that all of the chief executives agreed to appear voluntarily and that logistics are still being worked out for what he hopes will be an in-person hearing in Washington. But safety concerns over the coronavirus may mean that the executives end up testifying remotely.

And while tech leaders have appeared before Congress in the past — and there is often less illumination than noise at these kinds of hearings — given the growing public alarm about the power of the tech giants, this gathering of the four horsemen of the Techopolypse could be an epic show. Winter may be coming for Silicon Valley.

[Or it could lead to nothing. I think this requires a follow up as to WTF actually gets done.]

Read the entire article here.

And this just in …

Why Big Tech’s Congressional Testimony Will Be a Bust.

Later this month, the CEOs of Amazon, Apple, Facebook, and Google will appear before the House Judiciary Antitrust Subcommittee as part of its investigation into the companies and their dominion over the tech industry. On the latest episode of the Pivot podcast, Kara Swisher and Scott Galloway discuss why the group setting puts lawmakers at a disadvantage, and will likely allow Mark Zuckerburg & Co. to escape serious scrutiny.

Kara Swisher: This is shaping up to be an all-day event with testimony from Mark Zuckerberg, Sundar Pichai, Jeff Bezos, and Tim Cook. Because of the pandemic, it’s still unclear whether they’ll be there live. The executives have all agreed to appear voluntarily, which is controversial. A lot of people think this is not a good idea because they’ll be able to escape scrutiny together, and a lot of people think they should have been subpoenaed so they could be kept there for days and days. So, Scott, what do you think of this?

Scott Galloway: I think we’re already being played. Or I think Congress has already been played. By bringing all four of them, you create this amorphous impression of all of big tech. The reality is it’s kind of the mother of all reduction. Apple is an entirely different company than Facebook. It requires regulation of the app store, or maybe even spinning the chip unit, which no one ever talks about. Facebook should just be broken up and/or face much more severe penalties or even civil or criminal charges. The biggest benefit here, because they are all coming together, is that none of them are really going to be singled out and Congress is not going to get the opportunity to go really deep.

The problems and the remedies for Amazon are just much different than any of the other companies. The real winner is Mark Zuckerberg, because if it was just him solo for two days, it would get really ugly, really fast. There’s going to be safety in numbers. So for them to all show up together, there’s going to be a general assumption and general conclusions around big tech.

Swisher: And they don’t necessarily have to appear in person. I think Jeff Bezos is not going to show up. I think he’s very germ-aware.

Galloway: Is that right? I didn’t know that. I thought he was going.

Swisher: It’s not clear. I just know he hasn’t been seen, if you’ve noticed. Zuckerberg has been a little more seen, but I think they all have an excuse to not come. And I think it’s a good excuse, by the way, not to physically come, even if they tried to do social distancing.

Galloway: Can’t they Zoom in?

Swisher: They can. A lot of people thought Congress should have done one company per day because there are different concerns with each of them. The CEOs probably said, “We’re only going to do it if we do it together.” That makes sense. But it’s interesting, because my feeling is people will attack Zuckerberg, Sundar and Tim will sit in the middle, and they’ll just sort of lick Jeff Bezos up and down.

Galloway: I think that’s right. I think that’s a perfect description.

Swisher: Yeah. So all of them together is not a great thing. At the same time, they’ve never appeared together, so it does put focus on this topic. So maybe that’s really the point here.

Galloway: Yeah. We’ll see. I think we’re going to get played. I think Bezos is going to be —

Swisher: Fantastic.

If you want to read the rest of this drivel, just click here.

Fantastic? You mean like awesome or like he’s not real? I only wish he were someone else’s awful fantasy.

But … again… fantastic?