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Tech Giants Rethink The Businesses That Made Them Big

May 06, 2019 7:39 PM ETAAPL, AMZN, META, GOOGL, MSFT, T, GOOG5 Comments
John M. Mason profile picture
John M. Mason


  • The latest concern of journalists seems to be the "dilemmas" many big tech firms are facing in this new era, dilemmas the journalists think are forcing these companies to "rethink."
  • These journalist, however, are just focusing upon company products and not upon the changing nature of the modern corporation built upon intellectual property and platforms and networks.
  • The investor must avoid focusing upon just the the products a company produces and concentrate more upon how the economics of wide-ranging platforms and networks builds value and wealth.

This headline in the Wall Street Journal points to the dilemma that the “big Techs” are apparently facing as they look out into the future.

Urgency is the word used by the press to define this dilemma:

“Google, Facebook Inc. (NASDAQ: FB) and other tech giants have long tinkered with ways to grow outside the core businesses they dominate. Now those efforts are becoming urgent.”

“Apple Inc., (NASDAQ: APPL) meanwhile, said last week its sales-and-profit slump extended into a second straight quarter—the first time that has happened in more than two years—thanks to falling sales of the iPhone….”

“Google parent Alphabet Inc. (NASDAQ: GOOGL) has been Big Tech’s most eclectic big-idea factory. But it has had little success turning those efforts into moneymaking businesses.”

And, “even at Amazon, (NASDAQ: AMZN) revenue growth in the latest quarter was its slowest rate in four years (also 17%).”


Well, concerns over privacy abuses and misinformation “threatens ad-driven strategies at Facebook and Google while the slowdown in sales of the smartphone are dogging others.

The question being kicked around in the press is whether or not these giants need to build a new business model.

To me the venture of the press into this issue is captured by the focus that has been given AT&T (NYSE: T) in recent weeks. I have tried to capture this situation in a series of posts on AT&T, the latest of these articles came out last week.

The point I am trying to make it that the people analyzing the situation at AT&T and at the big tech firms focus upon products and services. They are looking at the situation through the eyes of a previous era where the relationship between a “producer” and a “customer” was direct and singular.

The picture of the era of

This article was written by

John M. Mason profile picture
John M. Mason writes on current monetary and financial events. He is the founder and CEO of New Finance, LLC. Dr. Mason has been President and CEO of two publicly traded financial institutions and the executive vice president and CFO of a third. He has also served as a special assistant to the secretary of the Department of Housing and Urban Development in Washington, D. C. and as a senior economist within the Federal Reserve System. He formerly was on the faculty of the Finance Department, Wharton School, the University of Pennsylvania and was a professor at Penn State University and taught in both the Management Division and the Engineering Division. Dr. Mason has served on the boards of venture capital funds and other private equity funds. He has worked with young entrepreneurs, especially within the urban environment, starting or running companies primarily connected with Information Technology.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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