Amazon’s dynamic pricing strategy can make shopping tricky for the average consumer, but if you know where to look – and when to act fast – Prime members can save a ton of money.
We’ve gathered all the best discounts currently available on the retail giant. Below you’ll find one-day sales via Amazon’s Gold Box promotion, exclusive coupon codes, and, of course, dynamically-priced goods ranging from tech, fashion, gaming, and home goods.
Due to the unpredictable nature of online shopping, prices may change without warning.
Earlier this month, Amazon CEO Jeff Bezos announced that Andy Jassy would succeed him as CEO. I think the succession process was well received and it presents five lessons for business leaders.
1. Decide what strengths your successor will need to keep your company growing
The first step in picking a successor is to try to imagine what the most important skills your company will need at the top are in order to continue to grow after you leave. If you’ve founded a company and made it successful, your successor should embody its culture because your employees will lose motivation if the culture changes.
At the same time, you do not want your successor to slavishly replicate everything you think and do – which I call a Head in the Sand strategic mindset in my new book, “Goliath Strikes Back.”
Instead your ideal follower could be a Fast Follower – someone who can perceive an exciting growth opportunity, formulate a strategy to capture that growth, assign talented people to execute the strategy, and hold them accountable for results.
That is what Sam Walton did when he appointed David Glass as his successor. Glass launched Walmart’s 1987 move into groceries – which by 2019 was the largest grocery business in the country. As I wrote in my book, Glass, saw offering groceries as a way to save time for consumers by enabling them to one-stop-shop.
Glass exemplified how to succeed a charismatic founder – humbly lead a team that follows the founder’s principles. As Glass explained in 2004, “Most people have enough ego that they want to distinguish themselves from a charismatic leader, and that’s what creates the problem. I have never had much ego, and I am not worried about things like that. I am more interested in the satisfaction that we are doing the right things and … being part of a winning team.”
2. Begin grooming your successors at least five years before you want to leave
The ultimate aim of grooming your successor – particularly for leaders of public companies – is to plan the process so well that when it finally happens, your company’s employees, customers, and investors take it in stride.
Many years ago, Bezos put two top executives in positions of major responsibility. Jeff Wilke was CEO Worldwide Consumer and Andy Jassy – who has worked at Amazon since 1997 and created and built AWS into the leader in cloud services – was CEO of Amazon Web Services (AWS).
When Wilke announced last August that he would retire this year, I was shocked. In retrospect I should have seen it as a sure sign that Bezos was indeed planning to leave as Amazon CEO and that Wilke had lost out in the race to succeed him.
3. Set clear criteria for evaluating the rivals for the top job
If you have completed the first step – thinking about the skills your company will need in a future CEO – you should have little difficulty setting criteria for choosing the winner from among the candidates.
I do not know what criteria Bezos set for choosing his successor – but here’s my guess:
A track record of making outstanding decisions informed by relevant available data.
Acts according to the values that make Amazon successful.
The ability to manage people to achieve excellent performance.
A record of creating significant new sources of revenue and profit.
The ability to to manage difficult legal and regulatory matters.
You should set criteria along these lines when evaluating potential successors.
4. Keep delegating more responsibilities to ease the transition
Over the last several years, Bezos has been delegating more operational responsibilities to his top executives. According to the Wall Street Journal, Bezos had stepped away from running the day-to-day operations of Amazon – that is until the pandemic hit last spring.
Amazon’s board had become more forceful about succession planning after Bezos survived a 2003 helicopter crash in Texas. After appointing Wilke and Jassy as CEOs of the company’s retail and AWS operations in April 2016, Bezos devoted himself to new products such as the 2014 Amazon Fire Phone that flopped and the successful Echo speaker, noted the Journal.
5. Aim for a hiccup-free announcement of your successor
In an ideal world, you would announce your replacement as CEO on the same day that your company reported very strong financial results. It would be even better if investors boosted your stock that day and accepted the announcement of your successor with a shrug.
