Big Tech’s reputation has deservedly taken a beating in recent years, but there is one way to restore some respect, and it makes business sense.
Big Tech – Google, Facebook and Amazon in particular – has had a serious image problem for several years. Whether it has been spreading misinformation, undermining democracies, or paying minimal or no tax, Big Tech has a lot to answer for.
If those firms can step up and support struggling businesses through the pandemic with advertising grants, they can repair their reputations and make their balance sheets even stronger in the long run.
Big Tech CEOs’ mauling by Congress during July’s antitrust hearings should have been a wake-up call: as lawmakers in those companies’ biggest market consider breaking up what are de facto monopolies, many tech execs will be asking how they got here.
It is those huge firms’ tax avoidance strategies that have raised perhaps the most criticism – in February the Internal Revenue Service sued Facebook for $9 billion in unpaid taxes, and I believe that governments would view them much more positively if they paid what is considered their ‘fair share’ of tax.
This tax position has become even harder to justify as much of the world enters a pandemic recession, which could be deeper and longer than the last downturn in 2008. But this recession is different. There is one sector – tech in general, and Big Tech in particular – that is not only immune to the economic fallout, but is prospering throughout this downturn.
In the last six months, Google’s stock price has risen by 30 percent. Facebook’s stock is up nearly 60 percent, as is Amazon’s, leading Jeff Bezos’s wealth to surpass $200 billion thanks to the pandemic.