A similar rationale justified Uber’s breakneck expansion to become a global transportation solution instead of a regional taxi provider. WeWork also sought “critical mass,” where it would have such a large amount of space available that it could offer a price and a level of flexibility that traditional landlords couldn’t match.
This brings us back to the bankers. Tremendously powerful and profitable, with privileged access to the most important information flows that drive the economy, banks and the largest tech giants are looking increasingly, and eerily, similar.
One obvious difference, at least until very recently, is the public sentiment toward them. Bailed out in 2008 and many times before, bankers have been widely disliked for their combination of massive wealth and easy access to the levers of power — things that allow them to stay on top, regardless of their behavior.
Another difference: There are large firms in the heavily-regulated financial sector, but no monopolies anywhere close to the scale of the tech giants. Halfway through 2019, the world’s five largest companies by market capitalization were Microsoft, Amazon, Apple, Alphabet (Google’s parent company) and Facebook. Only one bank — JPMorgan Chase — scraped into the top 10, in last place.
Will the erstwhile Tech Heroes turn into bankers? The lines of convergence look clear, and it’s hard to imagine tech monopolists maintaining their position when the data they hoard, and hugely profit from, is so critical to the economy. Banks are highly regulated from multiple angles — on privacy of information, on lending practices, on credit scoring and decision criteria — while the internet is still a Wild West.
However the regulation of these monopolies is tackled — whether through breakups, consumer protections and rights, data portability, or other approaches — it’s time to start scrutinizing large tech companies as we do major banks. And to retire the Tech Hero costume.
Rurik Bradbury is the chief executive of Docpack.
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