Winner Takes All
Apple, Amazon, Alphabet (Google), Microsoft, and Facebook, in that order, are the five most valuable public companies in the world by market capitalisation (as of July 2018). Microsoft has been on the list since the 1990s but the others are relative newcomers. These companies are a large part of everyday life in developed economies and increasingly everywhere else except China – a protected market with its own tech giants (discussed later). They wield enormous power, raising difficult questions about their governance, regulation and accountability. That power derives from their dominance of large, profitable markets.
In this article, I address two questions. First, why are technology markets “winner takes all”, characterised by extreme market concentration? Second, how likely is it that market forces will end these companies’ market dominance in the foreseeable future, given that their competitors are “only a click away”?
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