Daily Archives: December 16, 2020

As the debate over big tech and antitrust intensified over the past year, certainty reigned.

On one side are those who are certain that companies like Amazon, Apple, Facebook and Google are monopolies, dominant in individual markets like search, social networking, e-commerce and app stores. They are certain that mergers between companies like Facebook and Instagram reduced competition. And theyre certain that antitrust law has calcified, unable to account for new technologies. As a recent report by the House Judiciary Committee claimed, companies that once were scrappy, underdog startupshave become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons.

On the other side of the debate are those who are certain that competition is flourishing in the tech sector, with innovation yielding great products at ever-lower prices, and companies like TikTok and Snap emerging to challenge incumbents. They are certain that mergers have benefited consumers. And theyre certain that we dont need to re-examine antitrust doctrine because its flexible enough to evolve with technology.

In the course of this debate, Ive espoused my own certainties. When I worked for Facebook, it never felt like we could afford to be complacent. We faced real competitive threats. If I had shown up at a meeting and announced that Facebook didnt compete with Google, Apple or TikTok, I would have been laughed out of the room. And I saw Facebooks investment in developing new features for its Instagram and WhatsApp acquisitions and improving the safety, security and infrastructure of both products. So its hard for me to reconcile my experience in the tech sector with the antitrust arguments now being waged against it.

But if Novembers election taught us anything, its that our assumptions are often wrong. With polls predicting a blue-wave election that never materialized, predictions that seemed certain before the election now seem flimsy in the wake of it.

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Big Tech and Antitrust: A Path Forward - The Wall Street Journal

Mr. Lewis said the debate will be a test for the relationship between the United States and European Union, which was strained during the Trump administration on issues like digital taxes. A trade group representing big American tech companies, called the Internet Association, has already complained to officials in Washington about the new European rules.

Veterans of past European debates said the challenge will be translating the laws lofty ambitions into strong enforcement, an area where previous E.U. policies have fallen short.

Europes landmark 2018 online privacy law, called the European Data Protection Regulation, has been criticized for not fulfilling its promise because of lack of enforcement. Despite a limited budget, Ireland is responsible for regulating all tech companies with a European headquarters within its borders including Facebook, Apple and Google and issued only its first fine of a major tech platform on Tuesday with the penalty against Twitter, more than two years after the law was enacted.

For the E.U., it is important to get its priorities right in practice and not just talk about them, said Marietje Schaake, a former member of the European Parliament who now teaches at Stanford University.

The European debate is already turning some companies against one another. On Monday, Facebook issued a statement urging European regulators to act against Apple, part of an ongoing feud between the two companies over Apples App Store policies, which Facebook said harm developers and consumers.

Raegan MacDonald, head of public policy in Brussels for the Mozilla Foundation, which operates the Firefox browser, called the efforts in Europe a once-in-a-generation opportunity, particularly the transparency rules that would provide important insights about how the companies operate.

What this is really about at its core is how people experience the web the misinformation in our feeds, the recommendations that are being pushed toward us, or the creepy ads were seeing and dont know why, she said. If this is done well, this could be game changing regulation for platform accountability.

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Big Fines and Strict Rules Unveiled Against Big Tech in Europe - The New York Times

Executive Vice President Margrethe Vestager talking to media in Brussels, Belgium.

Thierry Monasse | Getty Images News | Getty Images

LONDON Europe is again attempting to position itself as a leader in tech regulation, with a major overhaul of digital rules that some experts say could become a global standard for keeping Big Tech in check.

The EU on Tuesday unveiled its landmark Digital Services and Markets Acts. The measures require tech giants to take more responsibility over illegal content and goods distributed on their platforms, and aim to prevent them from giving preference to their own services over those of rivals.

The package of laws is the biggest shakeup in EU digital policy in decades and is part of a wider fight against the dominance of large U.S. tech companies like Google, Amazon, Facebook and Apple.

Failure to comply with the Digital Markets Act which targets the business models of digital platforms could result in fines as high as 10% of the companies' annual global revenues, similar in scale to fines recently announced by the U.K. as part of new online safety rules.

