2020 has been a roller coaster ride for everyone – individuals, governments, businesses and society on the whole. There’s no doubt that it has been a disruptive year for Big Tech too. A series of events during the pandemic leaves Apple, Amazon, Facebook, Google, and Microsoft poised for continued growth and increased regulatory scrutiny. Here’s a snapshot.
Google – A mixed bag
For Google and its parent company Alphabet, 2020 was a year of ups and downs. The company experienced its first revenue decline ever during the second quarter of the year.
On March 3, Google confirmed that it would be canceling its annual Google I/O developer conference — its biggest event of the year — due to concerns about the coronavirus.
In a company memo sent in July, Google announced that employees could work from home until at least July 2021,
On July 29, CEO Sundar Pichai, along with Amazon CEO Jeff Bezos, Apple CEO Tim Cook and Facebook CEO Mark Zuckerberg, was testified before Congress in an antitrust hearing. The hearing followed a year-long investigation of the four tech giants to determine whether the companies had abused their power and dominance in the online marketplace.
Pichai faced criticism of potential political bias in how Gmail sorts certain mail into the spam folder, during the hearing, but he denied this was the case.
In October, the US Department of Justice sued Google for violating antitrust laws. According to the filing, the lawsuit is intended “to stop Google from unlawfully maintaining monopolies through anti-competitive and exclusionary practices in the search and search advertising markets,” and marks the biggest tech antitrust lawsuit in more than two decades
In October, Pichai, along with Twitter CEO Jack Dorsey and Zuckerberg, faced questions by senators on the Commerce Committee over their respective companies’ content moderation policies. During the hearing, Pichai said Google approaches its content moderation without political bias.
Despite the odds, Alphabet shares rose 8% after the company released its financial report for the three months ending in September. Alphabet reported revenue of $46.17 billion for the third quarter, which marked a 14% increase from the same period last year. It was also a notable quarter for Google Cloud.
Facebook – Huge growth despite criticism
Facebook is one of the companies that has benefited from the coronavirus pandemic. Active users surged in the second quarter of 2020, and its monthly active users, revenue and net income surged compared to the same period last year, according to the company’s latest financial report.
However, Facebook faced its fair share of controversy and criticism as well, including an employee walkout, an advertiser boycott, multiple Senate hearings on its content moderation policies and, most recently, a federal antitrust lawsuit.
In June, for example, a civil rights coalition launched the #StopHateforProfit campaign. The campaign called on major corporations to pause their advertising on Facebook in response to the company’s “repeated failure to meaningfully address the vast proliferation of hate on its platforms.”
A number of major brands joined the boycott, including Adidas, Coca-Cola and Verizon, to name a few.
On October 28, Zuckerberg was questioned by senators on the Commerce Committee over their content moderation policies. During the hearings, Zuckerberg said Facebook aims to be “fair and consistent” in its policies and decision-making when it comes to its moderation practices.
On December 9, the Federal Trade Commission, along with the attorneys general of 46 states,
sued Facebook for illegal monopolization. The lawsuit accuses Facebook of “anti-competitive conduct” and focuses on its acquisitions of Instagram and WhatsApp, which the FTC alleges were illegal and should be sold off.
Despite adversities, Facebook tops 3 billion users for the first time. The pandemic triggered more people around the globe seemed to have turned to social media and other communication apps to stay connected — which has been a boon for Facebook.
Facebook followed Google and Twitter in announcing extended work-from-home policies until July 2021. This year Facebook also made a few acquisitions – notable among them was the GIF-sharing platform Giphy in mid-May in a deal valued at around $400 million. In late November, Facebook acquired Kustomer, a startup that focuses on the customer services industry for $1 billion.
Amazon – A blessing in the time of Covid-19
While the coronavirus pandemic has been a challenge for most companies across the globe, it’s been a blessing for Amazon as consumers continued to shop from home amid the pandemic.
Despite some hiccups along the way it’s been a phenomenal year of growth for Amazon — and its CEO and founder Jeff Bezos, whose wealth surpassed a record $200 billion this year.
On the key challenges, the company had to temporarily suspend shipping on nonessential items due to overwhelming demand in March as more and more people shopped from home. And it also had to contend with scrutiny over how it was keeping its employees safe (with many of its employees were reportedly diagnosed with coronavirus). Overall, however, Amazon has come out on top.
On April 13, Amazon announced that it was hiring for an additional 75,000 positions after bringing on over 100,000 new employees over the previous four weeks, the company said in a blog post.
“We continue to see increased demand as our teams support their communities, and are going to continue to hire,” the company said.
Amazon shares topped $3,000 for the first time ever on July 6, pushing its valuation over the $1.5 billion mark. Amazon became the third company to do so, following Apple and Microsoft.
