Category Archives: Big Tech

Alphabets Google trimmed an unspecified number of employees from its workforce, a move it stated is part of a wider restructuring intended to simplify operations and increase efficiency.

In a statement seen by Mobile World Live, a Google spokesperson explained the layoffs were intended to remove layers so it can maximise its resources to work on its most innovative and important advances, though the technology giant did not disclose the departments or numbers of jobs affected.

The restructuring was described by the company as a normal course of business to ensure its workforce allocates its energy to work on priorities, and impacted staff will be able to apply for other internal roles while receiving a severance package.

Reutersnoted the cuts are not company-wide and that a small percentage of impacted jobs will move to locations Google are currently investing in, including its operations in India and Ireland. The outlet added some employees across Googles finance and real estate arms have already been affected by these changes.

The news first came to light due to leaked internal memo seen by Business Insider, in which Google CFO Ruth Porat told staff the cuts were part of a restructuring strategy to better align its ecosystem with AI-related changes in the technology sector.

Porat reportedly noted in the memo the restructuring will involve an expansion to Mexico and the Indian city of Bangalore.

Google axed hundreds of staff in January in a drive to prioritise its spending on AI innovations, and at the time CEO Sundar Pichai warned of more staff cuts this year.

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Google restructure leads to job cuts - Mobile World Live

Jon Stewart was asked by Apple Inc. to not have Federal Trade Commission Chair Lina Khan on his podcast. Nonetheless, amid several ongoing investigations by the FTC, he brought her onto The Daily Show to discuss recent antitrust legal action against tech giants and to explore corporate accountability concerns on April 1.

Regarding Apple, Stewart asked Khan, What is that sensitivity? Why are they so afraid to even have these conversations out in the public sphere?

Khan replied, Going back all the way to the founding, there was a recognition that in the same way that you need the Constitution to create checks and balances in our political sphere, you also needed the antitrust and anti-monopoly laws to safeguard against concentration of economic power because you dont want an autocrat of trade in the same way that you dont want a monarch.

During the 20-minute interview, Khan discussed how companies get away with monopolistic activity, including how to identify it through company behavior. With Stewart bridging the concept to oligopolies, Khan addressed how companies becoming less competitive harms Americans.

While monopolistic activity can be spotted through assessing the boundary of the market or the market share, Khan said the most direct way is looking at how the company behaves.

She presented Amazon.com Inc. as an example, which the FTC filed a lawsuit against in September 2023, alleging it prevented sellers from offering their products at reduced prices on alternative platforms. This included steadily hiking the fees small businesses had to pay to sell through Amazon, eventually paying one out of every two dollars to the company creating a 50% monopoly tax, Khan said.

When holding these companies accountable, the FTC, which employs about 1,200 employees, is outnumbered 10 to 1 in terms of legal staff. Khan says it leaves them outgunned, but not outmatched.

So this isnt just about getting a fine, Stewart interjected. They [SEC] go after groups and then they cant really prove it in court, so then theyre like, How about this? You give us a cut of your profit and well all be done here.

Khan said the FTC deters illegal behavior by, for instance, naming individual executives in some of the lawsuits. However, despite not having criminal authority, the FTC succeeded with Baruch alumnus Martin Shkreli, who hiked up the price of Daraprim by 5,000%, by banning him from doing business in the pharmaceutical industry.

Stewart then shifted focus to tech companies, which have faced recent antitrust lawsuits for stifling competition, citing Apple as an example. In March, the DOJ and 17 states sued Apple, alleging it maintains an illegal monopoly through practices fostering customer dependence on its devices.

Regarding oligopolies, which refers to a market structure where few firms influence the market, Stewart asked if companies are colluding together to corner the market.

One trend that were especially concerned about is the way that algorithms may be facilitating price fixing, Khan said. If you have a whole bunch of competitors in a market, be it hotels, be it casinos, and they all decide theyre going to outsource their pricing decision to the same algorithm, they may be in effect fixing their prices even if theyre not getting in a back room and making secret deals.

Concluding the interview on AI consolidation, Stewart mentioned how companies like Apple, Googles parent company Alphabet Inc. or Microsoft Corp. acquire AI startups and restrict access, leading to an arms race to see who will establish a monopoly or if this will become a new oligopoly.