Companies that repeatedly break the rules could even be forced to divest parts of their business. Global regulators have increasingly been pushing for powers to break up Big Tech.

Raegan Macdonald, head of policy at internet nonprofit Mozilla, said the EU's General Data Protection Regulation privacy reforms introduced in 2018 have already become the blueprint for similar initiatives around the world; California, for example, borrows some elements from GDPR.

"The EU is poised to be a leader in this space," Macdonald told CNBC. "They've done it for the GDPR, for other issues like net neutrality, and they could do it again."

"I would see this more as a start, and many other countries will surely do their own thing or maybe do something similar."

The European Commission has for years tried to take on U.S. internet giants over what it sees as the reduction of competition in Europe.

So far, the EU executive body has fined Google about $10 billion for antitrust violations related to its shopping, mobile and advertising services. This year, the commission also launched two competition probes into Apple and charged Amazon with breaching antitrust rules by using independent sellers' data for its own benefit.

The bloc's latest move aims to block what the EU calls digital gatekeepers from using their market power to lessen competition, essentially expanding on its efforts to rein in Big Tech over the last few years.

The Digital Markets Act "will recalibrate what digital platforms can and can't do in Europe," said Bernd Meyring, a European competition lawyer at Linklaters.

"Leaving aside eye-catching powers for the commission to break up digital giants in the case of systematic noncompliance, the wide-ranging obligations covering interoperability of digital services, access to platform data and a prohibition on preferencing their own related services will have significant effects on digital platforms' business models."

However, not everyone is happy with Europe's digital reforms especially not the tech companies it's most likely to affect. Google, for example, has lobbied hard against the rules and says it's concerned the EU is targeting "a handful of companies."

And while some critics say the EU may be going too far with its approach, others worry it doesn't go far enough.

"The EU has generally fallen short of the mark when it comes to enforcing its own rulings," said Sophie Dembinski, head of public policy at Ecosia. The alternative search engine is calling on Brussels to revisit a landmark antitrust case against Google regarding its Android smartphone system.

"While the DMA is certainly a regulation that we can support, what will be most impactful in the immediate term is a concerted effort on the part of the EU to enforce the decisions already in place."

And it's going to take some time before the EU's digital reforms actually take effect. The new rules need to be approved by member states and the European Parliament before being adopted. European competition chief Margrethe Vestager has said they could be fully active in two years.

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Europe tries to set the global narrative on regulating Big Tech - CNBC

On Tuesday, European Union officials led by Ms. Vestager will introduce some of the worlds most far-reaching technology regulations. The rules take aim at so-called gatekeeper platforms, like Amazon, Apple, Facebook and Google, which have an outsize role in the digital economy.

Among the expected changes are rules for Facebook, Twitter and YouTube, which is owned by Google, about moderating user-generated content. Other requirements would make companies disclose more about how services like Googles and Facebooks digital advertising products worked. The largest companies could be forced to share some data with small rivals. Stiffer competition rules could prevent the companies from giving their services preferential treatment over small rivals, and limit their ability to move into new product categories.

There is a lot to lose for the tech industry with the new legislation, Mr. Bank of LobbyControl said.

The laws are not expected to be approved before 2022, giving the companies ample time to influence the debate.

In October, the leaked document showed how Google tried to influence the European debate before a draft was even introduced. It included plans to enlist U.S. officials from embassies across Europe and in the Office of the United States Trade Representative. It suggested talking points for Google supporters, such as the risk to the economy during the pandemic.

After details of the document were published by Le Point, a French magazine, many European officials expressed outrage and resolved to press ahead with the new laws. In a meeting after the leak, Sundar Pichai, Googles chief executive officer, apologized to Thierry Breton, a European commissioner helping to draft the new rules.

Yet Google and its allies appeared to be moving forward with ideas in the plan nonetheless. In Washington, the Internet Association, a trade group representing Google and other tech giants, submitted comments to the U.S. trade representative, encouraging the federal government to act decisively and quickly in order to prevent the rapid expansion of harmful initiatives in Europe.

