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Why Startups Aren't Pushing the Feds To Break Up Big Tech (axios.com)
An anonymous reader shares a report: Today's tech startups have largely stayed out of the debate over whether antitrust law should be used to humble -- and possibly break up -- giants like Facebook, Google and Amazon. Startups are often in position to lead the antitrust charge against major competitors. But entrepreneurs face a dilemma: If they go running to regulators, they have to admit they're in danger and tick off a powerful player in their world. If they do nothing, they risk bleeding out.
[...] Tech giants have immense leverage over startups. "The tech hypercaps have never been more powerful relative to startups, including Microsoft in the '90s," said Sam Altman, the president of startup accelerator Y Combinator. "[T]he resources are so mismatched it's an unfair fight." Startups (or larger competitors) can confidentially press their case before staff members at the Department of Justice or the Federal Trade Commission, or the startups can go public with their concerns. With the exception of Yelp, there are no major startups in the U.S. that have turned to regulators to take on today's biggest companies, like Facebook, Amazon, or Google. [...] Why startups don't lodge antitrust complaints: "Running a startup, running a growth company there's so many things to do, and every hour is precious," said Albert Wenger, a managing partner at Union Square Ventures.
[...] Tech giants have immense leverage over startups. "The tech hypercaps have never been more powerful relative to startups, including Microsoft in the '90s," said Sam Altman, the president of startup accelerator Y Combinator. "[T]he resources are so mismatched it's an unfair fight." Startups (or larger competitors) can confidentially press their case before staff members at the Department of Justice or the Federal Trade Commission, or the startups can go public with their concerns. With the exception of Yelp, there are no major startups in the U.S. that have turned to regulators to take on today's biggest companies, like Facebook, Amazon, or Google. [...] Why startups don't lodge antitrust complaints: "Running a startup, running a growth company there's so many things to do, and every hour is precious," said Albert Wenger, a managing partner at Union Square Ventures.
... funded by the same folks who also have stock in Big Tech.
Why would they push to break up their own venture capital?
What would you rather do? Win the "good" fight, or work a few years, sell for a few billion dollars and be able to retire young and never have to work again?
I know which lines I'd be in....I'd be in the LOOOooooongggg line.
(with apologies to Richard Pryor).
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
The goal of every startup is to get purchased by one of the big five. This will surely end well.
Most startups today play in the Niche between the Gaps of the big companies.
There is no way I can out Google Search Google, or be more popular then Facebook.
But I can work with Google use their tools to create and sell products that isn't in Google scope, which I can sell to a smaller group of people who really wants it.
Fighting big tech will only kill off a lot of your functionality and ability to make a good product.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
The biggest reason is the end goal of most startups is to be acquired by one of the hypercaps.
is to get bought out by big tech. Startups don't produce products much anymore, they produce engineers who get bought out. It's less about starting your own business and more about a really, really long job interview.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
The goal is not to create a competitor for Google. The goal is to be bought by Google for a couple billions and have more money than you can spend in a lifetime.
Competing with someone is hard. And risky. Now why would anyone want that?
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
Yesterday’s outage on google app engine proved my point. the big companies need breaking up and so do their ceos.
Why would startup want to risk annoying big players when the goal of a tech startup is to be bought by a big player?
We remember the time when MySpace was king and Facebook was a startup and Zuckerberg was a nobody. Or we remember MySpace knocking off Tribe, which knocked out Friendster, which stole away all of the LiveJournal user base.
Or we remember when Google was just a cute misspelling of the word for a 1 followed by 100 zeros, and we did our searching with Lycos, AltaVista, LookSmart, AskJeeves, or just welled on the Yahoo directory to find cool pages.
Or we remember when Microsoft was the unstoppable evil empire. And Apple was "beleaguered" and Mikey Dell was threatening a hostile takeover so he could "shut it all down and refund the money to the shareholders."
Or we remember when there was no Amazon and Barnes & Noble and Borders were the monolithic behemoths putting neighborhood bookstores out of business.
