Slightly tangential thought: My belief is: legislation needs to either make it just as hard to merge two companies as it is to unmerge them, or make it just as easy to unmerge two companies as it is to merge them. It's insane to me that for how often companies merge and cause competition issues, we effectively never see the opposite happen. I know there's a ceremonial approval for merging two companies (at least in t…
You're basically advocating for unscrambling the omelet to be easier. Should be obvious why it's harder to unmix than it is to mix.
Google avoids a breakup of its ad tech business
221–230 of 383 posts
Re: Google avoids a breakup of its ad tech business
#222Earlier quoted context omitted.
You can bet that if the board of directors could show that unscrambling the omelet would result in greater shareholder value produced, it would suddenly be really easy to do...
Happened with Dow-Dupont! A three-way split, even (from a two-way merger). Took roughly two years and was the shareholders' plan from the start. By most accounts it went very smoothly. [1] https://www.investors.dupont.com/news-and-media/press-releas... [2] http://www.dow-dupont.com/
Re: Google avoids a breakup of its ad tech business
#223Earlier quoted context omitted.
Hot take? But I think antitrust trials should not he subject to settlement. It only proves to reinforce the accusations when a company is big enough to pay off the government.
...then how do you maintain an adversarial proceeding? Like, it's a pretty basic part of American law that courts only hear "cases and controversies" - that is to say, you need to have two parties who disagree before judges are allowed to do anything. If both parties no longer disagree, a settlement is how they call the lawsuit off. But if they're not allowed to settle... what happens? Are we going to force both part…
It's the government as a prosecutor. If current teams are compromised, they find a different team.
This isn't like some law firm with an interest to keep their own lights on. A government prosecution against a threat to labor and economic markets should be to close whatever loopholes lead up to this point.
>The reality is that the current social class of lawyers and judges hate antitrust. They successfully recast it from an argument about market power to an argument about price controls, and well, most monopolies don't actually raise prices[0], so building a case against them is very difficult.
Sounds like a compromised DoJ in that case. Which is definitely the case in the modern day.
But the monopoly argument doesn't hold weight. Some aspects of life are best run as monopolies. But such businesses are highly, highly regulated to prevent the downsides of unbridled capitalism. Big tech is not regulated at all in terms of pricings. And thus we're seeing the results of that in real time.
>While courts are ostensibly neutral arbiters of law, they bend to the fiscal interests of the nation and are inherently political entities, because courts have no inherent power but what they are given by the state.
Sounds like a fancy way to say "big companies always bribed the courts". It's in economic best interest to have a free flow of competition. But it's in individuals' best interests to have good relationships with the biggest winners. The claim of 'interests of the nation' contradicts the fact that being soft on anti-trust betrays such interests.
Re: Google avoids a breakup of its ad tech business
#224The United States government is fractured and can't get its act together. No one has a credible plan to solve this. Electing your preferred president doesn't solve a broken Senate and other structural problems. The presidency is likely to keep bouncing between parties that care as much (if not more) about undoing the previous four years as they do sketching out a coherent plan for the future four. How is wielding thi…
> How is wielding this weapon against our most innovative companies going to help the United States compete at scale against China? Scale is sort of required to do so. Meta and Google gobble up an absolutely gobsmacking duopolist's share of western world's economy each year. Meanwhile, two other American companies without monopolies are ahead of them in the frontier model race. Why do you think that is?
If you think Google (or any large firm) is going to be by necessity be a loser in the AI race relative to smaller firms, you should go ahead and explain why you think that is.
Re: Google avoids a breakup of its ad tech business
#225The United States government is fractured and can't get its act together. No one has a credible plan to solve this. Electing your preferred president doesn't solve a broken Senate and other structural problems. The presidency is likely to keep bouncing between parties that care as much (if not more) about undoing the previous four years as they do sketching out a coherent plan for the future four. How is wielding thi…
A theory behind busting trusts is that monopolies stifle innovation, and thus growth, in the long term. When it comes to "competing with China" (which, to be naive, I'm not sure the meaning of), many nationally competing firms will have a better result for future consumers than if there were a single "national champion." Here is an hour long video where Lina Khan makes this point to the Council on Foreign Relations m…
By "compete with China" I mean at least have parity of competition with China in the essential technologies of the future, rather than falling behind into some sort of obsolence or inability to shape the global economy we all on the whole benefit from. If China becomes the dominant economic hegemon without a viable American competitive check, I think the world (and certainly Americans) will be worse off.
Meanwhile, a balanced competition between the US and China I think will benefit almost everyone on the planet, for reasons likely not that unlike what I expect Lina Khan will say in that video. There is no perfect solution, so I will look forward to hearing more of her perspective on this issue, thanks.
Re: Google avoids a breakup of its ad tech business
#226Slightly tangential thought: My belief is: legislation needs to either make it just as hard to merge two companies as it is to unmerge them, or make it just as easy to unmerge two companies as it is to merge them. It's insane to me that for how often companies merge and cause competition issues, we effectively never see the opposite happen. I know there's a ceremonial approval for merging two companies (at least in t…
Re: Google avoids a breakup of its ad tech business
#227Earlier quoted context omitted.
The money is nbd, but it's much more important to Google (same as it would be for any of the other tech giants) to keep a certain streak going - 42 years now and counting since the government forced a large or important company to do anything even resembling breaking up. A loss here would serve as precedent (either legally, or at minimum in people's emotions) that you CAN force a divestiture. If Google can be forced…
Microsoft got pretty close to getting broken up in 2000, but settled in time to avoid the split
Re: Google avoids a breakup of its ad tech business
#228Earlier quoted context omitted.
> How is wielding this weapon against our most innovative companies going to help the United States compete at scale against China? Scale is sort of required to do so. Meta and Google gobble up an absolutely gobsmacking duopolist's share of western world's economy each year. Meanwhile, two other American companies without monopolies are ahead of them in the frontier model race. Why do you think that is?
I believe this question rests on a few faulty assumptions of the state of the AI race. Including the value of any particular snapshot in time when it comes to judgements about "who is ahead". And also failing to mention Google is an investor in at least one of the "two companies" I believe you are specifying. If you think Google (or any large firm) is going to be by necessity be a loser in the AI race relative to sma…
My point is that Meta and Google have had an almost comical resource advantage when compared to all of the rest of the firms in the AI race.
Anthropic raised $65 billion this year, meta is spending double that on capex and alphabet 3x.
That's just their capex.
If you also factor the deadweight loss the duopoly imposes on the entire economy, it paints a grim resource efficiency picture.
Not to mention the negative externalities caused by the decline of journalism. This one is hard to quantify but I believe is the worst.
Re: Google avoids a breakup of its ad tech business
#229> its ad tech business now there's the euphemism of the day. Alphabet derives 75% of their revenue from Ads. It is their business.
Re: Google avoids a breakup of its ad tech business
#230Arguably tangential, but for how long more will Nvidia and CUDA avoid the US anti-trust?
Why would they be subjected to anti-trust? There's a robust competition from AMD and Intel, and NVidia is not using any obviously illegal competition tricks.