00:00Romain sent me this article literally in the commercial break coming out of the Financial Times today.
00:04The headline, the U.S. is losing its battle to break up big tech.
00:08I wonder if you agree.
00:10Well, I think the battle's not done yet, but they've certainly had some setbacks.
00:14I mean, part of the big idea in our administration is we needed to push big tech back a little bit.
00:19Maybe they were taking too much, as you were just saying, you know, being too much of the economy, too big a bet.
00:24So I think that the suits are not entirely done, but I do still think it's important to keep, you know, some watch on the big tech so they don't extract too much from the economy.
00:33Well, the pushback to that from certain folks that I've heard voices, why would you want to break up U.S. big tech?
00:40I mean, you think about the U.S. economy, U.S. markets, and big tech is the crown jewel and really differentiates the U.S. in that regard.
00:48And there's the argument out there that maybe they should stay in place.
00:52Well, you know, if you look at the longer cycles of industrial history, I think that in the long run, too much domination of a sector by too few companies has a bad track record.
01:03If this was the 1950s, we'd be saying General Motors, they're the greatest, they can do no wrong.
01:07We'd be saying Boeing, we need to leave them, don't mess with Boeing.
01:10We'd be saying IBM, don't mess with them, AT&T.
01:13But the fact is that when you have a company dominating a sector for too long, they start to stagnate.
01:18And so I think you've got to constantly keep at them.
01:20Look, I'm not saying that big tech has reached the state of Boeing, but I'm saying it is a duty of the government to constantly make sure that a sector stays lively and competitive, not stagnant.
01:32There was always an argument with regards to this sort of iteration of big tech.
01:35The idea that, yes, these companies were large, in some cases monopolies or quasi-monopolies.
01:40But the idea was that the products and services they were putting out were effectively lowering prices for consumers in some degree or another or offering some sort of conveniences that we would not have gotten.
01:50At least that's the argument they've certainly made in court as well.
01:53And I am curious, does that not hold water?
01:55I mean, there are a lot of things I'm paying for today that are probably significantly cheaper than what they would have been on a relative basis 20, 30 years ago.
02:02I mean, it depends on whether you're an advertiser or not.
02:05I think we had this conversation with the advertiser.
02:07They say, look what I'm paying to Facebook and Google advertising duopoly.
02:10It's outrageous.
02:11You know, I need a little more competition in this space.
02:13They've got it locked up.
02:14So I think it really depends.
02:16I mean, the genius has always been to make it look good for the consumer.
02:20But there's a lot of other parts of the economy, I think, that are being affected by big techs, a monopoly power.
02:26You know, all the companies have to advertise.
02:29You just take you take another.
02:30Yeah.
02:31Just as an example.
02:32But it gets to this idea and goes back also to the FT article, why we haven't seen more success in this space.
02:37I mean, during the Biden administration, which you were part of, obviously, Lena Kahn led the charge on a lot of the stuff there.
02:42I mean, she went after a lot of companies.
02:43Yeah.
02:44She didn't successfully win any cases.
02:46Let me back up.
02:47That's wrong.
02:47Google lost its case.
02:49Google was felt to be a monopolist and lost its case.
02:54I haven't seen any change, though.
02:56When I say failed, I don't necessarily mean you've got a judge to say we side with you.
03:00But what's been the consequence?
03:01I think if you look at the space that AI has had to grow.
03:04Yeah.
03:04Okay, look at OpenAI.
03:05Okay.
03:06You want a consequence?
03:07OpenAI is the consequence of pushing back Google.
03:10Okay.
03:10I mean, it's not the only factor.
03:12But you think, what would have stopped Google from just either or Microsoft?
03:16Microsoft has, let's say, would have stopped Google from either buying OpenAI or pushing Gemini into every single space?
03:23I mean, maybe you would have said, well, OpenAI is a better product.
03:25But I'm just trying to say, pushing back Google has had a big role in OpenAI's success.
03:29You want to look at something, that's your marker.
