Farhad Manjoo writes:

The stock market has lately soured on the technology industry. Stock prices of many of the largest companies are down this year, some slightly — shares of Apple and Google have fallen more than 6 percent — and some stupendously: Facebook’s parent company, Meta, and Netflix have lost about a third of their value since the New Year. Because surging tech stocks drove a big part of the stock market’s rise in 2021, their decline has contributed much to the market’s fall. The S & P 500 is down by about 7 percent in 2022.

It’s obvious why investors are spooked. Omicron, inflation, likely interest rate hikes, a possible war in Europe, Canadians acting very un-Canadianly — unpredictable forces have taken hold of the global economy, so it’s not unreasonable to expect trouble ahead for some of the largest companies in the world.

But in the last few weeks, as corporations announced their financial performance for the final months of 2021, I’ve found it hard to focus on what might now go wrong for the tech industry.

Amazon, Apple, Google and Microsoft — the four American companies now worth more than a trillion dollars each (actually, Microsoft is above $2 trillion, and Apple nearly $3 trillion) — reported enviable growth in 2021. Even Facebook’s disappointing earnings were relative: The company’s profits grew by 35 percent in 2021, down from nearly 60 percent growth in 2020.

So the much bigger story is that after all that has gone right during the pandemic for the largest companies in tech, they now seem poised to expand their reach and influence over the rest of the economy, rather than relinquish it.

Perhaps it’s not very surprising that the largest tech companies did really well during a pandemic that had a lot of us spending lots more time with technology. Yet the scale of their growth is staggering. [Continue reading…]