The first thing we need to do is be clear-eyed that theres no AI exemption from the laws on the books, Khan said.

When asked by Stewart on what will follow if something catastrophic happens through AI, Khan said theres no inevitable outcome.

We are the decision makers. Khan said. We need to use the policy tools and levers that we have to make sure that these technologies are proceeding on a trajectory that benefits Americans, and were not subjected to all of the risks and harms.

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FTC's Lina Khan talks big tech monopolies on The Daily Show - The Ticker

Facebook (now Meta) raised international eyebrows in 2016 when it sought to dismiss a lawsuit by a 14-year-old girl from Northern Ireland whose nude image was uploaded without her consent to a so-called “shame page.” It was a curious move by an organization that claims to take these issues seriously.  

Since then, advancements in technology have opened dangerous new doors for predators determined to weaponize social media by committing online acts of sexual violence. Yet Meta and other online platforms haven’t changed their posture; in fact, they’ve lobbied Congress to escape accountability for the behavior of bad actors on their networks.  

That 2016 case is ever-relevant today as social media companies enjoy blanket protection over the growing problem of AI “deepfakes” — images of real people transformed into lifelike pictures and videos depicting them saying and doing things that never happened.  

There was a time, not long ago, when an altered picture — “photoshopped” was the common term — could be spotted a mile away. AI’s evolution has made detecting a real image from a doctored one nearly impossible.  

Concern over AI deepfakes has largely focused on their use in perpetrating election interference in this year’s U.S. presidential race. But they raise a more depraved problem that should scare all of us: deepfake pornography, where software programs accessible by a simple online search can turn an innocent image of an unwitting individual into a sexualized scene or video that can be posted online without consent.  

Taylor Swift, along with thousands of other celebrities, was the target of one. Innocent children are being victimized by it, too. 

Not long ago a 14-year-old boy notified the National Center for Missing & Exploited Children that someone had threatened to post a deepfake pornographic image of him if he didn’t pay the perpetrator ransom.  

Another 14-year-old girl from New Jersey told the New York Times she was “summoned” to her school’s assistant principal’s office, where she was told some of her male classmates had used an AI program to turn a clothed picture of her into a naked image that was posted online.  

She recalled the shame she felt when boys started laughing at her in the hallway. Images of other girls at the school were altered and shared as well.  

One of the victims has filed a lawsuit against a male classmate allegedly involved. It’s unclear if anyone was disciplined, but it’s safe to say the boys at the school aren’t laughing anymore. 

Local, state and U.S. officials are behind the curve in addressing this problem. 

“All school districts are grappling with the challenges and impact of artificial intelligence,” read the uninspired statement of Superintendent Raymond González in response to the New Jersey incident. A recently introduced state bill spurred “dozens” of other deepfake victims to come forward.  

Social media companies can do something about it, but some simply choose not to. The New York Times’s Nicholas Kristof found that Google and Bing searches for deepfake pornographic content returned a high number of faked celebrity sex videos while Yahoo’s search engine returned none. Comparatively, a Google search on suicide returned no results on how to commit the act but rather offered listings where people can go to get help.  

“In other words,” Kristof posits, “Google is socially responsible when it wants to be, but it seems indifferent to women and girls being violated by pornographers.”   

Social media companies have proven they can’t police themselves, but Congress can. 

They can amend the Communications Decency Act to hold social media companies liable when deepfake pornographic images are published on their platforms. They can pass bills, such as the Preventing Deepfakes of Intimate Images Act and the Shield Act, which would make the circulation of deepfake pornography a crime. They can pass the Defiance Act, which would enhance deepfake pornography victims’ rights.  

But Congress has gutlessly failed to act on any of these measures.  

Social media platforms could be part of the solution. They could ally with victims and show leadership and compassion by enacting tougher measures to censor deepfake content. They could set an example by pushing for stricter laws and regulations to prevent faked sexual images from being searchable or uploaded on the networks they host.  

Instead, they seek absolution of the problem. They fight to protect themselves from liability while victims are shamed on their platforms for something they never intended, and never authorized, that will haunt them for the rest of their lives.  

Facebook lost its attempt in 2016 to have the case dismissed and wound up settling with the 14-year-old girl from Belfast. It should be a message to every other victim of revenge and deepfake pornography on these platforms: Sue them and hit them where it hurts.  

