Have digital giants taken control?

Our lives today are shaped by a hand­ful of omni­present play­ers. Google determ­ines our access to know­ledge, Amazon gov­erns our pur­chases, and Meta orches­trates our social inter­ac­tions. Behind these giants, the same “win­ner takes all” logic dom­in­ates. Joëlle Toledano, pro­fess­or emer­it­us and mem­ber of the Nation­al Digit­al Coun­cil (CNNUM), deciphered this dynam­ic in her book “GAFA, repren­ons le pouvoir en 2020” (GAFA, let’s take back the power in 2020). Charles Thi­bout, who has a doc­tor­ate in polit­ic­al sci­ence and is an asso­ci­ate research­er at the Insti­tute for Inter­na­tion­al and Stra­tegic Rela­tions (IRIS), has focused on the spe­cif­ic case of Google in France, hav­ing devoted his thes­is, defen­ded in Octo­ber 2024, to this subject.

Joëlle Toledano. These play­ers began by estab­lish­ing their dom­in­ance over ser­vices that won pub­lic sup­port, such as Google with its search engine or the social net­work Face­book. An eco­nomy of fixed costs, growth in these digit­al ser­vices that eco­nom­ists call “plat­forms” can be deployed with pro­por­tion­ally lim­ited costs and power­ful net­work effects, mak­ing the ser­vice increas­ingly attract­ive. Each new user makes the ser­vice more attract­ive, the tar­geted advert­ising more inter­est­ing and the com­pet­i­tion more dif­fi­cult. Sales and profits increase with data fed into algorithms. As a res­ult, an almost ines­cap­able mono­poly gradu­ally sets in, leav­ing little room for viable altern­at­ives. Admit­tedly, Tik­Tok has made its mark, and OpenAI and its com­pet­it­ors are try­ing to take Google’s place, but to date, Meta and Google still dom­in­ate to a very large extent, not only in terms of usage, but also by steal­ing the advert­ising mar­kets that serve as ‘cash cows’ to pre­pare for the future.

Their products have become indis­pens­able to the point of rede­fin­ing the way we com­mu­nic­ate, get inform­a­tion and even the way we con­sume. How­ever, these com­pan­ies were not born out of a need pre­vi­ously expressed by their users, but rather out of the desire to cre­ate a new need. Today, cut­ting your­self off from social media could have both per­son­al and pro­fes­sion­al con­sequences. So, let’s not even talk about get­ting away from a tool as use­ful as the Google search engine. All the same, we must be care­ful not to take an entirely neg­at­ive view of these com­pan­ies [Editor’s note: the eco­nom­ic and polit­ic­al influ­ence due to the mar­ket power of these com­pan­ies]. Because their profits are also sig­ni­fic­ant, which shows that there was a real need for them.

How­ever, it is not enough to cre­ate a need that revolu­tion­ises the lives of users to ensure a sub­stan­tial eco­nom­ic income. Each of these play­ers seeks to cre­ate a world that you would have no desire or interest in leav­ing. It is an eco­nomy that revolves around the user­’s atten­tion and avail­able brain time, so that they con­sume advertising.

In addi­tion, the indis­pens­ab­il­ity of a com­mer­cial ser­vice, such as Amazon, also leaves very little choice for traders wish­ing to take advant­age of it. The plat­form, in its terms of use, has estab­lished a num­ber of rules to be fol­lowed. The e‑commerce giant there­fore reserves the right, via its algorithms, to decide how oth­er traders access their ser­vice. The eco­nom­ic advant­ages of hav­ing a busi­ness on this site are such that, for some, com­ply­ing with the rules and pur­chas­ing Amazon’s logist­ics ser­vices or advert­ising can become a neces­sity. The com­pany thus becomes the total mas­ter of the com­mer­cial mar­ket, and also of part of the loc­al eco­nomy of the coun­tries in which it has estab­lished itself. And speak­ing of Amazon, their strength is also due to their AWS cloud ser­vice. There are a sig­ni­fic­ant num­ber of com­pan­ies that depend on it today. As is the case with the num­ber of eco­nom­ic play­ers in each coun­try that depend on net­works for their mar­ket­ing communications.

Charles Thi­bout. Rela­tions between states and mul­tina­tion­als have always exis­ted, even if they fluc­tu­ate. There has nev­er really been a clear split between the pub­lic and private spheres. Power is nev­er totally in the hands of a par­tic­u­lar insti­tu­tion or act­or. It will always be the res­ult of nego­ti­ations between dif­fer­ent act­ors. And, depend­ing on the his­tor­ic­al con­text, cer­tain types of com­pan­ies, depend­ing on their own strengths, will have an advant­age over oth­ers in these nego­ti­ations. Today, in the digit­al age, the web giants inev­it­ably have more weight.

Google’s estab­lish­ment in France was still fraught with dif­fi­culties. From 2003, a year after the cre­ation of its Parisi­an sub­si­di­ary, Google suffered attacks from vari­ous French eco­nom­ic sec­tors. In fact, its arrival unsettled many people, and the polit­ic­al author­it­ies quickly became involved. Not­ably in 2005, with Jacques Chir­ac try­ing to ini­ti­ate European pro­jects aimed at com­pet­ing with the Amer­ic­an giant. This pro­ject was not suc­cess­ful, but it demon­strated France’s desire to safe­guard its nation­al sov­er­eignty. French mis­trust of Google would even­tu­ally fade from 2010 onwards, and its image would shift towards that of a poten­tial part­ner in pub­lic policy. It was at that point that Google would be seen, in polit­ics, as a means of show­cas­ing the abil­ity to inter­vene and act on the world, even though all the indic­at­ors of polit­ic­al impot­ence were there. We see this, for example, with the use of Google tech­no­lo­gies by the tax author­it­ies. The per­cep­tion of the mul­tina­tion­al is chan­ging, French politi­cians are now seek­ing to attract these giants to France and con­vert their cap­it­al into polit­ic­al resources.