The real oldsters remember the days of IBM being the evil empire that even the US government was incapable of reigning in, and no one would buy a computer named after a fruit, and Gates and co. were rotting in a New Mexico desert writing an OS for a computer that communicated vis das blinkenlights.
Dominance in tech is fleeting, and has been for at least 50 years. I expect most startup founders are as aware of that history as anyone. And they probably all have dreams of. themselves, being that scrappy underdog that punches out an established player to become the king of the mountain. So it shouldn't be too surprising that they're wary of inviting the government in to interfere.
Imagine all the people...
I think this is just the "temporarily embarrassed millionaires" concept on a corporate stage. If your start-up is going to be "the next big thing", you do not want to shoot yourself in the foot by limiting your ability to grow.
many times the funding has come from them too...why is this bad anyhow? no one has stated that in any realistic terms.
nothing to see here - move along
my busines model incorporates free access to others APIs. I'm entitled to them. for free. this is america!
"You don't understand. Ferengi workers don't want to stop the exploitation. We want to find a way to become the exploiters."
I think that's one of the strongest insights about capitalism. The only regulations capitalists want are the kind that shut down startup competitors from entering their turf. They have no interest in pushing for or utilizing regulation that goes after large, domineering companies precisely because it encourages regulators to in the future go after them when their goals are reached.
...start ups have aspirations to be as big as Google one day and don't want the precedents set that would prevent them from obtaining their goal.
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
The problem is: anti-trust just serves to shovel money into the pockets of lawyers, lobbiests and politicians. It takes years, even decades to come to an end. Remember the anti-trust hearings against IBM? By the time they were over, they were irrelevant.
What's needed is a simple, objective solution that avoids eternal hearings and court cases. For example, how about the following two rules:
- Any company with a valuation over $x may no longer merge, or acquire other companies.
- Any company with a valuation over $x * y must divest within z months, with the largest resulting fragment is valued under $x.
Valuation of public companies is easy: stock market capitalization. Privately held companies are somewhat more difficult, but they still file financial documents: if valuation is too difficult, one could substitute total turnover. Penalties for failing to divest must be massive: immediate and permanent closure, plus criminal liability for the corporate officers.
What values are reasonable? The threshold needs to be low enough to avoid large monopolies, and also to avoid companies becoming "too big to fail". Lower is better - I suggest that y = 4, and x = $25 billion, putting the upper limit at $100 billion.
Enjoy life! This is not a dress rehearsal.
For a start-up, the question is always, "What are you bringing to the table that the existing players do not?". Are these startups actually better in any way, other than being NOT one of the current big players? I see replacements for the big social media and search being extremely hard for a startup to get a foothold, just because they will probably not have a technical advantage over the big players. Where startups can break in is the way they always have, coming up with a better implementation of current ideas, or to bring something really new to the table that is not currently out there but that people WOULD see as an obvious benefit.
When it comes to online stores, you have companies like Amazon, but you also have companies such as Newegg, B&H Photo Video, and others that also have amazing turnaround time on orders, so Amazon does not have the market cornered. In the same way that wannabe politicians can't go for longer than one or two terms by simply NOT being a disliked politician, companies can't expect to do well by not being one of the big players, so innovation is key.
Invent something, make it new, and make it useful. There are cases of anti-competitive behavior, but then, there is just the case where most new businesses just don't have a terribly interesting product or concept. Don't blame successful companies if you don't have what it takes to have a competitive product.
99% of startups' big dream is to get bought by Google, Facebook, or Apple. That's the business model - make a successful product that fits near the wheelhouse of one of the giants, and just wait for the offer to come in.
You start calling regulators on the guys you want to have buy you, and they're not only not going to buy you, but they're going to put you out of business. There's more profit to be made in the former than the latter, obviously.
1. Startups venture capital (and often board and C-suite execs) are heavily invested in Big Tech (tm), and often funded at least indirectly by it.
2. Startups are able to explore ideas that would be far more costly for Big Tech (tm) to research, with far lower risk to stock value and other bread and butter initiatives, and on the chance that they are successful, are already positioned to be bought out.
Why in the world would there be a push to break up Big Tech?