That is exactly what happened when Bezos announced that Jassy would take over as CEO later this year. Meanwhile, as Executive Chair, Bezos will not be going away completely – and he will be able to work on projects aimed at boosting Amazon’s growth.
“What surprises us is that we are the focus of a story like this when some of the country’s largest employers, including the largest retailer, have yet to join us in raising the minimum wage to $15,” Amazon said in a statement to Bloomberg at the time.
Retailers sniping at each other comes as no surprise
With a $15 minimum wage already rolling out in many states and cities, some companies are spending less time fighting new federal regulation and more time fighting each other.
“However, a lot of retailers have been voluntarily increasing wages over the past few years so an increase to $15 is now not seen as such a big deal by some,” Saunders continued. “Indeed, many have raised, or are in the process of delivering on promises to raise, wages to $15.”
Higher pay for entry-level positions, as well as better benefits and other perks, typically means companies can hire more engaged workers who are less likely to quit. Retailers raise workers’ pay because of regulation, but also to better compete with rivals.
“One of the challenges for any retailers is turnover,” Moody’s analyst Charlie O’Shea told Insider in October.
“Amazon has very liberal benefits programs, even for part time employees,” O’Shea added. “Walmart has got college covered. There’s all sorts of bells and whistles that the retailers at the top end of the food chain have been able to do because they can afford it.”
Some major companies actually pay all workers at least $15, while others offer a wider range. Here is how some of the biggest players measures up.
Walmart minimum wage: $11 per hour
On Thursday, Walmart announced that on March 13 it will roll out a raise that brings 425,000 associates’ pay to between $13 and $19 per hour. As a result, the average pay for nearly half of hourly workers in the US will reach $15 per hour, according to a Walmart representative.
“Those people that we’re raising wages for tend to have been with us for a longer period of time than someone that might be earning the entry wage,” CEO Doug McMillon said on a call with investors this week. “We’re trying to … create this ladder of opportunity, providing an opportunity for people when they start with the company to build a career like so many of us already have.”
“Everything we aspire to do and be as a company builds on the central role our team members play in our strategy, their dedication to our purpose and the connection they create with our guests and communities,” Target CEO Brian Cornell said in a statement.
Kroger minimum wage: Varies by region
While Kroger says its average hourly wage has been $15 since 2019, some workers make less than that. Entry-level pay varies by region and job position.
“Since the start of the pandemic, Kroger has proudly invested over $1.5 billion to safeguard and reward our associates and committed nearly $1 billion to secure pensions for tens of thousands of our associates across the country,” a representative said in a statement.
Kroger has also faced backlash recently for closing stores in Seattle and California due to “hero pay” regulation that would have temporarily increase workers’ wages by $4 per hour.
“The biggest issue for many right now is dealing with local ordinances mandating temporary hero pay boosts and bonuses,” Saunders said. “This is causing a lot of issues and a patchwork of different wage structures. Many of the rules are illogical and hard to implement.”
Amazon minimum wage: $15 per hour
Amazon raised its minimum wage to $15 an hour in 2018.
“At Amazon, we believe $15 an hour is the minimum that anyone in the U.S. should be paid for an hour of labor,” Amazon said in a statement to Insider on Friday. “That’s why, since 2018, every Amazon employee has earned a starting hourly wage of at least $15.”
“It’s also why we’re calling on Congress to raise the federal minimum wage to $15 an hour and urging other major corporations to increase wages to this level,” the statement continued. “We’re pleased that multiple companies have taken this important step – which will help workers and their families, communities and our overall economy – and hope more will follow suit.”
Looking for more gift ideas? Check out all Insider Reviews gift guides here.
From tech gadgets and laptops to fresh groceries and clothes it seems like you can find pretty much anything on Amazon. The sheer breadth of products is one of many benefits of shopping with the e-commerce giant. But it can also quickly become one of the frustrations. With so many options to choose from, you can end up in a seemingly endless shopping black hole scrolling through items.