As long as Congress remains impudent in standing up to them and as long as social media companies fight tooth and nail to evade responsibility, victims should drown them in litigation.  

Maybe then, and only then, they’ll get the message that the burden is on them to solve this crisis. 

Lyndon?Haviland, DrPH, MPH, is a distinguished scholar at the CUNY School of Public Health and Health Policy.? 

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Deepfake victims must punish Big Tech because Congress wont - The Hill

The latest craze sweeping the United States legislation to protect kids data and overall online safety has its own snappy epithet. The Guardian reports on the so-called Kids Code bills popping up in multiple state legislatures, the latest of which recently passed in Maryland by unanimous vote. The full list of nine states reads like a fellowship of age-appropriate design: Maryland, plus Vermont, Minnesota, Hawaii, Illinois, New Mexico, South Carolina, New Mexico and Nevada.

But every fellowship has its Nazgl, and in this case the two sides warring for moral control of the internet involve some atypical partnerships. Social media companies are pushing back against the legal wave alongside porn distributors and civil rights advocates, who say age verification rules risk violating the constitutional rights of law-abiding adults. For the social media firms, however, it may be less a matter of ethics and more about not wanting to enforce age policies that would limit their massive user bases all of which have been established under relatively lax verification standards.

Making matters even more complicated is the assertion by critics that social media platforms should not have to verify users age with ID or biometric verification because they already know a users age, as proven by targeted advertising. The argument is summed up tidily by a representative from the Tech Oversight Project, quoted in the Guardian: Social media companies business models are based on knowing who their users are.

In a legal petition to the Supreme Court concerning what it alleges is an unconstitutional age-verification provision in Texass HB 1181, Vera Eidelman, staff attorney with the ACLU Speech, Privacy and Technology Project, argues that the legislative panic over kids accessing content adult content is an overreaction with historical precedent.

This isnt the first time that concerns about minors access have led legislators to pass unconstitutional laws, reads the statement from Eidelman. Weve gone through this time and again, with everything from drive-in movies to video games to websites, and courts have repeatedly struck down laws imposing requirements that burden adults access to non-obscene sexual content in the name of protecting children.

Tactics employed by social media firms have not done much to dial down the tone. Lobbyists have posed as concerned parents in court without disclosing their affiliations. State disclosure forms reveal that big tech companies spent more than $243,000 in lobbying fees in Maryland in 2023, with Google spending $93,076, Amazon $88,886 and Apple $133,449. NetChoice, the industry lobby group representing the firms, has its own set of proposed solutions that would eliminate the need for identity verification, most of which take the onus to protect kids off of them. The Tech Oversight Project has observed a clear and accelerating pattern of deception in anti-Kids Code lobbying.

It makes for what John Carr, Secretary of the UKs Childrens Charities Coalition on Internet Safety (CHIS) and a noted authority on young peoples use of the internet, calls an exceptionally uneven playing field.

Speaking on the fifth and final day of the 2024 Global Age Assurance Standards Summit, Carr says NetChoice frames its mission as to defend free enterprise and free speech on the internet. Carr disagrees. The only thing that NetChoice actually does is take to court every single federal, state or city piece of legislation that tries to introduce any kind of regulation on anything connected with the Internet. And the reason for that is very straightforward they dont mind if they lose. But if they delay the process by five years, four years, six years, and the status quo is maintained, thats money in the bank.

While third-party vendors are the simplest and most accessible solution for age verification, they come with privacy risks a problem that Frances National Commission on Informatics and Liberty (CNIL) aims to solve with its more private system.

In an interview with Scientific American, Olivier Blazy, a computer scientist and professor at the cole Polytechnique in France who worked on CNILs age verification scheme, says the regulators system creates something like a firewall between the content provider and the verification service. The only information the content provider gets is a yes or no about whether a user is aged 18 or older, Blazy says. The only information the age verifier gets is that someone has sent an age-verification request.

