The Trump administration just recently announced that they are looking into antitrust violations by large technological firms, such as Amazon, Facebook and Google (CNBC). At first glance, our business plan writers thought that this may be detrimental not only to the large technology industry but to small technology businesses as well. However, upon further analysis, antitrust movements against large technology organizations may actually be a boon for small technological startup businesses. Here are our arguments for the benefits:
Strategic Planning for Large Corporations Distracted
Large corporations, especially technology corporations, are in the unique position where they have excess funds to devote to strategic planning on almost a continuous basis. Unfortunately, small business technological startups, based on feedback from our business plan writers, do not have this luxury. With the introduction of antitrust examinations, large corporations will need to devote significant manpower not only to complying with the administration’s request for documentation but also to lobbying congressional representatives in an attempt to mitigate the scope of the proceedings. In the end, this distraction, regardless of how long it is an issue, allows for small technological firms to possibly use this distraction to exploit niche markets that may be missed by large companies due to the proceedings.
Large Technology Corporations Divert Scarce Financial Resources to Other Source… than Operation
Another benefit for small startup technology companies, based on research from our business plan writers, is that large corporations will need to reallocate financial assets to fund actions focused on mitigating antitrust examinations. These financial assets may come from research and development, new project implementation or even marketing. In our opinion, the source of the funding is almost irrelevant. Every penny that a large corporation is not the voting towards operations or advertising is an opportunity cost that small technology companies need to exploit to the fullest.
Opportunities for Global Competitors to Enter U.S. Market
With all the benefits noted for the administration’s focus on antitrust violations for large technology corporations, there are detrimental effects that me even impact small businesses in the technology industry. To illustrate this, with financial and human resources reallocated away from operations, large technology organizations in other countries, such as the EU and China, may view this opportunity as a golden ticket to fund our markets with foreign technological advancements. This action may help consumers. However, US corporations, as a whole, lose out from actions taken by our home country’s government.
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Author: Paul Borosky, Doctoral Candidate, MBA.