In a sea of choices that nearly everyone has access to, you might not think of Amazon as a spot to find truly unique gifts. But we did the tough work of scouring Amazon to curate singular and cool gift ideas. Amazon handmade offers locally made and artisan products from small businesses around the country and Amazon has even curated gift lists and ideas catered to different hobbies, styles, and more. You can also shop Amazon’s curated portal to support Black-owned businesses. And with a little digging, there are plenty more unique and thoughtful options to be found.
Here are 35 cool and unique gifts ideas, all available on Amazon.
Whether it’s used to carry their groceries or random knickknacks, everyone needs a good reusable bag. We love the original Baggu. It can hold up to 50 pounds of stuff, but can also be folded down to fit in your pocket. It also comes in tons of fun colors and patterns.
You may be seeing trendy moon lamps popping up, but you can make your gift even more unique by opting for this Saturn lamp. The dimmable LED lamp has seven different settings and you can even set it to change colors to a bright hue. Easy to move from room to room, it lasts for up to eight hours after each charge.
If you ask us, there is truly nothing better than 365 days of dogs. The calendar comes from the same brains behind WeRateDogs’ popular Twitter account, and don’t worry, every dog receives a rating of at least 11/10.
For the wine lover in your life, this bag does double duty as a cute outfit accessory and an insulated bag to easily bring along a bottle of wine to that house party, backyard barbeque, or picnic at the park. It comes in numerous pattern and color options, including nautical stripes, black tweed, beaded patterns, and more.
A cactus is a fun way to add some color to your desk or countertop, but if you’re not ready to be a plant parent, go for this instead. It’s actually a diffuser — it’ll fill your room with a nice floral scent — but it looks like a cute potted plant.
While coasters are a pretty basic household accessory, there are plenty of ways to make them more fun — like this unique set that is made with geometric designs. While the tops are colorful, the sides are a clear acrylic which creates a prism-like effect when sunlight passes through.
French pharmacies are known for their readily-available, high-quality skincare products. Gifting your buddy a ticket to Paris may be out of the budget, but you can still snag them some of these cult-favorite products, like this seriously hydrating face cream.
A little fan to deal with their unpredictable office temperatures
Office dwellers know how unpredictable temperatures can get. To save them when their office (or home office) transitions from an icebox to a desert, gift them this little portable fan. It’s small, mobile, and plugs into any USB for a quick, cold breeze.
This delicious chow-chow relish is made with a family recipe dating all the way back to the 1930s. A gourmet blend of pickled vegetables and spices, it’s a classic that can be used to dress up everything from hot dogs to hummus.
Everyone deserves some relaxation, which is why this calming bath soak makes such a great gift. Inside there’s dehydrated coconut milk, vanilla, and Himalayan coconut CO2 extract, which together help soothe the skin and calm the mind.
One of our editors asserted that “candles are the most classic gift of all time.” We have to agree, and while there are many to choose from, we love the sentimentality and customization Homesick candles offers. They have candles made to smell like each of the 50 states, many cities, and even experiences like watching Friday night football or taking a road trip. No matter where they call home, one of these candles is sure to bring them a rush of nostalgia.
If they like their beverages ice-cold, they’ll appreciate this thoughtful bottle holder. It can hold 12 oz. cans, 16-ounce cans, or be used as a pint glass holding 16 fluid ounces, so it’s really a three-in-one gadget. When they need a break from beer, this is perfect for keeping their water bottles chilled too.
A creative journal that’ll help them get some sleep
A great night’s sleep is essential to our well-being, but getting those eight hours each night can be easier said than done. If you know any night owls who need to catch up on their sleep, this journal will make a great gift. It’s full of prompts, illustrations, and questions to put their minds at ease when they’re up in the wee hours of the night.
For the friend who likes to keep it really organized, help them stay on track with this thoughtful set of sticky notes. With categories like “To Ponder,” “To Remember,” and “To Buy,” they can keep track of everything they need to accomplish in the near future.
From pizza ovens to pizza apparel, there’s no shortage of gifts catered to pizza lovers out there. We’re partial to these socks for their packaging, which is made to look like an actual pizza in an actual pizza box.
