Apple, Amazon, Facebook, Google, and Microsoft have created their universe in which they are the sun and everyone else—billions of people, corporations, countries, and governments—are simply planets orbiting them. This may appear to be old news. For a long time, the Titanic 5 technology has been large and wealthy, and they have grown even larger as individuals and organizations have required their goods throughout the coronavirus epidemic.
America’s technological superstars have soared into a stratosphere well beyond that of even the most spectacularly successful tech firms. According to statistics from S&P Global Market Intelligence, the current stock market value of the Big Five ($9.3 trillion) is greater than the value of the next 27 most valuable US firms combined, including corporate heavyweights like Tesla, Walmart, and JPMorgan Chase. Apple’s earnings in the first three months of 2019 ($21.7 billion) were nearly double the total yearly profits of the five major US airlines in the year before the epidemic.
Jeff Bezos has become so wealthy as a result of Amazon’s stock price gains that he could buy a new model iPhone for 200 million people and still be a billionaire. Google’s $50 billion in ad income from April to June was about equal to what Americans—all Americans—spent on gasoline and gas station goods in the previous month. In the last year, one of Microsoft’s side firms, LinkedIn, generated roughly four times the income of Zoom Video Communications, a star of the epidemic. The Big 5 tech behemoths had outgrown Earth.
What is clearer than ever is that America’s digital titans have created their universe, in which they are the sun and everyone else—billions of people, other corporations, entire countries, and governments—are merely planets orbiting them. Even more astonishing than the firms’ size and scope is how they have typically grown more lucrative under what might or should have been profit-draining economic conditions. People have been perplexed by Amazon and Apple’s profit margins, which have been larger than those firms’ for years—possibly ever.
Even though the epidemic caused those firms to restructure factories or warehouses, cope with disrupted worldwide shipping, hunt for parts in limited supply, and spend a fortune to keep their people safe, this has occurred.
So, what does it all mean? For one thing, members of Congress or state attorneys general may look at the figures and wonder how profit margins could continue to rise at this rate if, as the Big Tech companies claim, they face intense competition and could perish at any time. If firms are competing against a large number of competitors, logic suggests that they will have to lower prices, reducing profit margins. So, how can Facebook transform each dollar of revenue, almost entirely from ad sales, into 43 cents of profit – a figure that most businesses can only dream of, and one that is greater than Facebook’s pre-pandemic earnings?