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Big Tech Turns Its Lobbyists Loose on Europe, Alarming Regulators - The New York Times

Heres todays AdExchanger.com news round-up Want it by email? Sign uphere.

Optimism And Concern

A half full glass is also half empty. The IABs newly released market outlook report for 2021 is both optimistic about digital advertising in the year ahead and concerned about the loss of identifiers and how the industry will prepare for a cookieless future. Media buyers pointed to data privacy and ad tracking as their top challenges for 2021, with 41% saying they arent sure if their stakeholders have a clear enough understanding of the implications of what it means to lose third-party cookies. More than one- third of buyers believe that they need more first-party data. Media budgets are expected to be flexible in 2021, with 39% of buyers reporting that they only have ballpark budgets set for the year to come. Overall, buyers expect a 6% overall increase in their 2021 budgets over 2020, with traditional media budgets set to drop by 5% and digital media expected to account for 71% of total budgets next year (a 14% increase from 2020). Twenty-one percent of buyers will reallocate their linear TV budgets to CTV, which they see as more targeted, efficient and scalable. In other IAB news, the IAB Tech Lab released an update to its Ads.txt and App.ads.txt specs to address transparency and fraud for CTV and OTT inventory, kicking off a 30-day comment period that will last until Jan. 14.

Big Techs Olive Branch?

Numerous tech leaders have said in recent weeks that they are open to changes to Section 230 of the Communications Decency Act, The New York Times reports. The law, passed in 1996, limits the platforms legal exposure to material posted by users. But it has come under serious bi-partisan fire in recent months, and a phalanx of tech CEOs are falling in line. Facebooks Mark Zuckerberg has said Section 230 should be updated, and Twitters Jack Dorsey has proposed possible expansions. Google has acknowledged legitimate questions about the law. On Tuesday, a group of smaller companies Snap, Reddit and Tripadvisor among them will announce that they, too, are open to reforms. A lot of this is these companies understanding that change is coming one way or another, said Mary Anne Franks, a professor at the University of Miami School of Law. And one of the best ways to keep your interests in the center is to acknowledge that change is coming and try to shape it.

Hand It Over!

In other regulatory news, the Federal Trade Commission has ordered nine prominent social and internet companies to provide a litany of data about their operations as part of a wide-ranging study into their business practices, The Wall Street Journal reports. The orders demand the companies turn over detailed, private business information about how they track Americans online activities and how they use that data. Companies receiving letters included Amazon, Facebook and subsidiary WhatsApp, Reddit, Snap, Twitter, YouTube and TikTok owner ByteDance. The announcement isnt a law-enforcement action and doesnt carry any immediate penalties, though the information gathered could form the basis for future action by the FTC.

But Wait, Theres More!

Youre Hired!

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Media Buyers Cite Data And Privacy As Top Challenges; Big Tech Is Open To Updating Section 230 - AdExchanger

The Week

While looking at Florida's COVID-19 death tally, the South Florida Sun Sentinel found a pattern suggesting the state "manipulated a backlog of unrecorded fatalities" so the daily death numbers were artificially low ahead of the November presidential election, the newspaper reported Tuesday.There is a lag between the date a person dies of COVID-19 in Florida and the date the state reports the death as part of the public count. The Sun Sentinel found that with just a few exceptions, starting on Oct. 24, Florida stopped including deaths that occurred more than a month earlier in daily counts. It wasn't until Nov. 17, two weeks after the election, that these backlogged deaths were consistently included in the daily tally.These deaths have "long formed a significant part of the daily totals in Florida" because it can take some time for death reports to make it from a doctor's office to the health department, the Sun Sentinel reports. For example, from Sept. 23 to Oct. 20, the state included in its daily tallies 1,128 deaths that took place at least one month earlier. This accounted for 44 percent of the deaths that were announced over those four weeks.On Oct. 21, the state said it would start conducting additional reviews of each suspected COVID-19 death in Florida before adding it to the official count. Florida Gov. Ron DeSantis (R), a supporter of President Trump, has a history of downplaying the coronavirus pandemic, and the Sun Sentinel reports he has also speculated that the death statistics in the state were inflated. The Sun Sentinel said it asked several state officials about the data patterns, including the spokesman for the Florida Department of Health, and no one would comment.Scott David Herr, a Florida computer scientist who tracks the state's daily COVID-19 data, told the Sun Sentinel "it's hard to know if there was a limitation around election time or random other things were happening. The Department of Health hasn't explained why lags have been inconsistent. When they keep changing whatever is going on behind the scenes, when the lags keep changing, that is where it gets confusing." Read more at the Sun Sentinel.More stories from theweek.com Joe Biden still doesn't get it Republicans' hedonic treadmill problem The plan to disinfect the White House before Biden moves in is a 'huge waste of time and effort,' experts say