Simple illustrated prints to hang around the house
Finding unique home decor that’s also affordable can be a tough feat, but these artistic prints check off all the boxes. The illustrations of plants make a great addition to their kitchen, or even their bedroom if they want to show off their green thumb.
Reusable lunch bags that they’ll actually want to use
Plastic bags are an unnecessary expense when you could just have reusable ones. Their environmentally-conscious and frugal sides will thank you for these sandwich and snack bags, which are dishwasher safe and BPA free. They’ll save a ton of money and plastic waste by using these, plus the colorful patterns are much more fun than clear plastic.
We’ve sung the praises of the Trtl Pillow before — it’s an essential for any traveler. The cozy and supportive neck pillow is a great gift for any frequent travelers or anyone who’s about to head out on a trip.
Entertainers and those with state pride will love this cutting board. You can find a board shaped like any of the 50 states or Puerto Rico, each laser engraved with important landmarks, cities, and sights. It’s a fun, personal gift that they’re sure to love.
Nowadays, most of our photos live on our smartphones and social media apps, but many of us still love getting to look through or hang up printed pictures. This portable printer lets them do that super easily and with no wires so they can print pictures in a snap.
This gift is a no-brainer for loyal Apple users. Instead of dealing with a tangle of chords from charging all of their products, they can streamline with this singular hub, which has a designated spot for their iPhone, Airpods, and Apple Watch.
Your giftee will be saying “aah” when they use this set of three calming bath salts during their next deep soak. All three blends are made with Dead Sea salt and enhanced with essential oils to hydrate skin, relieve stress, and relax the muscles.
This leather Field Notes cover is completely handmade in the United States. With card slots and a memo book included, it’s a great gift for someone who’s about to embark on a new adventure, or anyone who loves to travel.
New York Attorney General Letitia James filed a lawsuit against Amazon on Tuesday accusing the company of failing to protect its workers from the COVID-19 pandemic.
“Throughout the historic pandemic, Amazon has repeatedly and persistently failed to comply with its obligation to institute reasonable and adequate measures to protect its workers from the spread of the virus in its New York City facilities,” James said in a legal filing to the state supreme court.
James said in the filing that Amazon failed to properly clean, contact trace, and notify workers of positive cases and possible exposures in its facilities and that the company’s productivity quotas prevented workers from following cleaning and social distancing protocols.
James also alleged that “Amazon took swift retaliatory action to silence workers’ complaints” by firing Chris Smalls and Derrick Palmer.
“We care deeply about the health and safety of our employees, as demonstrated in our filing last week, and we don’t believe the Attorney General’s filing presents an accurate picture of Amazon’s industry-leading response to the pandemic,” Amazon spokesperson Kelly Nantel told Insider.
In its lawsuit, Amazon alleged that James’ office didn’t have the authority to investigate workplace safety issues and that its safety measures had gone beyond what was legally required. Amazon also claimed James’ demands – including that it reduce productivity quotas, give up profits connected to any unlawful activity, and reinstate Chris Smalls – were unreasonable.
Amazon has previously defended its various COVID-19 safety measures.
Microsoft stock will climb to $300 as the company continues to gain cloud market share Wedbush analysts said in a note to clients on Monday.
Wedbush analyst Daniel Ives lifted the firm’s price target for Microsoft to $300 from $285 after “recent field checks” in the industry have led him to believe Microsoft’s Azure cloud business is gaining market share from the competition.
Ives had already raised his price target for the tech giant to $285 from $275 after Microsoft outperformed in its latest earnings report, but recent updates have the analyst seeing even more upside ahead.
Microsoft beat analyst revenue and earnings estimates for the quarter that ended in December on Jan 26, turning in record quarterly revenue of over $43 billion, up 17% year-over-year, and EPS of $2.03.
Analysts were most excited by the incredible growth of Microsoft’s Azure cloud business. The segment grew revenues by 50% year-over-year versus just 28% year-over-year growth at the company’s major competitor Amazon Web Services.