ACLU | age verification | biometrics | children | CNIL | legislation | regulation | social media

Apr 18, 2024, 3:16 pm EDT

Compliance with biometric presentation attack detection standards has become table stakes for numerous applications of face biometrics in particular, and

Apr 18, 2024, 2:56 pm EDT

Representatives of the W3C Advisory Committee are looking for participants in a Federated Identity Working Group after a draft charter

Apr 18, 2024, 2:52 pm EDT

Digital birth certificates are going live in New South Wales, and kids will be the first to use them. The

Apr 18, 2024, 2:26 pm EDT

A method of using public key infrastructure (PKI) to enable interoperability among age assurance providers and systems was shared at

Apr 18, 2024, 12:59 pm EDT

Catholic bishops under the banner of the National Episcopal Conference of Cameroon (NECC) have launched a fervent appeal to all

Apr 18, 2024, 12:38 pm EDT

The distress of Nigerians over repeated episodes of biometric capture for different identification purposes has been highlighted by local outlet

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Kids Code bills prompt epic showdown between regulators, activists and big tech firms - Biometric Update

Big tech firms have been solid business for office landlords across the country, but the end of a growth spurt in the sector means thats no longer the case.

Many of the top technology companies are downsizing or reevaluating their office needs across the country, the Wall Street Journal reported. Those firms reluctance to keep vast amounts of space is another hit to commercial owners.

Amazon, one of the largest office tenants in the entire country, is looking to reduce its office vacancies by passing on lease renewals, terminating some deals early and dropping underutilized floors.

Alphabets Google and Meta are also reconsidering their office needs. The former has listed office space in tech mecca Silicon Valley for sublease, while Mark Zuckerbergs company is leasing less space than it did at the onset of the pandemic, an acknowledgement that remote work is here to stay, as well as a cost-cutting measure being deployed by tech firms everywhere.

Meanwhile, in 30 cities with a high volume of technology tenants, office space up for sublease is at its highest levels in a decade, according to CBRE. The volume of new office space leased by tech companies in the fourth quarter was roughly half of the space leased in the same quarter in 2019.

The loss of tech tenants isnt only damaging to office landlords. It can also spell a dip in business for retail landlords in central business districts who rely on steady foot traffic to draw in business.

The vacancy rate of offices across the country rose to 19.8 percent in the first quarter, according to preliminary data from Moodys Analytics, representing a record for its tracker.

Holden Walter-Warner

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Tech Firms Retreating From Office Market - The Real Deal

Reset Australia says Meta does not label all untrue content. Photo: Shutterstock

Digital advocacy group Reset Australia has sounded a clear alarm over voluntary big tech regulation and called on the federal government to step in after its complaint about Facebooks handling of misinformation was thrown out.

Reset Australia this week went public with its five-month long battle with Facebook parent company Meta and big tech representative mob Digital Industry Group Inc (DIGI) over the Australian Code of Practice on Disinformation and Misinformation.

Reset Australia has accused DIGI of a conflict of interest between its role in overseeing this code and in receiving funding from many of the companies subject to it.

It has urged the federal government to ditch its practice of using voluntary codes to oversee the tech sector and instead turn to big stick regulation.

In response, DIGI emphasised that the subcommittee handling complaints under the code is independent, that the industry group does not have a vote on it, and that voluntary industry codes designed by industry groups are common practice across a number of sectors.

The issue came to a head as a result of a statement made by Meta in its annual transparency report under the code, with the company saying that it has been applying a warning label to content found to be false by third-party fact-checking organisations.

Reset argued that this statement is untrue as Meta does not actually label all content that contains fact-checked falsehoods.

Metas policy involves the use of AI to find identical or near-identical versions of a post that has been found to be untrue by the independent fact-checkers.

Reset said that despite Meta claiming it is labelling all pieces of misinformation, many posts are slipping through the gap if they are merely worded slightly differently or even posted in a different colour.

Reset Australia produced 152 posts found to be repeating fact-checked falsehoods and reported these to Meta, but just 8 per cent of these posts were labelled.

In response to the letter, Meta agreed to provide further clarification on this process in this years annual report, but refused to make a public correction.

This led Reset to trigger the complaints process under the misinformation code, with an independent subcommittee meeting in March to discuss it.

This week the committee opted to reject Reset Australias complaint, finding that Meta had made a fair and reasonable offer to update its next report with additional information, but that this was rejected.

Reset said this is a mischaracterisation of what occurred.

We requested Meta provide further information so stakeholders could meaningfully verify the claims they made in their last transparency report, Reset Australia said in a statement.