In July, Amazon announced its second-quarter results — net sales had increased by 40% to $88.9 billion and earnings were up despite high spending on coronavirus-related measures.
“This was another highly unusual quarter, and I couldn’t be more proud of and grateful to our employees around the globe,” Bezos said in a statement.
In October, Amazon also had one its biggest Prime Day and continued its holiday sales through Cyber Monday. Although the e-commerce giant didn’t release official numbers, it announced in a Dec. 1 blog post that this year’s holiday shopping season had been “the largest holiday shopping season so far in our company’s history.”
Microsoft – Cloud the Savior
The coronavirus pandemic has fueled demand for cloud-computing services, video gaming and computers, all of which has been good news for Microsoft. The company closed a record fiscal year in July with $143 billion in revenue — up 14% — and a $44.3 billion net profit.
There weren’t many activities around Windows 10, and in fact the operating system probably had its quietest year ever. There was buzz however that a lot was going on in the background. The delays of Windows 10X, and Surface Neo and other dual-screen devices, was indeed disappointing.
Surface Duo however proved to be an impressive piece of hardware this year, as Microsoft produced an excellent device in the form of Surface Laptop Go, which was a lesson in how to make an affordable notebook that doesn’t compromise on quality and style.
Edge had a good show throughout the year, and is now the second most popular browser after Chrome. Moreover, Microsoft picked up momentum considerably on the gaming front, most notably with its ZeniMax deal. Xbox Game Pass for PC solidified its reputation as a great value proposition.
The Redmond’s cloud computing business accelerated and its Teams messaging and collaboration software won new users, owing to the pandemic-driven shift to working from home and online learning drove quarterly results ahead of investor targets. As of October, revenue from Azure, the company’s cloud-computing service, had increased 48% from the previous year, The Wall Street Journal reported.
Microsoft also announced its acquisition of Boston-based Affirmed Networks in March that would allow the company to evolve our work with the telecommunications industry, especially in its forthcoming activities around next-generation 5G connectivity.
Apple – Dawning of a new era in Macs
Despite the Coronavirus crisis, Apple’s year has been nothing short than stellar. Not only did the company release its annual iPhone updates, new Apple Watch hardware, and new iPad hardware, it also undertook a massive transition on the Mac side of things with the first Apple Silicon-powered machines.
The company introduced its most expansive iPhone lineup yet, updated the Apple Watch, undertook a major overhaul of the Mac lineup, and much more during the year.
Remote working and learning boosted sales of iPads and Macs earlier in the year, propelling Apple to reach a record valuation in August. And despite store closures and supply chain issues, Apple moved ahead with the launch of several new products this year, including the 5G-enabled iPhone 12. On April 15, Apple announced its new iPhone SE, an “affordable” addition to the iPhone lineup with prices starting at $399.
On July 29, Apple CEO Tim Cook, Amazon CEO Jeff Bezos, Facebook CEO Mark Zuckerberg and Google CEO Sundar Pichai testified in front of Congress following an investigation into possible abuses of their power and dominance in the online marketplace.
In August, Apple’s market value was above $2 trillion at the market close for the first time ever. It had briefly surpassed the milestone the day before but dipped back down by market close.
It took longer than expected, but the iPhone 12 has finally arrived this year. On October 13, Apple unveiled its latest iPhones, including the iPhone 12, iPhone 12 mini, iPhone 12 Pro and iPhone 12 Pro Max, all of which feature 5G technology.
Apple reported $64.7 billion in revenue during the third quarter, up 1% from the same period last year and $1 billion ahead of analyst expectations. Still, shares dipped 5% following the report of its financial results, perhaps in response to a slowdown in sales compared to the previous quarter.
Finally, in November, attention shifted back to the Mac with Apple holding its third and final event of the fall. The headlining announcement during the November 10 event was the M1 processor, Apple’s first system-on-a-chip for Mac computers. Apple announced a trio of new Macs powered by the M1 processor: the MacBook Air, the 13-inch MacBook Pro, and the Mac mini. 2020, one can say is the dawning of a new era in Macs.
Apple has been coming under increasing antitrust pressure, most of it focused on the App Store. The company had long rejected all criticisms of both the advantages the company gives its own apps over competitor ones, and its 30% cut of app sales. Both things changed in 2020. So, on the whole we can say, the Cupertino major had a stellar run this year, despite some disappointments as we said earlier.
In many ways, the world’s largest tech companies were the saviors of 2020 – enabling most of us to stay connected, entertained, and mostly sane during difficult times. The Big Tech also bagged great growth figures this year. So even though 2021 will see extensive reformation in the industry, led by Big Tech and other disruptive companies, one cannot ignore the backlash they faced in 2020 with the US, the European Union and even China taking dramatic steps to curb their dominance. That pressure won’t be going away in the new year. And this would be an interesting space to watch out!