Now, analysts at Wedbush believe “the tide is shifting in the cloud arms race” and Microsoft is pulling ahead of Amazon’s AWS and others due to its broad installed base of customers.
“We believe Azure’s cloud momentum is still in its early days of playing out within the company’s massive installed base and the Office 365 transition for both consumer/enterprise is providing growth tailwinds over the next few years,” Ives said.
Wedbush also believes cloud adoption is only going to accelerate in 2021 even after a record year in 2020 due to the pandemic and stay-at-home trends.
“Based on our conversations with CIOs, CISOs, and IT product managers globally over the last month we believe cloud-driven architecture IT growth in 2021 could surpass that of 2020 as more enterprises rip the band-aid off on digital transformations,” Ives said.
The analysts continued, “we believe this disproportionally benefits the cloud stalwart out of Redmond, as Nadella & Co. are so well positioned in its core enterprise backyard to further deploy its Azure/Office 365 as the cloud backbone and artery.”
Growing market share and prime conditions for Azure are probably music to the ears of executives at Microsoft. Especially after former CEO Steve Ballmer said he wished the company had got into cloud services sooner.
“Azure — I wish we probably started a year or so, two years earlier,” Ballmer said in a live stream on Clubhouse. “We started actually with platform as a service instead of infrastructure as a service. Probably we would do that a little bit differently. It cost us a little bit of time in the eventual battle, if you will, with AWS.”
Microsoft traded up slightly in premarket hours on Tuesday at $245.50 per share, implying a potential 22% price increase based on the Wedbush analysts’ predictions.
A team at the Fraunhofer Institute for Manufacturing Technology and Advanced Materials IFAM in Germany has now developed a hydrogen paste, POWERPASTE, that may be easier to use especially in smaller vehicles.
However, they were too expensive for the consumer market at over $9,000 per bike and $36,000 for a charging station.
POWERPASTE might be able to solve that problem, with the substance created from magnesium base and stored in the vehicle in the form of a cartridge.
All drivers need to do to refuel is swap out the old cartridge for a new one and fill a tank with water.
“POWERPASTE stores hydrogen in a chemical form at room temperature and atmospheric pressure to be then released on demand,” institute research associate Dr. Marcus Vogt said in a press release.
As the paste only begins to decompose at temperatures of around 480 degrees Fahrenheit, researchers said drivers didn’t need to worry about leaving their vehicles out in the hot sun.
Fuel for the future
“POWERPASTE… has a huge energy storage density,” said Vogt. “It is substantially higher than that of a 700 bar high-pressure tank. And compared to batteries, it has ten times the energy storage density.”
The researchers also pointed out that the range of the paste can be compared with gasoline and may even exceed it.
They suggested that this could make it a viable option for cars or in portable fuel cells on camping trips, and could significantly extend the possibilities of drone usage.
The hydrogen industry looks set to grow significantly in the coming years.
Jeff Bezos and Bill Gates have already backed the startup ZeroAvia, which is developing hydrogen-powered flights.
In 2016, Germany invested $265 million in hydrogen cars and with the rise of viable alternatives, other countries may now follow suit.
The institute is now building a pilot plant at the Fraunhofer Project Center for Energy Storage and Systems in the German city of Braunschweig.
Scheduled to open later this year, they estimate an annual production capacity of four tonnes of POWERPASTE.
Former Microsoft CEO Steve Ballmer said he wishes he had invested in cloud computing earlier in his tenure at the tech giant, CNBC reported. Ballmer made the remark Thursday on Clubhouse, an audio-chat app, during a discussion that also included Sriram Krishnan, a general partner at Andreessen Horowitz, and Steven Sinofsky, a former manager at Microsoft.
“I wish we probably started a year or so, two years earlier,” Ballmer said, according to CNBC’s report.
Microsoft released its first cloud products in 2008 before debuting Azure, its cloud-computing service, in 2010. By then, Amazon had been selling cloud services for four years.