We thanked Meta for their suggestion to add clarifying language in their next transparency report, but urged them to make a public correction. Meta refused to do that, and DIGI has endorsed their position.

Voluntary regulations

The decision reflects the weakness of the voluntary misinformation code, Reset Australia executive director Alice Dawkins said.

The decision today indicates that platforms can say what they like in their transparency reports and their source of independent audit does not have the capacity to run significant data testing of platforms claims, Dawkins said.

Reset Australia is now pushing for the federal government to step in and implement binding regulations and laws to oversee these big tech firms.

The Minister for Communications has said doing nothing is not an option, on misinformation. Well, were sounding a clear alarm that its time for government to do something, Dawkins said.

Big tech have carte blanche in Australia to make whatever decisions they like on our information environment, shroud those systems and processes in PR waffle and block critical scrutiny.

DIGI responds

DIGI managing director Sunita Bose in response said that it is common practice across a number of industries for these codes to be developed by industry associations.

As DIGI is an industry association for the technology sector, we have put strict firewalls in place to avoid conflicts of interest in our administration of the Australian Code of Practice on Disinformation and Misinformation, Bose said.

Bose said that the members of the complaints subcommittee are compensated by DIGI but are contractually independent, and that DIGI is the secretary of the subcommittee but cannot vote on its decisions.

In its decision, the independent subcommittee said that Reset Australia had produced no convincing evidence that Metas transparency report contained false statements, and that Meta has made information on its labelling and fact-checking processes available publicly.

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Time for government to regulate big tech - ACS

Artificial Intelligence & Machine Learning , Next-Generation Technologies & Secure Development

The British antitrust authority warned Thursday that the market for foundational models in generative artificial intelligence is taking on "winner takes all" dynamics that could entrench a small number of providers.

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U.K. Competition and Markets Authority head Sarah Cardell in a speech said the regulator won't repeat the hands-off approach that characterized its approach to digital markets over the past decade.

"Could we have responded faster to the competitive threats posed by large digital platforms, recognizing earlier that the tools we had would need adapting to address the unique challenges posed by this new breed of businesses? With the benefit of hindsight, I think the answer is almost certainly 'yes,'" she told a Washington, D.C. audience.

The same patterns of "incumbent firms leveraging their core market power to obstruct new entrants" is again present in the nascent generative AI market, Cardell said.

She pointed to a paper published that day by the CMA concluding that Google, Amazon, Microsoft, Meta and Apple - collectively dubbed the GAMMA firms - are presences up and down the foundational model value chain, raising the specter of greater levels of vertical integration.

Four firms with an outsize presence in offering compute or data resources - Amazon, Google, Meta and Microsoft - could restrict access to critical inputs. Incumbents for consumer or business facing markets could distort choices and restrict competition in foundational model deployment, the report states.

In addition to vertical integration, the regulator sounded a warning over a proliferation of partnerships and strategic investments, identifying an "interconnected web" of more than 90 firms involving GAMMA firms plus chip designer Nvidia

While partnerships could assist independent developers and increase competition, "we are also vigilant against the possibility that incumbent firms may try to use partnerships and investments to quash competitive threats, even where it is uncertain whether those threats will materialize," the report reads.

A Microsoft spokesperson said the company welcomes the "clarity and transparency provided by the report," and that the company is looking forward to engaging constructively with the UK CMA.

The report comes after some British lawmakers warned the competition regulator of potential risk arising from a small number of the largest tech companies influencing the policy developments in the country to use their products to power smaller models for market monopoly (see: UK Market Regulator Reviews Microsoft's Interest in OpenAI ).

Microsoft's close relationship with OpenAI faces similar scrutiny in the European Union. The European competition regulator is additionally investigating $16.3 million, multiyear partnership with Paris-based Mistral AI (see: EU to Analyze Partnership Between Microsoft and Mistral AI).

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UK Markets Authority Warns of AI Market Capture by Big Tech - BankInfoSecurity.com

Mapping the Biggest Tech Talent Hubs in the U.S. and Canada

While cities like San Francisco and New York remain centers of tech talent and innovation, many other cities are growing extremely quickly in terms of the tech labor pool.

This infographic draws from a report by CBRE to determine which tech talent markets in the U.S. and Canada are the largest. The data looks at the total workforce in the sector, as well as the change in tech worker population over time in various cities.

