Big tech gave the world some startling numbers this week. In the last three months, Amazon’s sales have averaged over $ 1.2 billion. During the day. It took the company less than four seconds to earn the $ 52,000 that the average American earns in a year. Apple is now sitting on almost $ 200 billion in cash, more than expected this year sale of Covid 19 vaccines.
The corona virus shook the world economy to its core, but for the American tech giants, it has proven a bonanza of historic proportions.
In the back-to-back corporate earnings releases, Google, Apple and Microsoft all reported record quarterly sales and profits. Facebook doubled its profits and reported its fastest growth in five years. In the last three months alone, the five largest technology companies in the United States achieved a total profit of over $ 68 billion.
It did not start that way. When the pandemic raged across America in April last year, Amazon founder Jeff Bezos warned of “the toughest time we have ever faced” and said shareholders should “Sit down”. The company planned to spend 4 billion. Dollars or more in the next three months on coronavirus-related expenses-wipe out all of its quarterly profits.
Shareholders need not have worried. On Thursday, the company announced a profit of 7.8 billion. Dollars after the sale topped $ 100 billion. for the third quarter in a row.
Money has flowed in as Covid-19 transcended the shift to online work, shopping and automation. There are signs of trouble for the technological leaders, but critics worry if the trend continues, we will enter a “Blade Runner future” where our entire lives are ruled by a handful of super-rich, super-powerful companies led by a generation of plutocrats with wealth unseen in human history.
This week, the total fortune of the richest seven billionaires, all big tech titans, passed $ 1 tn for the first time, according to the Institute of Policy Studies’ (IPS) Inequality tracking project.
“We’re looking at a Blade Runner future, a world where a handful of businesses will dominate all economic activity,” said Chuck Collins, senior researcher at IPS. “It’s not only bad for the economy, it’s bad for consumers, for communities and for competition. There is real damage here, ”he said.
When a business is as dominant as Amazon is in online retail, Google in search or Facebook in social media, competition is getting tougher, he said. Their huge piles of money mean they can buy out – a favorite Facebook tactic – or copy new players, investors will shy away from putting money into potential rivals, and entrepreneurs will aim to sell out to their giant rivals rather than take them to themselves.
And next to all this cash comes political power and the means to fight any official or government that challenges them. “We’re creating a political and corporate oligarchy that is fundamentally against healthy democracy and competition,” Collins said.
Academics have long warned that the structure of the digital economy would likely create a “winner takes all” scenario. And there are clear signals that governments around the world are waking up to that threat. Europe in particular has challenged the dominance of big tech and its ability to avoid paying taxes. The United States has been slow to catch up and even recently threatened tariffs on the UK and other countries that planned to impose new taxes on US technology companies.