Amazon Web Services, Amazon’s cloud-computing division, is the leader in the cloud-infrastructure market, earning a 32% share during the fourth quarter of 2020. Microsoft Azure was second, with a 20% share. No other company reached 10%.
Cloud services have become a larger percentage of Microsoft’s business in recent years. During the company’s 2020 fiscal year, which ran from July 2019 through June 2020, its “intelligent cloud” segment accounted for 34% of the company’s revenue, up from 31% in fiscal 2019 and 29% in fiscal 2018.
Satya Nadella, Microsoft’s current CEO, ran the division at Microsoft that included its cloud business before replacing Ballmer in 2014. Nadella has also said he wished Microsoft had launched its cloud products sooner.
“We knew by looking at what Amazon was doing that we needed to reinvent ourselves,” Nadella said in 2017.
During the Clubhouse discussion, Ballmer said Microsoft was also too slow in its attempt to launch a phone. The company bought Nokia’s devices business in 2014, seven years after Apple released its first iPhone. By 2017, Microsoft said its phone-related revenue was “immaterial.”
News that Amazon’s incoming CEO is Andy Jassy is raising advertisers’ hopes that he’ll help solve some of their longstanding gripes about the company, Lauren Johnson reported.
Advertisers have long wanted more data to see if their ads grow awareness and lead to sales, and they’re speculating that he’ll bring together disparate parts of the company and bring more measurement to ads.
They point to his leadership of another growth business, AWS, and its cloud products that could help improve the accuracy of ads.
People are changing viewing habits while avoiding ads more than ever. Advertisers are seeking fewer big, multi-year contracts, while getting their message out is becoming more complicated than ever. Many are abandoning agencies altogether, figuring they can do the work better internally.
Main seems like he has as good a shot as anyone at turning around an agency, having built Deloitte Digital into a big business. But with big contracts being a thing of the past, its comeback could be more a plodding one than a roaring one.
As one exec put it: “I fully think Andy has the will and ambition. The main thing we’re struggling with right now is the work; it’s project by project.”
The coronavirus pandemic has not only accelerated legacy media’s push into streaming but influenced the kind of entertainment Disney, WarnerMedia, Netflix, and others are leaning into, namely, big franchises, Travis Clark reports.
The most notable example is Disney Plus’ “Star Wars” series, “The Mandalorian.”
Netflix and Amazon are building up their franchise content, too. Netflix has new teams dedicated to event/spectacle and franchise TV shows and also has its sights on video-game IP.
Disney has plans for 10 “Star Wars” and 10 Marvel TV shows exclusive to Disney Plus, and WarnerMedia is planning DC movie spinoffs.
That’s good news for franchise fans, but those craving the next feature film may have to be patient.
When the global financial crisis slowly subsided in the spring of 2010, tech giants Google, Apple, Facebook and Amazon (GAFA) were collectively valued at just under 450 billion euros by market cap. These companies were drivers of innovation that pointed the way forward, enterprises at the center of a flourishing technological ecosystem with a creative and technology-driven vision.
Over the past decade, the transformation of society’s relationship to these companies is unprecedented. We use the products of the GAFA companies to manage almost our entire professional and private lives. And during the coronavirus crisis, the value of the tech giants have increased even more. The GAFA companies, taken together, currently have a market capitalization of 6 trillion euros, which is about five times as much as the entire German DAX index.
The dominance of the GAFA companies has become so great that individual governments have no choice but to submit themselves to them.
It seems that many German and European politicians have given in to the superior power of the GAFA companies. Complicated regulatory issues are not very attractive election campaign topics, after all. This powerlessness is also reflected in the practically nonexistent media debate.
It is my steadfast conviction that how we handle the US tech monopolies will dictate Europe’s future. Never before in the history of our continent have so few companies possessed so much power – never before were they able to exert such a profound influence on our lives.