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Big Tech rooted out information that could have affected presidential election result: Kayleigh McEnany - Yahoo News

Some small entities mirror Big Tech and foreign entities comments arguing that PTAB institution rules should not change at all. To the casual observer it is certainly confusing. But to those who have tried to launch a tech company in a market saturated by a handful of huge Big Tech monopolies, it is easy to understand.

Historically, startups bring more new technologies to market and create more new jobs than any other entity type. Investment is critical to any startup, and patents are often the only asset a startup owns to attract that investment. Patents are thus incredibly important for American economic growth and national security.

To risk investing in a startup, early stage investors must believe that their patents will keep big competitors at bay long enough for the startup to get a toehold in the market. If big competitors steal the technology anyway, the investor must believe that defending a patent is reasonable in cost and effort, and the outcome is predictable. Otherwise, investors will put their money elsewhere, thereby starving early stage startups of capital and limiting competition, slowing innovation, and fueling monopolization by incumbents.

For the first 220 years of American innovation, patents easily attracted investment. Based largely on patents, Edison built what became GE, Bell built a telephone company and Google built their search engine. Edison even sold rights to future patents that he had not yet invented.

While patents are critical to early stage investment, business models (sometimes called business methods) are also key to driving innovation. In the 1980s, a startup named Compaq outdid IBM for the PC by driving down prices. Then selling online, Dell outdid Compaq, Micron, Gateway, Apple and many other PC makers. Microsoft outdid all operating systems, becoming a monopolistic juggernaut, and then leveraged their monopoly to steal the market for web browsers, video players and many other technologies. In the 2000s, a startup named Google outdid Microsoft, Motorola, and many others, capturing the phone operating system market by leveraging the market power of their search engine. Only Apple survived the Android onslaught.

In American innovation, startups proliferate around a new technology or business models to challenge incumbents. The proliferation of startups proliferates a multitude of variations. As the market establishes, it consolidates into a few major players through mergers, acquisitions and weak player deaths. This competition in a free market spurs tremendous innovation.

However, in the last 15 years, there have been few, if any, challengers to Big Tech monopolies.

This damage to American innovation was levied by Big Tech lobbying that weakened patent rights for small competitors, raised taxes on small entities while lowering their own taxes, created laws to shield them from lawsuits, and much more. The result is that Big Tech has captured and privatized huge markets. These markets are magnitudes larger than any markets in history. Big Tech now crushes competition by leveraging these markets against small entrants. They are now monopolies yielding enormous power.

Like a sovereign nation, Big Tech has assumed sovereign power over these markets, including restricting access and forming their own quasi patent systems. Anyone wishing to participate does so at the pleasure of Big Tech. This is enormous leverage over the small entities who rely completely on Big Tech market access for their businesses. If they offend the pleasure of Big Tech, they lose access and lose their business.

Patents were once a bulwark against Big Tech monopolization, but a trifecta of significant changes to patent law allowed Big Tech to capture huge markets perpetuating their monopolies, and enabling them to take sovereign control over these markets.

The trifecta began in 2006 with eBay v. MercExchange, which eliminated injunctive relief. That means if your technology is stolen by Big Tech, or even a phone app on a Big Tech market, you cannot stop them. This insulates Big Tech and those on their markets from the U.S. patent system. Investors know it, so most will not invest in startups competing directly with Big Tech or one of their market participants.