Check your premises.
Most tech startups don't have a long-term plan. Their intention is to get the attention of one of the big players and get acquired before their lack of long-term planning bites them. They don't want to make it hire for the big guys to acquire all the little guys, because that's their entire plan (at least, that's my experience working at a start-up that got bought by a middle-tier player, that, in turn, got bought by a tech giant).
Like most Slaves, theyre afraid to make noise against their Masters out of fear of losing what little they do have and fear of the whip.
Permen cinta
If they cared about consumers they would use anit-trust laws to break up medical monopolies.
love is just extroverted narcissism
Comment removed based on user account deletion
they don't want to set a presedent,
and they don't have the money to waste
and they're startups with their own goals and visions in mind, mostly short term. Not with the psychopathic intent to become a behemoth monopoly.
Microsoft was Crucified for far less than what apple pulls now, but for some reason it is perfectly fine when Apple does it.
The main reason most start-ups don't go to regulators is pretty simple and direct. They don't want to piss off their future owners. Let's face it. For a lot of start-ups that's the unspoken goal: get bought out by one of the big players for a ridiculous amount of money and either stay on as a figurehead or just go off and play.
I've calculated my velocity with such exquisite precision that I have no idea where I am.
Make a startup, get bought out by Google for $$$,
go and enjoy your new found wealth and leisure,
fuck, that'd really suck
Go well
Why aren't the small startups running to the regulators about the big tech monopolies? Because part of their business model depends on it.
Imagine for a moment your a startup CEO taking a huge risk on an idea. Through hard work and years of direction your company may become successful in the marketplace. The other option of course is you garner the interest of a big wealthy corporation who wants to buy your company outright. Many startup CEO's won't admit this but their companies were designed from inception to appeal to the big players.
So why aren't the little guys complaining about the big guys? Because most of them are hoping that they will get bought out and don't want to piss the big boys off. Pissing off a tech giant is generally a bad idea. First you won't get bought and second you risk that tech giant spending millions just to put you out of business by "competing in the marketplace".
Yeah. If anyone in the govt or BigTech gave a flying f*ck about the landscape for start-ups and the innovation they would bring to the world, they'd abolish software patents, because that is how BigTech actually leverages its Bigness against startups.
Can your startup afford to hand the govt. 40k per Obvious Idea just to acquire some puny patent swords to wield in a war against BigTech's massive, all-pervading nuclear-armed patent porfolios ? Can your start-up afford to defend itself against same?
The reality is, everyone lives only so long as the govt. and BigTech decree they shall be permitted to. Contravene either of them, and you can and will be shut down and there's not a thing in the world you can do abouit it. You live, you eat, you exist all at the pleasure of the despots. Just like in olden times, eh?
Oh, and for the ever-present trolls who say that if you're big enough to be sued for software patent infringement, then you've already made it, here's a movie made just to shut you the f*ck up:
https://www.thepatentscam.com/
A. It wouldn't do any good anyway. When you have pricks like Ajit Pai as government regulators you know you're wasting your breath.
B. Which leaves the B-Plan. In the absence of government regulation there's no way you'll even get as big as Big Tech so the best plan is to keep quiet and hope one day Big Tech buys you out. For the overwhelming majority of tech startups that won't happen. So Big Tech and a few lucky lottery winners and pricks like Ajit Pai win. Everyone else loses.
They don't ask because they know Facebook, Google and Amazon are not monopolies. No one is forcing anyone to use any of the services provided by any one of the big tech companies. The power to use an alternative to any of them is in your finger tips.
With the exception of Yelp, there are no major startups in the U.S. that have turned to regulators to take on today's biggest companies, like Facebook,
It was founded just a couple of months after Facebook. How about this: companies that can't count their birthdays on one hand have to take off the Startup hat?
Yes, you can still string your employees along into thinking they are about to become millionaires, you just can't say Startup!!! while you do it.
Seriously, lobbying/calling/etc takes time away from the necessities of keeping your company alive. What's the ROI in whining to legiglators vs calling another potential client?
"Consensus" in science is _always_ a political construct.