Tech talent represents a group of highly skilled workers in more than 20 technology-oriented occupations driving innovation across all industry sectors, ranging from software developers to systems and data managers.

Although these positions are concentrated within the high-tech industry, they are spread across all industry sectors.

Top tech talent markets are typically characterized by a substantial level of educational attainment and a significant concentration of young individuals. Forty-five of the top 50 talent markets have an educational attainment level above national averages.

The tech sector remains one of the top employers of highly skilled workers in North America, with over seven million workers.

Californias Bay Area, which includes Silicon Valley, remains the biggest tech hub, with a talent pool of 407,810 tech workers, compared to 378,870 in 2021.

The Bay Area also has the highest annual wage for U.S. tech talent at $185,425, followed by Seattle ($172,009) and Boston ($121,794)

Toronto remains the third tech hub in North America, just behind the San Francisco Bay Area and New York.

Canada has attracted significant numbers of tech workers largely as a result of the countrys immigration-friendly national policy and labor cost advantage, according to a recent report from the Technology Councils of North America (TECNA) and Canadas Tech Network (CTN).

In fact, Canadian cities like Vancouver, Calgary, and Waterloo have had the highest growth of tech workers over the past five years.

Between April 2022 and March 2023, 32,115 new workers came to Canada with the most migrating from India and Nigeria.

Despite the dominance of traditional tech hubs, the report also points to other cities that could receive tech talent over the next few years.

They are concentrated in the U.S. Midwest and South, like Boise (ID), Las Vegas (NE), Palm Bay (FL), and Birmingham (AL).

The report also highlights Winnipeg and Halifax as potential Canadian tech hubs.

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Mapping the Biggest Tech Talent Hubs in the U.S. and Canada - Visual Capitalist

Tech industry giants poured billions of dollars into artificial intelligence startups this year, far outpacing the amount of investment from venture capitalists, the more traditional source of funding for fledging businesses.

Microsoft, Google and Amazon collectively invested two-thirds of the $27 billion raised by generative artificial intelligence startups in 2023, according to data from Pitchbook, which tracks startup investments.

The investment surge from those established companies reflects the unusual moment in Silicon Valley. AI startups are a rare hot spot in an otherwise ice-cold market, and the cost to develop that technology is incredibly steep. Venture capitalists, meanwhile, aren't playing as prominent a role in the boom as they have in opening eras of other technology waves, like the mobile web and cloud computing. So firms like Microsoft and Amazon have stepped into the role vacated by the VCs, eager to secure lucrative stakes in the startups and intertwine their own AI development with the startups that they invest in.

Notable deals from the last year include Microsofts $10 billion investment in OpenAI and the over $7 billion raised by its chief rival, Anthropic, from Amazon and Google, among others.

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Big Tech Dumped $17 Billion Into AI Companies in 2023 Despite Frozen Market - The Messenger

Microsoft hiring and un-hiring OpenAIs Sam Altman last month was a bright red warning sign to entrepreneurs who hope one day to compete with Big Tech. As a venture capitalist looking to back future disruptors, this fills me with dread.

The eminent business theorist Clayton Christensen first defined disruptive innovation in 1997. He said startup founders with great ideas could beat dominant players not by directly challenging them, but by targeting bits of the market theyd overlooked, or by introducing simpler and more affordable solutions before growing themselves and eventually elbowing out the incumbents to take a bigger slice of the pie.

This theory was the bedrock of the startup revolution we have enjoyed since referenced in a million entrepreneur pitch decks to venture capital investors, whose risk-taking and risk capital working together drive the startup industry.

Christensens idea was also good for capitalism, and self-evidently supported the idea of free markets: innovation paid off for the brains behind inventions; consumers got better products or cheaper prices or both; and monopolies were less likely to form, thus the state could stay out of the way.

But over the last twenty years Big Tech Alphabet, Meta, Microsoft, Apple, and Amazon hasnt just turned this academic theory on its head, theyve all but killed it. We now live in a firmly post-Christensen world, with no better evidence than this the events at OpenAI.

Previous technology cycles gave rise to new players: desktop computers gave us Microsoft; the internet gave us Google; and smartphones gave us Apple, which rose like a phoenix from its own smouldering ash. These and most other companies in this epoch grew with VC-backing, or with a supportive independent public shareholder base, creating value for millions of citizens along the way.

