Bill Gates: Don't break up tech giants, it won't stop anticompetitive behavior

Microsoft co-founder Bill Gates thinks breaking up tech giants isn't an effective answer to antitrust concerns.
Written by Liam Tung, Contributing Writer

Bill Gates is no stranger to US antitrust laws and to the threat of having his company, Microsoft, being broken up as happened to AT&T in 1984. 

Microsoft dodged a forced divestiture after its 1990s battles with the Department of Justice, and Gates thinks it would be a bad idea for regulators to break up tech giants like Google, Amazon and Facebook, which are currently under investigation for anticompetitive behavior

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Speaking with Bloomberg, Microsoft co-founder Gates said it is better to regulate big tech companies. Breaking them up will simply result in two companies indulging in bad behavior. 

"I don't know the last time a company was broken up… but you have to really think, 'Is that the best thing if there's a way that a company's behaving that you want to get rid of?' Then you should just say, 'Hey, OK, that's a banned behavior'," said Gates. 

"Splitting a company in two and having two people doing the bad thing, you know that doesn't seem like a solution," he added. 

Gates said it was a "pretty narrow set of things" where a break-up would be a suitable solution. 

"I was naive about this but that was a long time ago and I didn't realize that as Microsoft gets successful we'd come under scrutiny and we went through our thing back in the 1990s and that's made us more thoughtful about this kind of activity," he said.

Gates has been vocal lately about the software industry that Microsoft once dominated more completely. Expressing his regret at Microsoft not making Android, he recently said the software world was a "winner-takes-all" market

"It really is winner-takes-all," Gates said. "If you're there with half as many apps or 90% as many apps, you're on your way to complete doom. There's room for exactly one non-Apple operating system."

Gates' latest comments follow this month's launch of an antitrust investigation into Google's advertising business that's being conducted by 48 state attorneys general. 

That investigation comes on top of the US Department of Justice (DoJ) antitrust review into the tech industry's competitive conditions and reports that the DoJ and the Federal Trade Commission (FTC) are preparing to open up antitrust investigations into Google, Amazon, Apple, and Facebook.

Presidential candidate Elizabeth Warren earlier this year proposed breaking up Silicon Valley giants in the name of competition, singling out Amazon's acquisitions of Diapers.com and Zappos, and Google's acquisition of DoubleClick and Nest. 

SEE: 50 US states, territories launch Google antitrust probe

As for tech companies paying taxes and dealing with the impact of social media, Gates thinks it's really up to society to demand changes and for governments to implement them. 

"Government really needs to talk about what those rules should be. You could say I'm biased, but I see these as well-meaning, highly innovative companies. It's up to society to make sure that their innovation doesn't have negative side-effects," he said. 

Gates also told the Financial Times that fossil fuel divestment has had zero impact on emissions. 

"Divestment, to date, probably has reduced about zero tonnes of emissions," he told the paper. "It's not like you've capital-starved [the] people making steel and gasoline," he said. "I don't know the mechanism of action where divestment [keeps] emissions [from] going up every year. I'm just too damn numeric."

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