Then in 2013 and 2014, the trifecta was completed with the double whammy of the America Invents Acts creation of the Patent Trial and Appeal Board (PTAB), which kills 84% of the patents it reviews; and the Supreme Courts radical interpretation of the word any in Section 101 to have an undefined exception called the abstract idea, which now kills over 65% of challenged patents.

This trifecta destroyed patent protection for virtually all tech inventions in the hands of a startup. You cant stop an infringer and if you try, your patent will be invalidated, and you will pay millions for the privilege to try.

Today, patent litigation is a game of big numbers and big money. Only huge patent portfolios owned by very rich entities and corporations can be enforced, while a patent in the hands of a startup is a liability. This has killed tech startups in the cradle by encouraging rampant infringement.

With no startups challenging Big Tech for their core technologies (who also have the advantage of enforcing their own patents), Big Tech monopolized.

USPTO Director Iancu appears to understand the inequity posed by Big Tech monopolies and has taken steps to correct what he can. First, he established new USPTO guidance attempting to define the undefinable abstract idea under Section 101.

And recently, the USPTO requested comments on the rules that guide the decision to institute a PTAB procedure.

If the abstract idea is defined and PTAB institution rates are reduced, there will be fewer invalidated patents. This would help stabilize the patent system and thereby improve investment in early stage startups with technologies that challenge the dominance of Big Tech. In the end, Big Techs hold on their captured markets and their monopolies would be broken. America would once again have free markets and tech innovation would increase.

In the comments on PTAB institution rules, it is understandable that Big Tech (here, here, here) and foreign entities (here, here) promote high PTAB institution rates including multiple attacks. After all, high PTAB institution rates mean more invalidated patents. While high PTAB institution rates significantly harm American innovation, it helps Big Tech and foreign entities.

It is not surprising that most small entities believe that the institution rules are unfair and should be reined in because it denies due process and takes property; they allow unending serial attacks; they deny adjudication in an Article III court even when the case is pending; they prohibitively raise costs and years to patent litigation; the PTAB invalidates 84% of the patents it reviews; and in the end, the rules make it difficult, if not impossible, to fund a startup that challenges Big Tech.

What is surprising is that not all small entities agree. Some small entities mirror Big Tech and foreign entities comments arguing that institution rules should not change at all. They want the mess to stay the same.

To the casual observer it is certainly confusing. But to those who have tried to launch a tech company in a market saturated by a handful of huge Big Tech monopolies, it is easy to understand.

The key to understanding this contradiction is in the business models. The operating environment of the market is, for many, completely controlled by Big Tech. Big Tech monopolies restrict access to their huge markets and protect those on the markets using a quasi-patent system. One advantage is that small entities selling on these markets do not need the U.S. patent system they get one from Big Tech. Neither Big Tech nor the phone app companies find the U.S. patent system useful. In fact, it is a threat to their business models.

When you read the comments to the USPTO request for comments, almost uniformly, the small entities that argue to keep institution rates high are phone app companies or companies that leverage Big Tech markets in some other way to sell their products. They do the bidding of Big Tech in most cases willingly because they benefit from it in the operating environment created by Big Tech.

However, certainly there are those who disagree with the party line. But they cant say it publicly because if they step out of line, Big Tech can remove them from their markets, which means the death of their company. Even if Big Tech does not explicitly threaten these companies, it is certainly implied. Many companies have been ejected from Big Tech markets for reasons unknown because they are hidden behind nondisclosure agreements signed to join a market and enforced when the company is removed.

Those who commented in the USPTO request for comments to limit PTAB institution decisions largely do not participate in Big Tech markets. Many do not have tech products and others have technologies that compete with Big Tech core technologies.

The USPTO and Congress must seek to understand how the different business models perceive the value of the U.S. patent system and why this forms their contradictory opinions.