It didnt take long for incumbents to learn what to look out for and how to avoid disruption.

Today, when a startup breaches the net, Big Tech buys it or tries to destroy it: Meta hoovered up Instagram and WhatsApp when it spotted opposition. Twitter cut off access to its platform to crush Meerkat, a video startup that competed with its own nascent Twitter Live service. Just last month Spotifys CEO Daniel Ek said he would not have been able to launch today because of Apples dominance.

If that sounds bad, things look much worse when viewed through the lens of tech's latest paradigm shift, Artificial Intelligence and the race to a generalised artificial intelligence (AGI). In fact, it is becoming the very opposite of a free market.

Thats because, in a world of AI, the entrance ticket to the big league is through unlimited cash reserves and supercomputer power. By default, the number of people who can play the game is severely limited.

Even the worlds top venture investors, with tens of billions under management, cant compete to keep these companies independent and create new winners that seek to challenge and replace incumbent Big Tech.

Its no wonder: with vast reservoirs of data, colossal R&D budgets, huge networks of spin-off products on which to cross-sell, and unlimited remuneration for employees that ensures escalators of talent are ready to join when Big Tech rolls out the red carpet.

When OpenAI needed investment and computing power to develop its epoch-defining technology, where could it turn? Few places but Microsoft could find $10 billion and enough computing infrastructure to power a small country. In return, Microsoft put a perpetual sole license in place on OpenAIs technology to keep future profits for itself and monopolize innovation for its own ends.

OpenAIs peers have similarly been unable to go it alone: Google, Amazon, and Microsoft have invested billions of dollars in Anthropic, Inflection AI, and more.

Altman, when cast adrift by OpenAI, could have gone it alone. Rumors abound that hundreds of millions of dollars were offered to him to start over. He certainly could have brought the talent. But it seems Microsoft was the only one in the negotiating room. VCs couldnt compete with hundreds of billions for the next technology transition. To highlight the sea change: this might be one of the few moments when Softbanks $100 billion Vision Fund could have solved a real problem.

AI is not the first platform shift stymied by Big Tech either. In self-driving cars, Google and Tesla own the show, and the only independent player Cruise couldnt afford to go it alone becoming a subsidiary of General Motors before eventually losing its founder and CEO too. In virtual reality, Meta and Apple have been the only ones spending tens of billions on what they believe is the replacement for smartphones.

In a world of AI, where Christensens theory of disruptive innovation is practically dead, where does that leave startups and the venture capitalists that invest in them? If monopolies can cherry-pick the highest return ideas, where does this leave the investment in innovation thats needed to tackle huge societal challenges, such as climate change, healthcare, and education?

Does the venture world risk the same fate as public markets: increasingly irrelevant for new capital formation and so decreasingly the place where industries of the future take shape? If so, then a dynamic, sometimes chaotic, but fundamentally diverse ecosystem risks being replaced by a monolith of corporate power.

Government intervention through regulation can only ever be one part of the solution. It should be a last resort to fix market failure or protect against known harms. If it must be done, which I think it must be, it should be fair, balanced, and proportionate.

The European Union has passed laws to tackle Big Techs anti-competitive behaviour and look at protections around AI. The UK is following suit. Cases against Alphabet are with the FTC in the United States right now.

The second part of the solution is more risk capital for startups, just as the tide has turned in the opposite direction.

Now more than ever, pension funds, endowments, sovereign wealth funds, and banks need to back more venture capital investments. Instead, the opposite is happening: these institutions are pulling back from VC. This is not because they think innovation is over, but simply because interest rates are higher, and their math says holding cash or bonds will be a better bet for the world.

In a world increasingly dominated by tech giants, the role of venture capital becomes not just relevant, but absolutely critical. These institutions should double down on the venture asset class, recognising its potential not only for strong, long-term returns, but also for its role in fostering and helping human creativity, innovations to improve society, and a thriving and dynamic market that benefits us all.

Patrick Murphy is a founding partner atTapestry VC, an early-stage venture capital firm that focuses on backing technical and repeat founders.

Lead image: Racool_studio

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Why OpenAI signals the start of the post-Christensen startup world - Tech.eu