And even if it seems almost unimaginable – the technological revolution is not yet over. Quite the opposite is true. We are still in the early phases. If we want, we can still make the rules that will shape our future. But the room for the maneuvering needed to do this is shrinking, and time is running out. If we want to know what to do next, then it is vital that we gain an in-depth understanding of the mechanisms by which the tech monopolies operate.
The tech monopolies survive on data, algorithms, and capital
In the 20th century, a company’s wealth came from its factories, machines, and its qualified employees. In Germany and the EU, our entire education and economic systems are designed based on this formula. The problem is that the digital world functions completely differently.
In the digital world customer behavior is evaluated in real time. This allows digital services to be continuously improved and aligned precisely to customer needs and desires. The more data is collected, the better the algorithms work and the more relevant the offers presented to customers become.
Over the past decade, the GAFA companies have built a huge competitive advantage because they control the operating systems, the search engines, the browsers, and the cloud infrastructure. They also own the shopping marketplaces, the communication platforms, the networked household appliances, and the app stores.
To return to our picture of the 20th century, the tech monopolies not only have factories and machines, they also increasingly own the entire infrastructure of the value-creation chain, including all the businesses and all of the communication channels to the customer. With every new customer, this value-creation chain becomes more efficient and more profitable. Competition in the GAFA infrastructure is only allowed for as long as the competitor compensates the monopolist or helps the monopolist towards even more expansive growth.
The capital that the GAFA companies suck out of the system using this mechanism is fed straight back into undermining the competition or accessing new areas of business. The vendors on Amazon’s marketplace are just as dependent on the goodwill of the platform as media companies are on Google or Facebook. This goodwill can only be acquired by consistently providing access to all content and data, thus continuing to feed the monopoly and making it more efficient.
The enormous profitability of these infrastructure services allows the GAFA companies to invest in new fields of business on a very long-term basis. To do this, the monopolists are willing to accept high losses for many years in order to weaken the competition and build up market shares. Due to the enormous market capitalization of the GAFA companies, it is necessary for them to continue to occupy large and lucrative markets to keep the expansive system going and to increase their stock market price.
Consumers are the human shields protecting the monopolies
The favorite argument put forward by the GAFA companies to divert attention away from their position of power is that the products are free for the consumers and that they greatly improve the lives of all of us.
That is a sneaky argument that might seem plausible at first glance. However, it is a deliberate trick. The products sold via the platforms must finance the high profits of the GAFA companies – which means that the users are paying indirectly.
What is even worse: they are forced to hand over their personal data. The tech giants have no reservations whatsoever when it comes to analyzing their customers down to the smallest detail. They know that we can no longer live without their products, and that is why antitrust fines or occasional political objections are a small price for them to pay on the way to increasing their market dominance.
Our dependency on the GAFA companies’ infrastructure makes things extremely difficult for our government authorities because they want to help the citizens, not cause them problems.
A life without iPhones, Google Maps, WhatsApp, or Amazon is hard to imagine and not exactly something we are striving for. The bundling together of the different services such as the integration of maps into Google’s search engine, or the linkup between the app stores and the smartphone operating systems makes it even more difficult to break up the monopolies.
Not that GAFA doesn’t deserve our respect for having understood this connection years ago and for placing it at the heart of their strategy to defend what they do and exculpate them from any wrongdoing. None of us can imagine a world without their dominance anymore. And therein lies the problem, as well as the political and regulatory challenge.
The large tech corporations spend billions on image campaigns and employ an army of lobbyists in Berlin, Brussels and Washington, DC. There is hardly a single association, NGO, or start-up hub in the political sphere that they do not support in some way or other. Politicians and entrepreneurs who point out alternatives are – with only few exceptions – reeled in again by the lobbyists and opinion-makers, attacked in the media or have their businesses damaged.
The lack of regulation of the tech monopolies is the greatest danger to liberal democracies
There are two possible exit scenarios for the end of the tech monopolies. If we continue without strict regulation of GAFA, the polarization within society will grow. The economic opportunities of smaller businesses will shrink more and more because of the growing profits of the monopolies, and the GAFA companies will be able to take over whole new fields of business.
