Episode 2 — Playing with the big boys
On Wednesday, July 29, four CEO’s of the American Tech Giants (Facebook, Google, Apple and Amazon) tried to prove that in fact, they didn’t monopolize the digital world. Yet.
It’s funny that today they’re throwing accusations of oligopoly, but haven’t reacted at all when Mark Zuckerberg bought Instagram for one billion dollars back in 2012, which made him an indisputable king of social media.
Four companies, which together are bigger than Germany’s GDP (2019), drive a hard bargain. They no longer need to throw elbows at the digital table. They decide what’s being served and who can join them for dinner.
So is there a way to sit with the big boys if you’re a relatively small platform with several dozen million users? The four companies mentioned before are tied with money for sure. But there is one more important factor in their dominance. They’re all from the USA.
It’s no mystery that good origin opens many doors, even when it comes to the tech world. Being based in Silicon Valley you’re just more credible. And just like all roads lead to Rome, all important things in the digital world happen in the Valley.
But what if you come from a country with internet censorship, social ranking system and is historically known for disregarding intellectual properties, stealing tech ideas and implementing them into national products as their own? Well, you have to get your foot in the door somehow.
How to achieve that? Of course, you can pump millions of dollars into the marketing department, paying top-notch celebrities to smile while holding your product (live long, Huawei), but there is one thing money can’t buy. Trust.
Most teenagers don’t bother the app they have installed is sharing their personal data with a server room in Beijing. „Oh, that youth of today” one may say. „They don’t value their privacy enough”. Well, in my opinion, that’s because they are aware that they are invigilated anyway. All social media platforms gather their data in exchange for free access. It’s completely normal.
Then we have the pre-internet generation. They know the price of free access. Although they don’t like it, they accept it as long as the data ends up in Palo Alto. But China is a whole different story for them. Tik Tok realized it can’t get rid of its Chinese pedigree, so it tries hard to become more American.
Besides sending an army of lobbyists to the US, it made other bold moves to buy into the grace of American Congress and Donald Trump. Moves include the creation of 10 thousand jobs in the USA and making Kevin Mayer, the former Disney’s streaming platform president, its new CEO.
But as it turned out, Trump is as merciless for Tik Tok as he was with the Afro-American athletes kneeling down for the national anthem. The only difference is that nobody will kick Colin Kaepernick out of the country.
Why is Tik Tok so manically afraid of losing out on the western market? Take a look at the statistics. US market accounts for mere 50 mln Tik Tok users. Given that, Tik Tok should rather focus on saving its Indian branch, where it gathered twice more users, right? Well, crunching on the data reveals one more thing, namely the operating system share.
It turns out most of Tik Tok’s iOS users come from the US. And while they tend to spend 2,5 x more on games and apps than Android users, they become crucial from the business perspective.
To sum up, as in every thrilling story, the stakes are high. And this time it’s a fight for influence, identity and a whole lot of money. Will Microsoft save Tik Tok’s future, taking over the responsibility of gathering user data? Is the USA banning the app in the country, acquiring China’s methods of dealing with outside influence?
We’ll focus on those issues next week. We’ll also try to understand who really makes the „youth of today”, that is responsible for Tik Tok’s popularity.
The episode is also available in Polish as a podcast here: https://soundcloud.com/rafa-opali-ski-997694920/odcinek-2-stolik-dla-doroslych