The USPTO and Congress must decide what is best for America is it better for American innovation to encourage quasi-sovereign Big Tech monopolies with absolute control over the largest markets ever created? Or is it better to recreate free markets that are accessible by anyone without control by Big Tech monopolies?

America needs the latter, which is easily accomplished by reversing the trifecta that destroyed the patent system for small entities. Patents would once again earn injunctive relief and would not be easy to invalidate nor prohibitively costly to defend. Small entities could challenge Big Tech in a free market and break up their monopolies. American innovation would again rule the world.

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Some Small Entities Agree with Big Tech on PTAB Institution Rules: Congress Must Address Why - IPWatchdog.com

THE CHANGING FORTUNES OF THE WORLDS RICHEST

S

hares of big tech companies havebeen driving the surge in the stock marketduring the pandemic. But this week heavyweightsAmazon, Google and Facebook took a hit when faced with the prospect of increased regulatory scrutiny. Big tech stocksand their founders fortunesfell after two separate antitrust lawsuits were announced against Facebook this week.

Amazon CEO Jeff Bezos, Facebook CEO Mark Zuckerberg and Googles two cofoundersLarry Page and Sergey Brinare a combined $8.5 billion poorer in the week through Friday, December 11.

The Federal Trade Commission on Wednesday announced that it would sue Facebook for illegal monopolization, calling for the company to unwind its acquisitions of WhatsApp and Instagram. That same day, New York Attorney General Letitia James announced a separate antitrust lawsuit against the social media giantjoined by 47 other state and regional attorneys generalon similar grounds. Facebooks stock dropped 3.5% since the lawsuits were announced.

The Dow Jones Industrial Average and S&P 500 posted their first weekly declines in three weeks, falling 0.6% and 1%, respectively, while the tech-heavy Nasdaq Composite index dropped 0.7%. Shares of major tech companies, however, fell by more: For the week, Facebook was down 2.2%, Amazon lost 1.5% and Google-parent Alphabet declined 2.7%.

Amazon CEO Jeff Bezos, the worlds richest man, saw his fortune shrink $2.4 billion this week to $182.2 billion, Forbes calculates. Facebook CEO Mark Zuckerberg, meanwhile, was down$2.2 billion since last week; hes now worth $100.5 billion. Google cofounders Larry Page and Sergey Brin also took a hit, with their net worths dropping by $2 billion and $1.9 billion, respectively. Page is now worth $78.2 billion and Brin is worth $76 billion, according to Forbes.

Despite techs drop, the billionaire whose fortune fell the most in dollar terms over the past week was Spains Amancio Ortega, the worlds wealthiest clothing retailer. In 1975, he cofounded Inditex, known for its Zara fashion chain, shares of which dropped 3.7% this week. He now has a net worth of $74.4 billion$3.1 billion less than last week.

Other notable billionaires who saw their fortune take a hit this week include famed investor Warren Buffett and Sheldon Adelson, CEO and chairman of Las Vegas Sands. Shares of Buffetts investing conglomerate, Berkshire Hathaway, dropped 2% since last week, shaving $1.8 billion off of his net worth, which now sits at $85.5 billion. Adelson, meanwhile, saw his fortune drop by $1.5 billion, to $35.1 billion, after shares of Las Vegas Sands fell by 5.2% this week.

The net worth change is from close of markets Friday, December 4 to Friday, December 11.

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Tech Founders Lost Nearly $9 Billion This Week As Big Tech Faces Increased Regulatory Scrutiny - Forbes

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Tech stocks got crushed Wednesday, ending a 10-day winning streak for the Nasdaq 100. The mere fact that it had such a long streak of gains, however, could indicate a rebound is on its way.

The Nasdaq 100the 100 largest components of the tech-heavy Nasdaq Composite went on a 10-day winning streak between Nov. 24 and Dec. 8. Most of the indexs components are large-cap tech stocks, which are typically classified as growth stocksthat is, they have drivers of high revenue growth that arent fully correlated to macro economic conditions.

