Susannah Streeter examines whether the all-encompassing influence tech corporations have over our lives is being sufficiently scrutinised

Whether you are one of the many millions who has a voice-activated home assistant or are thinking about letting your smart fridge order your groceries, you might not have thought that deeply about the risks that come along with all the convenience these technologies give us.

Privacy concerns have been raised about the security of feeds from video doorbells and baby monitors. If I can view it on my phone, when I’m far from home, who else might be watching? But what of the deeper, more complex risks that stem from our dependence on all this technology, the freedoms we surrender in exchange for it and the dominance of the global giants who control it and, by extension, our lives?

At the end of last year, I chaired a discussion organised by the cyber security firm Kaspersky. One of the issues raised was the degree to which tech giants’ control over their ecosystems enhanced or undermined their security. Trying to exercise proprietary control over technologies is nothing new. The EU has played its part in reducing the myriad mobile phone chargers that used to clutter up our drawers. And the battle that printer manufacturers have long fought to steer us towards their own, branded ink cartridges, rages on.

But now, some are warning, the stakes may be significantly higher than paying a bit more for the right phone charger or ink cartridge. We have placed the security of everything from the money in our bank accounts to our most personal and sensitive secrets in the hands of a few giant businesses.

The Kaspersky panel included the technologist, journalist and author Cory Doctorow, who has written extensively about the risks inherent in our increasing dependence on technologies over which a small group of companies exercise ever tighter and less transparent control. One of the issues that Doctorow has highlighted is the expansion and use of legal mechanisms originally designed to protect innovators and nurture innovation, such as copyright, patent and trademark laws, to inhibit customer mobility and suppress competition.

Now corralled under the somewhat loose term “intellectual property”, Doctorow says the reach of the legislation has been extended and supplemented, to an extent that enables big companies to “control the conduct of (their) competitors, critics and customers.” Digital rights management software (DRM) and the legal protections established around it, is just one example.

Most of us vaguely understand DRM as a tool used to prevent the illegal copying of movies, music and software. But who knew that DRM is built into all manner of everyday products, from our cars and printers to hospital ventilators, in order to control how we use them, inhibit our ability to maintain them and can be used to make them obsolete, forcing us to upgrade?

Where once interoperability – the openness of products to work with others – was prized and transparent, it has been eroded by the increasing control that a few companies in many different markets now exercise. What was seen as a benefit, to be promoted, is now seen as a weakness that might open the door to a competitor’s advantage. But where is the real risk here? Surely, one reason companies want to exercise such tight control over their products is security. By limiting the ability of anyone but their own employees to use or develop their products in any but strictly proscribed ways, they are protecting their software and marketplaces, and ultimately us, their users.

Doctorow argues that the opposite is true. By opening products up to the scrutiny, maintenance and enhancement of anyone who might be interested, security is generally enhanced. The tight control exercised by manufacturers exacerbates other risks too. The demise of interoperability and the denial of our right to affordably maintain our devices, contributes to shorter product lifecycles and the growing mountain of “bricked” devices casting a shadow over our efforts to preserve our environment.

Making the markets more competitive

All of these issues and many more, lie behind the growing clamour for the big tech giants to be more tightly regulated or even broken up. Some commentators, such as Scott Galloway, a Professor of Marketing at NYU’s Stern School of Business, have argued that forcing the “big four” into becoming the slightly-less-but-still-very-big-eight or ten would be good not just for the market but, in the longer term, for the companies themselves.

The history of meaningful anti-trust enforcement in the US has long quiet spells, but what evidence there is suggests that Galloway may be right. Breaking up AT&T in the early 1980s and the action against Microsoft over its browser dominance in the late ‘90s may have brought both companies some short-term pain but they and their respective markets went on to flourish.

Alongside the privacy, security, market and environmental risks, there is another that comes to mind that, as far as I’m aware, has been discussed even less. Looking at the share prices and balance sheets, it seems almost absurd to suggest it, but what if one of these giants were to collapse?

As a BBC reporter covering the global financial crisis that erupted in 2007, I remember the term “too big to fail” shifting from a journalistic question to government policy over a matter of days. Having thrived in the pandemic, it seems unthinkable that Alphabet, Apple, Facebook or Amazon might struggle in the face of anything the global economy might throw at them.

But wouldn’t we have said the same of Lehman Brothers in, say, 2005? And what about AIG, Royal Bank of Scotland, ABN-Amro and Northern Rock? The difference may be that these companies are not just too big to fail. They are rapidly becoming too big to save. And who, even two years ago, would have dreamt that the political stability of the country in which all four companies are based might be called into question after rioters invaded its seat of government?

The consequences of such a failure are too vast and complex to try to iterate here, but ask any currently home-schooling parent what would happen if just Google Classroom fell over. In my day job as a financial analyst and commentator, barely a week goes by without me reminding investors of the importance and benefits of diversification. Perhaps having all our technological eggs in so few baskets isn’t such a great idea either.

About the author

Broadcaster and commentator Susannah Streeter is a senior investment and markets analyst with Hargreaves Lansdown and a former BBC Business Anchor.