A recent report from Bank of America has revealed an alarming reality: seven tech giants, namely Apple, Microsoft, Alphabet, Amazon, Nvidia, Tesla and Meta Platforms, together account for almost $11 trillion in market value. These companies contributed to approximately 75% of the S&P 500’s returns during the first half of 2023, raising concerns about their growing influence and dominance within the stock market.
Big Tech’s dizzying success has caught the attention of the Biden administration and the Federal Trade Commission (FTC), raising concerns that this group, often called the “magnificent seven,” could become monopolies. The fear is that they could stifle competition and prevent innovative new companies from growing and ultimately maintaining their strength.
A key figure at the forefront of addressing these growing challenges is Lina Khan, the 34-year-old chair of the FTC, widely recognized as one of the agency’s most progressive leaders in history. His tenure ushers in a new era in antitrust governance, aimed at challenging decades of lenient policies around mergers and acquisitions that have allowed tech giants to swallow up their competitors and emerge as companies with trillion-dollar market capitalization.
Despite Khan’s unwavering efforts, the expected impact on the tech giants remains to be seen. For example, Apple recently surpassed a remarkable $3 trillion valuation, a historic milestone that no other company can match. Additionally, the FTC’s attempt to block Microsoft’s $69 billion acquisition of video game publisher Activision Blizzard was unsuccessful. Likewise, a similar case involving Meta Platforms’ purchase of virtual reality startup Within Unlimited resulted in defeat by the FTC.
Khan recently faced more than three hours of criticism from Republican policymakers during a House Judiciary Committee hearing. Rep. Kevin Kiley questioned his record, saying, “He’s now zero for four in merger trials. Why is he losing so much?”
Undeterred by the growing challenges, Khan, along with President Joe Biden, released a set of draft updates to the country’s fusion guidelines. These proposed changes aim to revolutionize the way the US government reviews mergers and acquisitions, marking the first comprehensive update in more than a decade. The potential implications of these changes could significantly alter the way anti-competitive agreements are identified, blocked or modified.
Unsurprisingly, some members of the business community expressed discontent with the proposed revisions. However, Khan remains steadfast in his commitment to maintaining competition in the market. He emphasized that the FTC does not specify the size of companies, but rather focuses on preventing companies from becoming monopolies through illegal tactics. He clarified that “Congress, by approving the antitrust statutes, established a policy of preference, in many cases, for competition over monopoly.”
Amid his battles with tech giants, Khan is preparing to take on Amazon in a major antitrust lawsuit. The FTC has already brought three cases against the e-commerce giant and is preparing to take a new approach. The lawsuit is expected to target Amazon’s core marketplace business, alleging that the company leverages its power to reward merchants who use its logistics services and penalize those who don’t comply.
Stock market concerns aside, the rise of self-employment is significantly impacting the U.S. economy. One such example is Lazarus Limo, who alternates between being an Uber driver and a DoorDash food delivery driver. Sharing economy platforms like Uber, Lyft, Doordash, and Instacart have gained immense popularity in the last decade and offer flexible work opportunities.
While official government data on gig workers remains elusive since the last tracking in 2017, workplace experts say the gig economy is on the rise and leaving a considerable impact on the broader economy. The prevalence of mobile work may even be influencing national unemployment rates, as gig workers offer a viable alternative to traditional employment, acting as a buffer for those who have faced job losses or financial difficulties in recent years.
Elsewhere, the film industry is experiencing renewed hope for a resurgence. The success of summer blockbusters “Barbie” and “Oppenheimer” has breathed new life into the struggling film industry, as these films collectively grossed $511 million in box office sales during their opening weekend. “Barbie” was a particular standout, generating $337 million worldwide, setting a new record for the biggest opening weekend of 2023 and the biggest debut by a female director. (Warner Bros., the producers of “Barbie,” is owned by CNN’s parent company, Warner Bros. Discovery.)
The box office success has sparked global interest: AMC, the world’s largest movie theater chain, reported that 60,000 people bought tickets to see both films on the same day.
While these developments are promising, the film industry still faces challenges. Big-budget movies like DC’s “The Flash” and Disney’s “Indiana Jones and the Dial of Destiny” have underperformed during the summer season. Additionally, an ongoing strike by Hollywood actors and writers, protesting wages and working conditions, has temporarily halted production on most films.
As the Biden administration and the FTC continue their efforts to address market dominance and the gig economy reshaping the American workforce, the film industry remains hopeful for a sustained resurgence. The road ahead may be challenging, but only time will reveal the long-term impact of these radical changes on the country’s economic landscape.
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