Big Four tech companies

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The Big Four[1], Gang of Four[2], GAFA[3], Big Five[4], GAFAM[5][6] or Big Tech[7] are names used to describe four or five US multinational online service or computer and software companies that dominated cyberspace during the 2010s: Google, Amazon, Facebook, Apple and occasionally Microsoft. The term Gang of Four was coined for this context by Eric Schmidt in 2008,[2] Phil Simon, and Scott Galloway as describing the companies "behind the consumer revolution on the Internet" and "avoid[ing] taxes, invad[ing] privacy, and destroy[ing] jobs".[8]

Definitions[edit]

Schmidt, Simon, and Galloway define the term "Big Four" to mean the main companies that drive major societal change via their dominance and role in online activities, rather than just being the largest computer-related companies. They consider other large tech companies such as IBM to be driving less change than the Big Four.[1][9]

Smyrnaios justified the grouping together of the GAFAM five as an oligopoly that appears to take control of the Internet by concentrating market power, financial power and using patent rights and copyright within a context of capitalism.[5]

Extensions[edit]

Smyrnaios argued in 2016 that the Asian giant corporations Samsung, Alibaba, Baidu and Tencent could or should be included in the definition.[5]

Causes[edit]

Smyrnaios argued in 2016 that four characteristics were key in the emergence of GAFAM: the theory of media and information technology convergence, financialization, economic deregulation and globalization.[5] He argued that the promotion of technology convergence by people such as Nicholas Negroponte made it appear credible and desirable for the Internet to evolve into an oligopoly. Autoregulation and the difficulty of politicians to understand software issues made governmental intervention against monopolies ineffective. Financial deregulation led to GAFAM's big profit margins (all four except for Amazon had about 20–25 percent profit margins in 2014 according to Smyrnaios). Globalization let GAFAM minimise its global taxation load and pay international workers much lower wages than would be required in the United States (US).[5]

Oligopoly maintenance[edit]

Smyrnaios argued in 2016 that GAFAM combines six vertical levels of power, data centres, internet connectivity, computer hardware including smartphones, operating systems, Internet navigators and other user-level software, and online services. He also discussed horizontal concentration of power, in which diverse services such as email, instant messaging, online searching, downloading and streaming are combined internally within any of the GAFAM members.[5]

Opposition to GAFAM[edit]

Smyrnaios recommended developing academic analysis of the political economy of the Internet in order to understand the methods of domination and to criticise these methods in order to encourage opposition to that domination.[5]

Legislative actions against GAFAM[edit]

On 9 May 2019, the Parliament of France passed a law intended to force GAFAM to pay for related rights (the reuse of substantial amounts of text, photos or videos), to the publishers and news agencies of the original materials. The law is aimed at implementing Article 15 of the Directive on Copyright in the Digital Single Market of the European Union.[6]

See also[edit]

References[edit]

  1. ^ a b Simon, Phil (22 October 2011). The Age of the Platform: How Amazon, Apple, Facebook, and Google Have Redefined Business (1 ed.). Motion Publishing. p. 312. ISBN 9780982930250.
  2. ^ a b Schonfeld, Erick (31 May 2011). "Eric Schmidt's Gang Of Four: Google, Apple, Amazon, And Facebook – TechCrunch". techcrunch.com. Archived from the original on 2019-05-25. Retrieved 2019-05-25.
  3. ^ "GAFA Approach to Digital Banking Transformation - Accenture". www.accenture.com.
  4. ^ Sen, Conor (15 November 2017). "The 'Big Five' Could Destroy the Tech Ecosystem". Bloomberg. Retrieved 2019-02-10.
  5. ^ a b c d e f g Smyrnaios, Nikos (2016). "L'effet GAFAM : stratégies et logiques de l'oligopole de l'internet" [The GAFAM effect: Strategies and logics of the internet oligopoly]. Communication et langages (in French). NecPlus. 188. doi:10.4074/S0336150016012047. ISSN 0003-5033. Archived from the original on 2019-07-13. Retrieved 2019-07-13.
  6. ^ a b Bougon, François (2019-05-21). "Face aux Gafam, les députés adoptent le droit voisin" [Members of Parliament pass a related rights law against GAFAM] (in French). Le Monde. Archived from the original on 2019-05-25. Retrieved 2019-05-26.
  7. ^ "The Economics of Big Tech". Financial Times. 2018-03-29. Retrieved 2019-06-06.
  8. ^ Pisani, Bob (3 October 2017). "We are letting Amazon and Apple 'avoid taxes, invade privacy, and destroy jobs,' says NYU professor". CNBC.
  9. ^ Galloway, Scott (2017). The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google. Random House. ISBN 9781473542105.