Are Some of the High-Tech Companies in Silicon Valley Getting Too Big?

Many people have looked at companies like Google and believe it is getting too big, and it is so well vertically and horizontally integrated, and that it is pushing the limits of antitrust laws in the US. In fact, it has already caught the attention of regulators on more than one occasion, and one has to ask when is enough; enough? Should Google be broken up, and should it be challenged by the Federal Trade Commission, as Microsoft was?

Obviously, there are lots of politics involved, and Google has done very good in its lobbying efforts to Congress, so it may be able to avoid such regulation in Washington DC, but it’s hardly alone in this problem. Consider if you will Facebook or Apple, or what about Amazon suggested a recent Wall Street Journal article – they too are in unfamiliar territory, and this raises people’s eyebrows, that is to say people who understand antitrust laws in the United States, and how they are selectively enforced.

There was an interesting article in the Wall Street Journal in November of 2010 titled; “In the Grip of the New Monopolists – Do Away with Google? Breakup Facebook? We Can’t Imagine Life without Them – And That’s the Problem,” by Tim Wu. This article was an editorial, but Tim Wu brings up a very good point, and I think I’d like to recommend his book, which is very good also; “The Master Switch: The Rise and Fall of Information Empires.”

And even if we are not concerned too much with these particular companies, because they do provide a tremendous amount of value online, we must also understand what they’re doing to the marketplace for innovative thought leaders. Because they are taking all the best talent in Silicon Valley and other places, and they are making it harder for other companies to compete for that same talent. If you work at a place like Google, Apple, Facebook, Microsoft, or Amazon you can command a tremendously excellent salary. It would be hard for other industries to match that, or pay you for that type of talent.

In fact, in another interesting set of articles also in the Wall Street Journal it really gets you thinking. First, I’d like to recommend that you read an article by Martin Peers, also published in November of 2010 titled; “Searching Google for Pay,” and “Google Battles to Keep Talent,” by Amir Efrati and Pui-Wing Tam. Both of these are significant points of contention, and they speak to the overall size of these companies, and the challenges they are having in the marketplace, and how that affects the rest of the innovative companies out there.

Indeed, I hope you will please consider this and if you have other thoughts on these types of subjects, please shoot me an e-mail, because I like to discuss it with you. Think on it.