Will today’s tech giants reach a century? It’s about product quality | John Naughton

A question: what is the average life of an American company? Not an old company, mind you, but one big enough to figure in the Standard and Poor’s index of the 500 largest. The answer is surprising: the seven-year moving average is 19.9 years. As far back as 1965, 32 years had passed and the downward trend is expected to continue.

Remember we are talking about averages here. The trend does not mean that no company that currently exists will make it into its first century. Some will almost certainly do, as some have done in the past: AT&T, for example, is 137 years old; General Electric has 130; Ford is 119 years old; IBM is 111 years old; and General Motors is 106. But most companies wither or are devoured long before they qualify for a telegram from the president.

With that thought in mind, let’s examine the giant tech companies that now straddle the world and dismay our lawmakers. Apple is 46 years old; Amazon is 28 years old; Microsoft is 47 years old; Google is 24 years old; Meta (born Facebook) at only 18 years old.

Which of these, if any, is most likely to hit triple digits? The answer depends on two things: which ones are providing goods or services that the world really needs and which ones are most vulnerable to changes in public opinion and political attitudes towards their businesses and business models.

Seen through that lens, Microsoft and Amazon seem like safe bets. At least in the Western world, every large organization, public or private, runs on Microsoft software and operating systems. (In the NHS alone, there are likely more than a million PCs and laptops running Windows.) For its part, Amazon has already established itself as part of the logistics infrastructure of Western companies. And between them, Amazon and Microsoft’s cloud computing services host a growing number of critical services.

Apple has grown to be the most valuable company in the world by making beautiful kits, whipping them at high margins, building a closed hardware-software ecosystem, and leveraging it to build an increasingly profitable services business. It’s not a racing certainty to get to 100, but it’s worth the penny.

Which leaves us with Google and Facebook. They both have the same business model: use close surveillance of their users to facilitate targeted advertising. Of the two, Google seems more secure, because at the heart of its business is the domination of something every Internet user needs: a powerful search engine. In a way, the company has built a prosthetic memory for the planet and although other search engines are available, none have come close to challenging it for dominance. The world would miss Google if it didn’t exist.

Does the same go for Meta / Facebook, though? Its business model is basically the same as Google’s, facilitating targeted advertising using the kind of tight surveillance initially pioneered by the search engine giant. In addition to Facebook, Meta owns Instagram and WhatsApp, with a contingent of challenges, caused by toxic user-generated content, which it seems unable to manage effectively. In what has been transformed as a bold strategic move (but it looks terribly like an attempt to get out of the resulting stench), the head of the company is betting that the corporate ranch has built a “metaverse”.

If he thought that with that one leap he would be free, however, he was wrong. Instagram was originally a playground for the legions of young people fleeing Facebook, and for a time it worked well in that role. But then came TikTok, a Chinese-owned platform for people to upload short funky videos, which proved irresistible to those aforementioned youngsters and is driving Meta executives crazy.

Their first response was to create an imitative product called Reels to allow Instagram users to create TikTok-like videos. Oddly, it didn’t work. Or rather, it has it worked – but perversely. It turns out that a significant portion of Instagram Reels actually started out as a TikTok video! If imitation is, as they say, the most sincere form of flattery, the executives at TikTok are undoubtedly happy.

But, as an internal report of the company that has leaked to the Wall Street newspaper reveals, Meta bosses are anything but. It turns out that Instagram users spend 17.6 million hours a day watching Reels, which is less than a tenth of the 197.8 million hours TikTok users spend on that platform every day.

It is strange to see a huge company waving unnecessarily like an elephant tormented by a wasp, but that’s what’s happening in Meta. Additionally, the Metaverse project is burning money like it’s going out of style, which perhaps explains why the company is hiring 30% fewer engineers than originally planned this year. A survey of the Febrile activity newsletter found that the number of open jobs in augmented reality (AR) shows that Apple now has more jobs than Meta in that critical field.

Overwhelming all of this, however, is the realization that if liberal democracies are to survive, they will eventually realize that surveillance capitalism is such a danger to democracy that it will have to be outlawed. If that happens, then the chances of Meta (and possibly Google as well) being around in 2122 are, well, incredibly small. Sic transit glory and all this.

What I have read

Antisocial means
What the Truth Social Flop says about Trump is adorable Politic Jack Shafer’s column on Trump’s attempt to create his own Twitter.

Words have eyes
What does GPT-3 “know” about me? is an interesting article by Melissa Heikkil√§ about what she discovered when she started asking an AI questions about herself.

Lost connections
The Chaos Machine is a helpful review by Tamsin Shaw of Max Fisher’s new book on how social media has rewired our minds.

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