After repeated scandals at big tech companies such as Google and Facebook, ‘Techlash’ became the Financial Times’ Year in a Word 2018. It represents the loss of trust and growing hostility of the public towards large platform technology providers such as the Faangs (Facebook, Apple, Amazon, Netflix and Google) and the Chinese Bats (Baidu, Alibaba, Tencent). Issues revolved around privacy violations and election manipulation for instance and the consequence was a drop in share prices.
In 2019 the question was thus how these firms were going to react to regain their customers’ trust. Most companies were dreading more regulations, which would affect their business models and most likely entail a fall in stock prices similar to 2018. The Economist identified some of the most popular ideas that were being considered to control the companies’ influence, including breaking them up and preventing further acquisitions. Additionally, the threat of a trade war became apparent with altercations between the U.S. and China.
Big tech firms were facing a considerable challenge and there was no obvious solution to it. Nevertheless, in 2020 – the covid-19 year – Financial Times published an article claiming the techlash was over. They argued that despite the persistence of bad press and regulations around tech firms, they provide consumers with products they want. The incredible results of Apple, Amazon, Facebook and even Tesla, as well as the success of Disney’s streaming platform have confirmed this shift and lifted any worry of a saturated market. Similarly, Wired sees a turning point and specifically mentions Facebook – which was considered the poster child for techlash – as profiting from corona.
It is argued that while the public has not forgotten about their past mistakes, the focus has shifted onto the companies’ current actions. For instance, Facebook has become a comforter during social distancing, Google has greatly contributed in terms of Covid-19 testing and Amazon has become consumers’ personal supply chain. Among the pandemic, it is one of the only industries that did not falter, the firms have helped the economy stay afloat and kept people connected to one another. Rather than facing more regulation, the pressure for antitrust seems to fade compared to fighting the issues, there is even talk of relaxing certain policies.
The question remains however, with unprecedented billion-dollar fines for tech companies in recent years, has the techlash really been solved or is corona simply putting it on hold? Will tech companies take advantage of their current position to better themselves or will they have to face an even more substantial backlash in the future?
Comment down below what you believe will most likely happen and what attitude you have towards the FAANGs and their growing importance. If you are interested and want to dive deeper, here are some interesting sources about the topic.
Sources
https://www.ft.com/content/a49b002a-4997-11ea-aee2-9ddbdc86190d
https://www.ft.com/content/76578fba-fca1-11e8-ac00-57a2a826423e
https://www.brookings.edu/techstream/covid-and-the-future-of-techlash/
https://www.wired.com/story/plaintext-has-the-coronavirus-killed-the-techlash/
https://www.politico.eu/article/tech-policy-competition-privacy-facebook-europe-techlash/
