We call “Big Techs” the largest information technology companies that have dominated cyberspace since the years 2010; among them, Amazon, Microsoft, Apple, Facebook and Google stand out.
They are in the most recent headlines, either because of their extraordinary profits, leveraged by the pandemic, or because of the concerns that they have aroused due to the immense economic, social and political power that they have accumulated.
This power derives from the capacity that these companies have to capture, process and use data that travel over the internet, to the point that Clive Humby, an English mathematician, coined a phrase that became famous: “data is the new oil”.
When linking data and oil, it is worth remembering that until not so long ago, the big oil companies had a role similar to what the Big Techs have today, to the point of one of them, Exxon, which used the Esso brand in Brazil, have been, for about ten years, the most valuable company in the world.
Today, despite continuing to operate, Exxon is worth less than the personal fortune of Jeff Bezos, the founder of Amazon. In addition, its shares recently ceased to be part of the Dow Jones Industrial Average index, which reflects the New York Stock Exchange quotes, after remaining on it for more than one hundred years; were replaced by the shares of Salesforce, a technology company.
Some credit the oil companies’ decline with their slowness in reacting to changes in the scenario, especially the growth of new sources of fossil fuels and alternative energies and the negative image that public opinion has formed about them, especially due to issues of aggression against environment and support for dictatorships in oil producing countries.
Executives and investors in technology companies must be concerned about the death or loss of relevance of their companies, especially because the evolution of technology, coupled with the wrong decisions, may lead these companies to situations like those experienced by oil companies.
Such concerns must be exacerbated by the pressures these companies experience in the United States due to their immense power, which many consider exaggerated. However, this pressure may end up making some of these Big Techs disappear.
It is worth remembering that, in 1984, AT&T, the largest telecommunications company in that country, needed to be divided into several smaller companies, as a way of diminishing its power. The same happened in 1911 with Standard Oil, which, among others, ended up generating Exxon.
It seems that Andy Grove, who ran Intel, was right when he gave his famous book the title “Only the paranoid survive”.
Vivaldo José Breternitz, author of this article, holds a PhD in Sciences from the University of São Paulo, is a professor at the Faculty of Computing and Informatics at Universidade Presbiteriana Mackenzie.