An analysis of the Democrats’ argument to break up tech.

By Stephen Clements

Have you ever heard of Wrapp, Giftly, Giftivo, Giftdish, Gifthit, GiftSimple, GiftDrop, DropGifts, YouGift, Ziftit, Let's Gift It…?

Probably not, which isn’t surprising.

They are just a handful of startups that were trounced when Facebook reintroduced gifting on the platform in 2017. I imagine this happens a lot—a tech giant launches a new feature and a slew of energetic and dynamic startups go up in smoke.

Talk about a tenuous existence.

No doubt it makes investing in a technology company very risky, and starting one even riskier. Sure, this has been going on since the dawn of business—the big eats the small—it’s a dog eat dog world, and Facebook has the biggest teeth.

So it was with some interest that I tuned into Elizabeth Warren’s talk at SXSW, during which she ripped into big tech and threatened to disrupt the disruptors by breaking them into smaller parts.

No doubt the cynic in me thinks this is just populist posturing from the 2020 hopeful.

Senator Warren picked SXSW to take her stand against big tech, because—as we all know—it’s hotbed of entrepreneurialism. It’s a who’s who of tech, and for 1 week the halls, bars, and BBQ joints of Austin are walked by any startup founder or tech-investor looking to rub shoulders with the world’s technorati, to get inspired, network, and maybe (just maybe) get funding.

And so the message was wildly cheered by her audience as she built her case to break up the G-MAFIA (Google, Microsoft, Apple, Facebook, IBM, and Amazon).

Her logic is that by limiting the power of these tech giants, it will give smaller companies room to breathe, help them innovate more freely, and boost the economy.

Sounds lovely.

And it’s not just a ray of hope for the startup community, it could also be a gift for big brands that aren’t so technologically endowed.

For example, I have lost count of the many meetings I have had with clients from all kinds of verticals—banking, insurance, automotive, etc.—all fretting the question “what happens when Amazon starts selling insurance/banking/cars/…?

For me, this is the exciting part.

As the big tech elites control the future of AI, and they are busy shoring up their digital advantage, the oxygen of innovation is being squeezed out of startups and big businesses alike. It will be an effed up world when you get your insurance, banking, healthcare and gym membership, all from the same provider.

What Senator Warren is proposing might scare the big tech giants—obviously.

They haven’t felt much in the way of regulation for so long, and so now, as legislation starts to catch up with their mercurial rise, the pigeons are maybe coming home to roost.

It’s an agreeable message for an audience of technological progressives at SXSW, but on the flip side, Democrats rely on big tech as their piggy bank for political donations, so we’ll see if they are really willing to do anything should they win the 2020 election.

It’s a debate worth having, for sure, but the cynic in me doesn’t expect much will actually come from it.