An ever-growing concentration of economic power will lead in the medium term to an erosion of the market economy. This will soon cause social unrest, distribution struggles, and an increasing destabilization of our liberal democracy, which will be unable to gain control of the economic inequality.
There have been clear signs of this development for many years, but our debate so far remains focused on the symptoms instead of asking about the causes. This is regrettable, because the facts are there for anyone to see. You only have to look at where record turnovers are being made in the midst of a great European recession, where profits are increasing permanently, and market shares are being gained.
And in my opinion, this dark scenario can only end in a state run by autocratic populists. We only have to look at protectionist China to see where this might lead. The GAFA companies have nothing to say there anymore, and the Chinese have constructed their own tech ecosystem. The Chinese population pays a very high price for this in the form of an illiberal dictatorship in which politicians decide who is allowed to have economic success.
The second, optimistic exit scenario is a return to European sovereignty and our social market economy. Ludwig Erhard, who as Minister of Economic Affairs led Germany’s remarkable post-war economic recovery (the Wirtschaftswunder, or ‘economic miracle’), and later became Chancellor, already postulated that a market economy can only work if it works for everyone. What Erhard was referring to here was protection against interference in the state, but also protection against monopolists and cartels.
Ludwig’s legacy is being kept alive today by the likes of EU Commissioner Margrethe Vestager, who campaigns like almost no other politician in Europe for regulation of the GAFA companies. However, in contrast to the eagerness for reform in the early years of the Federal Republic, the EU is slower as well as unclear in its vision and in its willingness to shape the future. And that is precisely the weakness that the US corporations have been exploiting for many years.
Far-reaching regulation of the tech monopolies is urgently necessary and unavoidable
In my mind, there can be no doubt that splitting up the GAFA companies is unavoidable in the long term if we want the liberal democracies of the Western world to survive. This is not only in the hands of the EU, but is ultimately a decision of the US government. Which is why this topic must be given utmost priority in German and European foreign policy.
The US is rightly demanding that we take our security interests increasingly into our own hands. But the ability to act in a self-determined manner also requires a functioning market economy, which is why we must immediately prompt the US to modernize its antitrust legislation and, after sharp debate in the Senate, to also become active in the campaign to split up the GAFA companies.
In the meantime, Vestager and the EU recently embarked on the pragmatic path towards intelligent regulations by announcing the Digital Markets Act (DMA). The DMA defines what gatekeeper platforms are and submits them to much stricter competitive restraints. For example, giving their own products preferential treatment in the marketplaces, as currently practiced by Amazon and Google, is to be prohibited and carries a heavy fine.
In my eyes, this is still not enough to cope with the problem of GAFA market power. We must define, isolate, and regulate the critical infrastructure of the GAFA companies. This applies, in particular, to the evaluation of personal data, and to the allocation of their enormous profits. Whether Google’s search engine, Facebook’s WhatsApp, or the Amazon Cloud: data and profits from this critical infrastructure must not be used to expand into other markets.
Just as we would not allow an electricity generation company to make unlimited profits to enter into direct competition with Miele, Siemens, and Bosch, we must subject our digital infrastructure to the same regulatory checks and controls. The data and the algorithms of the monopolists must be available to all of us so that those participating in the market can engage in fair competition on the platforms to the benefit of the customers.
For a long time, I was skeptical about whether Europe can succeed in managing this enormous task. But, in the meantime, I see reason for optimism. When Facebook recently wanted to force WhatsApp users to share all their data so that their advertising could more easily reach users via Facebook and Instagram, the update resulted in a huge surge towards alternative messaging services like Signal and Telegram.
Both of these have been at the top of the app stores for weeks now and differ from WhatsApp in that they request much less data. A turning point has been heralded in, and people are ready for a future that is different from the one imagined by the GAFA companies. The political decision-makers in Brussels and Berlin should follow this lead. The social market economy is one of our greatest achievements and is the foundation of our democracy.
And we should fight for it, especially in the digital age, undaunted by the size and power of its opponents.