The indexs top 10 holdings include Apple (AAPL), Amazon.com (AMZN), Facebook (FB), PayPal Holdings (PYPL), and Nvidia (NVDA). The Nasdaq 100 dropped 2.2% on Wednesday after gaining 5.3% during the winning streak, bucking a recent trend of value stocks leading the market.

The Vanguard S&P 500 Value exchange-traded fund (VOOV) rose just 3.2% in the 10-day period, a snapback from a broader move into value stocks beginning in September. Investors tend to buy value stocks when the economic outlook brightens.

This bodes well for tech stocks in 2021, even if value stocks run hot at the same time.

There have been just 15 instances in the history of the Nasdaq 100 when the index experienced a 10-day winning streak, going back to 1985. The longest was 13 days in 1992. The average gain for the next year after these streaks, on average, has been 19%, according to research from Bespoke Investment Group.

Thats a strong gainthe long-term average for annual gains in the S&P 500 is about 8%, dating back to 1957. And it isnt as if those average gains for the Nasdaq 100 are weighted toward just a few explosive years; the index has seen gains over about 85% of all one-year periods after such a winning streak. There have been seven times when the one-year gain was above 20%.

Twice after such a streak, the Nasdaq 100 entered a correctiona downdraft of 10% of more. Those corrections were in 2010, during the May flash crash and in 2014 during the Ebola scare, according to data from Instinet.

On a fundamental basis, many on Wall Street still like Big Tech. Earnings for the FAAMG groupFacebook, Apple, Amazon, Microsoft (MSFT), and Google parent Alphabet (GOOGL)are projected to grow in the midteens in percentage terms to 30% in 2021, and valuations have started to come back down to earth. Apple and Amazon are still 9% and 12% below their all-time highs, respectively, hit in early September.

Write to Jacob Sonenshine at jacob.sonenshine@barrons.com

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Big Tech Stocks Just Had a Big Winning Streak. That Usually Means Theyre a Buy. - Barron's

First, we live in a world that is a lot more G-Zero now than just twelve months ago.

A G-Zero world is one in which the G7, G20, and G-everything else gives way to a more broadly fragmented global power structure with no leadership compass. Faced with a once-in-a-generation crisis in 2020, global cooperation was almost entirely absent, with most countries dealing with the common COVID enemy on their own (as Trump did by walking away from the World Health Organization).

The crisis did, however, spur unprecedented progress in the vaccine race, and forced a rare consensus within the European Union on a rescue package for the bloc's economic recovery.

In a global power vacuum, China saw an opening to make its move on Hong Kong, where democracy is now officially over. China also clashed with India over their Himalayan border, and the US-China rivalry heated up with tussles over the South China Sea and Taiwan.

Second, the pandemic exposed deep fissures in our societies.

Crises always do, but COVID-19 had a disproportionate impact on the poor, minorities, and women in the US and other countries. When the George Floyd protests went global, we looked into the broader r issue of policing in America, and racial equality around the world.

The pandemic also revealed the fragility of the US economy, took an enormous toll on mental health, and cast a light on widening inequality which multilateralism is struggling to address (along with climate change) as the United Nations turned 75.

Third, the US election turned out to be every bit as contentious and contested as we expected.

As the Joe Biden campaign gathered momentum, we predicted what his foreign policy would look like, and discussed how to hold a safe election with a surge in mail-in voting amid a pandemic. We later analyzed how taking office will be no walk in the park for Biden, whose administration's future success in part depends on the result of a January runoff election in Georgia for control of the US Senate.

Even as individual states certified the results, Trump still refused to concede, and his efforts to question the legitimacy of the vote will reverberate for years to come. Biden inherits a deeply divided country.

Looking ahead: The good news is that 2020 is almost over, and we are ending it on a (cautiously) optimistic note with vaccine rollouts in a host of countries, and continuing hopes that the Brexit saga ends with a trade deal. But the pandemic won't be over anytime soon, and just as no one saw COVID coming one year ago, 2021 will surely bring this G-Zero world a few challenges that no one will have foreseen.

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What Were Watching: US hits Turkey, EU stands up to Big Tech, Xinjiangs cotton-picking forced labor - GZERO Media