CT. Under Hollande’s five-year term, a slight dip could still be observed. In addi­tion, a tax search of the multinational’s Par­is offices took place in 2016. This event, jus­ti­fied by a tax adjust­ment pro­ced­ure, was exper­i­enced by employ­ees as a real attack, with par­tic­u­larly dam­aging effects on the image of their com­pany. Google is the first com­pany in France to under­go such a pro­ced­ure on this scale. Its reac­tion was to do everything it could to reappear as a nor­mal, respons­ible com­pany. And, as such, to be able to bene­fit from the same priv­ileges as large French companies.

A recent Stan­ford report high­lighted that around 70% of PhDs spe­cial­ising in AI end up in the private sec­tor, and only 20% in academia.

Google then decided to become French through a pro­cess called the “indi­gen­isa­tion” of the com­pany. This pro­cess involves two things. First, it is neces­sary to recruit French staff, but also staff in high pos­i­tions in the polit­ic­al and admin­is­trat­ive field, such as former seni­or civil ser­vants. Then, it will be neces­sary to build a sys­tem of alli­ances with oth­er French eco­nom­ic play­ers. These alli­ances would become a major ele­ment of Google’s indi­gen­isa­tion strategy dur­ing the 2010s, once the recruit­ment of seni­or civil ser­vants showed all its lim­it­a­tions in terms of strength­en­ing ties with the polit­ic­al author­it­ies. In 2013, Google obtained a seat on the board of dir­ect­ors of the Parisi­an sec­tion of MEDEF: an anchor­ing in the field of employ­er rep­res­ent­a­tion that reflec­ted the grow­ing influ­ence of the com­pany, and more gen­er­ally of digit­al tech­no­lo­gies, in the eco­nom­ic mod­el of French companies.

The com­pany has there­fore estab­lished itself as a French eco­nom­ic play­er which, through the ser­vices it offers, helps the devel­op­ment of oth­er French com­pan­ies. In addi­tion to becom­ing a “French com­pany”, it has become a cent­ral play­er in the nation­al eco­nom­ic field.

JT. This vital­ness, grant­ing such eco­nom­ic power to these giants, even extends to polit­ic­al com­mu­nic­a­tion. The Aus­trali­an law debate in 2021 is a good example. Aus­tralia wanted Google and Meta to pay the country’s press bet­ter. This pro­voked a stan­doff between the two web giants on the one hand, and the country’s gov­ern­ment on the oth­er. Although this tug-of-war failed to get the bill amended, and it became law the fol­low­ing year, sev­er­al ele­ments emerged from the con­flict. To sig­nal its oppos­i­tion to the ini­tial terms of the bill, Face­book went so far as to block Aus­trali­ans’ access not only to news on its plat­form, but also to gov­ern­ment sites provid­ing sens­it­ive inform­a­tion to Aus­trali­ans (relief, etc.). Essen­tially, the pub­lic author­it­ies depended on this net­work. The res­ult was that min­is­tries found them­selves without com­mu­nic­a­tion chan­nels. In the end, Aus­tralia did pass a law, but only after mak­ing changes that made it more accept­able to Meta and Google.

It is true that anoth­er source of influ­ence, and not an insig­ni­fic­ant one, has to do with research. The total budget for R&D in France, includ­ing both pub­lic and private funds, is €60bn. For the GAFAM, it is $200bn – almost exclus­ively for digit­al tech­no­logy. The vast major­ity of AI research spend­ing today comes from these com­pan­ies, and with this kind of budget, they can also afford to set the dir­ec­tion for future research. This power also implies some­thing else in the research world. A recent Stan­ford report high­lighted that around 70% of PhDs spe­cial­ising in AI end up in the private sec­tor, and only 20% in aca­demia. Ten years earli­er, it was 40% in the private sec­tor and 40% in universities. 

The phe­nomen­on of depend­ence is there­fore likely to recur for future innov­a­tions, such as gen­er­at­ive AI. It is all based on a desire for their eco­nom­ic power to last, to con­tin­ue to grow and to stay ahead of the com­pet­i­tion; the rest is just col­lat­er­al dam­age. And it’s not a ques­tion of nation­al­ity. It’s a safe bet that if a French com­pany had sim­il­ar power, with the same reg­u­la­tions, its object­ives would not be any dif­fer­ent. What needs to be chal­lenged is the busi­ness mod­el of these online plat­forms. In my book, I pro­pose a reg­u­lat­ory mod­el that sim­ul­tan­eously tackles the mar­ket power of the dom­in­ant digit­al play­ers while deal­ing with the prob­lems of con­tent, be it online com­merce or social net­works. This is an essen­tial con­di­tion for regain­ing power. But of course it’s only a pre­con­di­tion for devel­op­ing our own sys­tems – it won’t hap­pen overnight.

In con­clu­sion, and fur­ther to the com­ments of our research­ers, we should men­tion gen­er­at­ive AI, which can be seen as the next major chal­lenge: will we have the capa­city to devel­op our own mod­el, as the Chinese have done with Deep­Seek, or will his­tory simply repeat itself?

Interview by Pablo Andres