Competition scholar and cyberlawyer Tim Wu (previously) is best known for coining the term "Net Neutrality," but his work ranges over all sorts of issues related to technology, competition, monopoly and innovation; in his forthcoming book, The Curse of Bigness: Antitrust in the New Gilded Age, he makes the case for breaking up the tech giants, starting with Facebook -- because the problem with Big Tech isn't "tech," it's "big."
Wu sensibly lays the current antitrust crisis at the feet of Ronald Reagan, who followed the University of Chicago economists' doctrine and dismantled antitrust enforcement except in the narrow case of price-fixing to set a minimum price; this has allowed companies to get away with a host of anticompetitive evils, from predatory pricing to market-cornering to buying up all competition before it becomes a threat.
Wu sets out the case for breaking up the tech giants without any legal reforms -- just through a change in enforcement strategies, the kind of thing that President Elizabeth Warren could order on her first day of work in January 2020 regardless of the makeup of Congress or the Senate.
“The easiest way to do it is to start by breaking off WhatsApp and Instagram so those are separate companies,” says Wu. “Hopefully, those companies try to introduce more privacy-sensitive or otherwise better social networking options. Right now, because they’re all owned by the same place, they’re never really allowed to get at the mothership and be a true replacement for Facebook. I think WhatsApp is in an even better position [than Instagram], frankly, to try to go at it. They’ve got this great messaging service. Everyone loves it.”
But wouldn’t reaching in to break up Facebook be difficult for the government to justify? Wu thinks differently. “Unless you believe that we want one ruling master of all social networking and it should be Mark Zuckerberg… then there’s no good reason not to break it up,” he adds. “What’s the argument against it?”
“These are corporations,” says Wu. “They have subunits. Sometimes corporations divide by themselves. It’s not that dramatic, and there’s been this campaign to say, ‘Oh my god, this would be like the most insane thing ever.’”
The Curse of Bigness: Antitrust in the New Gilded Age [Tim Wu/Columbia Global Reports]
It’s time to break up Facebook [Nilay Patel/The Verge]