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In the first few months of the pandemic in the United States, businesses closed or fell into chaos. Millions of people closed their wallets when they were locked wrote in On Tech At the time, it wasn’t obvious that America’s largest tech companies would continue to thrive as they did in the last decade or so.
The big tech bosses also sounded restless. After all, America’s five tech titans weren’t that hot during the Great Recession nearly 15 years ago. Maybe this time they would suffer too.
Hahahahaha. Yes … they were fine. Really very, very good.
In the past year, the five tech superpowers – Amazon, Apple, Google, Microsoft, and Facebook – combined sales of more than $ 1.2 trillionas I wrote for The Times on Thursday. It’s been a strange and amazing year for Big Tech. I can’t believe it, but some companies are growing faster and are more profitable than in recent years.
The pandemic has made the tech giants and their bosses unfathomably rich. (Even more inscrutable than before.) Apple has so much extra money that it is spending extra money $ 90 billion to buy its own shares, almost the equivalent of Kenya’s gross domestic product. From the 10 richest people in the worldEight made their fortunes with tech companies. The man at the top, Amazon’s Jeff Bezos, is worth more than a Goldman Sachs and a half alone.
I’ve seen a lot of financial metrics for bananas, including from these five tech giants. But I promise you, Big Tech’s numbers are so wild now that I run out of swear words to explain them.
How did it happen? I will give you two explanations. First, the pandemic has one special economy Some people and industries benefited from this, including in terms of technology, even if others were affected. In the last year of the crisis, people and companies had an even greater demand for what the tech giants were selling.
That might seem obvious now, but it wasn’t necessarily a year ago. Americans’ love of home shopping has become a safety necessity for some people. Families bought iPads and Macs when work and school became virtual. Any company that could still spend money on marketing spent it on google, facebook or amazon. Companies may have cut back in other areas, but they’ve definitely bought software from Microsoft and Amazon.
Second, the tech giants used the pandemic as a moment to get stronger. In some cases, this has meant cutting costs where it matters less, such as travel, entertainment, and marketing. Google said it saved more than $ 1 billion a year on these types of expenses.
On the other hand, the tech giants have spent a lot of money in areas that are expanding their advantage. Amazon spent $ 50 billion last year in big ticket purchases such as warehouses and cloud computing hubs. That’s more than double what Exxon Mobil spends each year digging oil and gas. Bananas again.
Like the economies in the United States and some other parts of the world will come alive again in 2021, the tech giants are lean, mean and ready to make even more money. The questions I have now: Are America’s technical forces invincible? And do they win at everyone else’s expense?
The first is impossible to answer, but it sure feels that way. And I asked this second question Thomas Philippon, Professor of Finance at New York University who studies the growing power of dominant companies.
Philippon told me the pandemic and the digital adjustments it made had helped smaller businesses. For example, restaurants had to adapt quickly Selling web orders and getting deliveries done, and many of these investments will help you out in the long run, too.
But he also believes the pandemic has likely widened the gap between big and rich companies, including tech giants, and everyone else. “In any case, there is a feeling that this is a recession that happens to be good for companies that are already doing well,” he said.
Before we go …
Big Tech’s success, however, is cumbersome: The European Union accused Apple of breaking the law My colleague Adam Satariano wrote using control of his iPhone app store to stifle competition. This is one of roughly four billion antitrust lawsuits or investigations that the tech superpowers are involved in.
Is that the office or “The Office”? Google, the company that set trends in office work and employee perks, is now trying to redefine the workplace after the pandemic. Dai Wakabayashi and Cayce Clifford outline Google’s plans, including Robots inflating temporary cellophane balloon walls and camp-themed outdoor work areas.
Read this to feel completely uncool: Invented out of the blue by people on TikTok, the term “cheugy “is a new and not entirely definable abbreviation for things that are a bit generic, straining too hard, or are out of date. The once dominant aesthetic of Instagram is Cheugy to the utmost. Apparently lasagna is naughty too? Just read Taylor Lorenz’s explanation of all of this.
Prancer has found a home! The Chihuahua, described by a pet adoption volunteer as a “rage machine” and “vessel for a traumatized Victorian child,” now live in Connecticut with a woman, Ariel Davis.
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