From Quartz, January 25:"The owners of the platform giants consider themselves the masters of the universe, but in fact they are slaves to preserving their dominant position. It is only a matter of time before the global dominance of the US IT monopolies is broken. Davos is a good place to announce that their days are numbered."
At Davos, George Soros tears into Facebook and Google
Davos, SwitzerlandFinancier and philanthropist George Soros criticized Donald Trump and Vladimir Putin at his annual Davos dinner, decried the state of global democracy, and warned about the rising threat of nuclear war.
While his words were certainly chilling, Soros has sounded some of these warnings before. This year, though, he flagged a brand new threat—the unchecked power of Google and Facebook, which Soros feels now have “monolithic power” that they’re using to manipulate and deceive consumers. The net result could be totalitarian control, Soros said. Here is a transcript of his full remarks on the topic:
These companies have often played an innovative and liberating role. But as Facebook and Google have grown into ever more powerful monopolies, they have become obstacles to innovation, and they have caused a variety of problems of which we are only now beginning to become aware.
Companies earn their profits by exploiting their environment. Mining and oil companies exploit the physical environment; social media companies exploit the social environment. This is particularly nefarious because social media companies influence how people think and behave without them even being aware of it. This has far-reaching adverse consequences on the functioning of democracy, particularly on the integrity of elections.
The distinguishing feature of internet platform companies is that they are networks and they enjoy rising marginal returns; that accounts for their phenomenal growth. The network effect is truly unprecedented and transformative, but it is also unsustainable. It took Facebook eight and a half years to reach a billion users and half that time to reach the second billion. At this rate, Facebook will run out of people to convert in less than 3 years.
Facebook and Google effectively control over half of all internet advertising revenue. To maintain their dominance, they need to expand their networks and increase their share of users’ attention. Currently they do this by providing users with a convenient platform. The more time users spend on the platform, the more valuable they become to the companies....MUCH MORE