Big Tech Won’t Waste the Covid-19 Crisis
Never let a good crisis go to waste, a phrase attributed to Rahm Emanuel referring to the opportunities that may present themselves in a crisis, articulates nicely the approach technology companies have had to the Covid-19 emergency. Opportunism is of course a key component of their nature but their shamelessness is only matched by the gullibility of the public at large. So as an exercise in critical thinking, let’s take a step back for a minute and put ourselves in their shoes. If you were a giant technology company in the midst of a global pandemic, what opportunities might you see?
First of all, given the increasing rate of mainstream scandal and criticism surrounding technology companies, you would want to change the conversation. Specifically, there was an enormous backlash growing against their deceptive and invasive surveillance model. In essence, this model reduces all human experience, from doing homework to jogging in the park, the conversations you have in your living room to everything you view online, to data. This data is then transformed by Artificial Intelligence into predictive algorithms, which are placed at the service of Big Tech’s real customers, not you or I, but advertising agencies, insurance providers, car manufacturers, political parties, etc. There was growing concern for how all of this data was being used and how much power it gave the handful of companies that control it. But now it is precisely their surveillance model that is being looked at as a key ally in the fight against Covid-19, allowing governments to monitor people’s adherence to “social distancing”, “stay at home” emergency lockdown laws and the dynamics of contagion. This crisis not only wipes concern for their surveillance off the map but even offers them the opportunity to promote it.
Similarly, social media had lost much of its luster to many older users. At the very least adults were becoming aware that there were demonstrable efforts from many organizations, including Facebook itself, to directly manipulate users for political, commercial and, in the case of Facebook, experimental aims. Now, with tens of millions of people forced to stay at home, social media has become an indispensable tool for the only human contact allowed: virtual contact. It won’t be long before you start to see deliberate advertising from the major players, spinning Covid-19 isolation into a celebration of social media.
Google, for example, wasted little time to promote their EdTech line of products, G Suite for Education. As soon as it was evident that hundreds if not thousands of schools worldwide would be forced to transition completely to online learning, they began promoting their services in a thinly veiled marketing and PR campaign, including a $50 million dollar donation to the Covid-19 fight. $50 million dollars might sound like a large amount, and I stress might, if you have no reference point. So let me provide that for you: Youtube alone generated $5 billion in the last three months of 2019; Google Search brought in $98.1 billion for the year. According to some estimates, Google’s parent, Alphabet (which owns Google Search, Youtube, Google Home, etc.) has an $18 billion a year marketing budget. Want to guess where the $50 million “donation” came from?
Speaking of money, let’s talk about taxes, as in the taxes that Google and Big Tech companies don’t pay (while the rest of us do). Taxes, which pay for things like schools and hospitals, was one of the hot button topics surrounding Big Tech recently, for good reason. Basically, companies like Google and Facebook don’t pay taxes for a lot, maybe most, of their revenue making operations, especially outside of the U.S. Of the taxes they do pay, over the 10 year period 2010–2019, the “Silicon Six” (Facebook, Amazon, Google, Microsoft, Apple and Netflix) has found loopholes to avoid paying up to $100 billion in taxes. More recently, the EU had finally mustered the political will to propose new tax legislation to address the “disconnect — or ‘mismatch’ — between where value is created and where taxes are paid.” This value is created by a “combination of algorithms, user data, sales functions and knowledge” and is currently not taxed “in the country of the user (and viewer of the advert), but rather in the country where the advertising algorithms have been developed”. This new proposal, fiercely attacked by the companies and President Trump, is based on a rate of 3% that could generate up to €5 billion annually, per EU member. As a point of reference, Facebook’s revenue in 2019 was about $70 billion gross, $18 billion in profit. Spain’s national health system, recognised as one of the best in Europe, and currently buckling under the strain of Covid-19, costs about €68.5 billion annually. Had the EU’s tax measure passed when it was proposed in 2018, the Spanish and Italian governments could have an additional €10 billion at their disposal right now, even at the ridiculously low rate of 3%. Those “free” tools offered to schools and the $50 million donation offered by Google, in light of its massive income and the taxes it doesn’t pay, is more like a slap in the face.
The disorientation and shock caused by the Covid-19 twin crises, the medical and the economic, will allow Big Tech to get away with everything the world was finally growing aware of and concerned with. All they have to do is lay low, throw us some crumbs, and when the dust settles, the conversation will have changed completely. In the end, they will have seized the opportunities found among the piles of unburied bodies and the ruins of underfunded health and education systems.