03:32Well, the Google case, let's talk about it a little bit more.
03:35Because something I wonder coming out of that was whether or not AI is basically going to solve this problem for you, so to speak.
03:42Whether or not that's going to, quote-unquote, break up big tech.
03:45Because you think about that ruling back in September against Google, the judge declined to order a divesture of Chrome or its Android operating system.
03:54And the logic was basically that the emergence of generative AI has changed the course of this case.
04:00And Google's a big example there.
04:02But there must be others out there as well.
04:04It's always a dual operation.
04:05If you study the industrial history of U.S. antitrust, there's always a little push by the government and then room to grow.
04:13If you look at Apple and you look at Microsoft, they grew because the government pushed back AT&T and pushed back IBM.
04:20So what the government does is it gives a little push, and it doesn't do the growth.
04:24It leaves room for other companies to grow.
04:26In the case of Google, in the case of this entire war, I mean, if you want to look at the byproduct, it has been the independent AI sector.
04:32And I think that is the most important thing that's come out of our effort.
04:35And also, just in fairness to you, your administration, and Lena Kahn, I mean, obviously, just the threat of that oversight certainly prevented some companies from moving forward.
04:45But on that point, though, we've seen underneath the surface, I mean, a lot of people focus on whether Alphabet's going to buy some other gigantic company, and that becomes an antitrust issue.
04:53But when you have these companies buying smaller companies that sort of fly under the radar, they're not big enough to really sort of, you know, get the attention of regulators.
05:00And we've seen these companies build themselves up through these smaller acquisitions to the point where they might as well have just gone out and bought a big company.
05:07How do you combat that?
05:07I mean, I think that's a problem, honestly.
05:09I think we have, at times, allowed some of the big tech companies to own too many of the sort of talent pool individuals who would be in another era those who would challenge the big guys.
05:21Look, I'm not against tech.
05:23I'm not against growth by any means.
05:25I just think American tech has been successful because there's a cycle of challenge of entrepreneurship, and I do think it's important that we don't let the big guys buy every single entrepreneur.
05:34Are the laws and regulations in place today sufficient enough to address that?
05:37They would be if the judges enforced them.
05:40You know, I think we could improve the laws.
05:42I think they have not always been as strong as they could be.
05:48But, I mean, it's constantly a balance.
05:49And I just want to say it's a push and pull.
05:52The U.S. tech sector, in ways, is successful because the government has always been on the side of entrepreneurs.
05:57So we're talking, of course, about the tech sector.
05:59You say that you're not against big tech.
06:01But you think about these sort of antitrust concerns, these monopoly concerns.
06:05Is it unique to the tech sector at this point?
06:08No, not at all.
06:09I mean, I think some of the worst, most concentrated sectors are outside of tech.
06:14You know, agricultural seeds, just to take a random example.
06:17Parts of broadband are very concentrated.
06:21You know, it's often very unglamorous industries, like farm tools or something like that, that, frankly, could use a little shakeup, frankly, have allowed too many uncompetitive mergers.
06:31Glamorous to someone out there.
06:32Yes, that's true.
06:34Glamorous to someone.
06:35But then just to kind of circle this back, too, and the way Katie kind of framed this, too, is just the importance of these companies to our economy, for better or for worse.
06:43They contribute a lot to GDP.
06:44They contribute a lot to hiring and labor growth.
06:46So how do you approach the potential for either breaking up these companies or constraining them without also constraining the economy?
06:53I think it's important.
06:54I think the track record of competition is better than the track record of monopoly.
06:59So I think that we become enraptured and in love with big companies.
07:03And, look, they're certainly impressive.
07:07Their leadership, their talent is impressive.
07:08But the long course of American capitalism has always been more successful with competition and not with monopoly.
07:15And I just go back to the 50s.
07:16I go back to the 70s.
07:18Do we really want General Motors, Boeing, like AT&T and IBM to be the future of the U.S. economy?
07:24Or do we want to have a more competitive, vibrant kind of economy?
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