Big Tech Is in Crisis. That’s Exactly What It Needed.


Joshua Browder, a 26-year-old entrepreneur from the United Kingdom, recently raised his flagship product in a way that he could not have imagined a few years ago.

His startup company DoNotPay spent several years developing a chatbot that could negotiate erroneous or excessive fines and fees on behalf of consumers — think unauthorized parking tickets — building a database of expertise based on the history of human interactions.

The bot often required manual intervention, but in December it made progress. The bot “talked” to Comcast’s online customer service and managed to save $120 on their broadband bill. He said this was the first time AI had negotiated a single such bill.

How? Earlier that year Browder gained access to GPT-3, a large and powerful language model created by the artificial intelligence company OpenAI. The system understands language better than almost any software before it, and human sounds when it responds. Browder is now planning an AI lawyer that will be able to whisper instructions to people through their headphones when they are in traffic court.

Browder’s startup, which was valued at $210 million last year, is one of many new services being quickly built on top of AI generation tools with names like GPT-3 and DALL-E. Other services promise to draft emails, stimulate new markets or even replace Google search. They are coming at a time of wider changes in technology, when a combination of market and regulatory pressures could make the industry more productive than it has been in years.

Big Tech’s business models, which until recently generated more than $1 trillion in revenue each year, are under pressure. The advertising duopoly of Google and Facebook is moving into a market where Inc. and Apple could be a big threat now. A tough new antitrust law on the horizon from Europe is already forcing changes at Amazon and Apple to make life easier for their much smaller rivals.

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The combination of these circumstances may evoke a familiar feeling for those who have worked in technology for a long time. The layoffs and share prices have marked the last painful year before, and are usually followed by an uptick in fortunes. Booms and busts are part of the history of technology, and even amid the turmoil​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​ you is to Twitter and the world of crypto, there is good reason to expect that 2023 will be the beginning of the next boom high-tech, AI-driven and more efficient. working class.

For years, tech workers have held the upper hand in the industry’s labor market, commanding high salaries and expensive perks and pushing tech giants to the point of bloat. Meta has hired a staggering 30,000 people during the pandemic, leading to Mark Zuckerberg cutting 11,000 jobs in November. Stripe, Snap and Amazon recently made similar cuts, and Musk whittled Twitter’s staff down to about 2,000 from 7,500 in less than six weeks. About 150,000 tech workers will lose their jobs in 2022, according to, which tracks industry cutbacks. Those left behind are told to work harder and with “greater urgency,” or come to the office more often than before.

The painful shake-up was necessary. In the last five to 10 years, the technology industry has offered some valuable and innovative services as it has grown fat on old business models. Our most important computing device is a rectangular metal slab made by Apple or Samsung Electronics Co. Google is so afraid of disrupting its most important source of revenue – advertising – that it has barely changed search, while Amazon’s AWS is still printing money as the world’s source of revenue. largest cloud provider. Meta, at least, has attempted a radical venture into virtual reality. But for the most part, the industry and its biggest players have not been very innovative.

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They also acted like a giant squid pulling up all the talent in the sector, to the detriment of start-ups. It was almost impossible for a new company to compete for senior engineers when a payments giant like Stripe Inc. offered. more than $450,000 a year for the position. Do you want to supervise a lead engineer on a new product line? Too bad, because Facebook paid close to $1 million a year for the role, according to, a website that tracks the salaries of engineers in Silicon Valley.

Venture capital funding for low-margin startups — think businesses that offer food delivery services and telemedicine instead of software — is on the decline after years of overreacting to business ideas that should never have been funded. VC investors say they are flocking to firms that build software and now offer higher margins.

The combined effect: Tech startups that are cash-rich enough to survive two or more years without fundraising are able to poach the best engineers and product managers, as my Bloomberg Opinion colleague Tim Culpan recently pointed out . In other words, instead of talent being wasted on a wide variety of businesses that won’t go anywhere, it’s going to well-structured businesses and putting it to good use.

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One more factor will help move things along: a huge government bounty. In the early 1990s, when the internet was still called the “information superhighway”, the US passed the High Performance Computing Act to help build out the country’s online infrastructure. He played a key role in sustaining the early growth of the web. Part of his $600 million went to the University of Illinois, where a team of developers created the first graphical web browser called Mosaic.

Now some tech firms are in a position to benefit from a much larger investment, $52.7 billion, in US semiconductor research after President Joe Biden signed the CHIPS and Science Act into law in August. That could directly benefit a range of AI services that rely on faster and more sophisticated computing from chips.

For once, technology is putting its feet against the fire. After years of stagnant growth and cushy benefits, this may be the only way for the industry to get back to innovating and creating more space for others.

More from Bloomberg Opinion:

• Why The Future Of Technology Is As High As Predictions: Faye Flam

• Eyeing the Gold Rush to Be the New Twitter: Tim Culpan

• Science Twitter Needs a New Home: Lisa Jarvis

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Parmy Olson is a Bloomberg Opinion columnist covering technology. A former reporter for the Wall Street Journal and Forbes, she is the author of “We Are Anonymous.”

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