Big Tech is using consumers like a voodoo doll: Roger McNamee

With both the Trump Administration and the House Judiciary Committee on the verge of investigating several Big Tech firms for potential antitrust violations, a technology investing pioneer said it’s time for the government to act.

Roger McNamee, the co-founder of both the private equity firm Silver Lake Partners and the venture capital firm Elevation Partners, tells Gerry Baker on “WSJ at Large” that he believes companies such as Facebook and Alphabet's Google are now a danger.

“They build these digital voodoo dolls about each and every one of us,” he argued.  “And they’re now using that to do things that are genuinely harmful to consumers and increasingly destructive to the fabric of the economy.”

McNamee was an early investor in Facebook but has written a critical book about the company entitled “Zucked. Waking Up to the Facebook Catastrophe.” He feels the social media giant, along with firms such as Google, Amazon, and Microsoft, are fooling us into believing we’re getting something for almost nothing.

“We think we’re giving these platforms a little bit of data for a valuable service,” he said.  “But what’s really going on is that they’re gathering massive amounts of data in other places, you know, by buying it from banks, buying it from credit card processors, or cellular companies or other websites.  They track us everywhere we go on the web.  They have new surveillance products like Alexa and Google Assistant.”

He’s especially concerned about the power of Google and its dominant search engine.

“What information do you get?  Only the stuff that Google gives you which means Google uses search results to steer consumers to outcomes that are favorable to Google,” he pointed out.

“And the reason why this is a problem is that in capitalism we have uncertainty on both sides, you can't have equilibrium if one side has perfect information and the other side only has the information that the side with perfect information gives them.“

Reports indicate the Department of Justice is looking into both Google and Apple, while the Federal Trade Commission is investigating Facebook and Amazon. The House Antitrust, Commercial and Administrative Law subcommittee is taking a broader look at the entire sector. The Wall Street Journal reports attorney generals in perhaps as many as 20 states are preparing to do their own probes as well.

House Subcommittee Chairman David N. Cicilline, D-R.I., saying: “After four decades of weak antitrust enforcement and judicial hostility to antitrust cases, it is critical that Congress step in to determine whether existing laws are adequate to tackle abusive conduct by platform gatekeepers or whether we need new legislation to respond to this challenge.”

Generally, the companies have been mum about the probes, although Apple CEO Tim Cook told CBS News his firm is not a monopoly.

“I don’t think so,” he said. “But with size, I think scrutiny is fair. I think we should be scrutinized. But if you look at…any kind of measure about is Apple a monopoly or not, I don’t think anybody reasonable is going to come to the conclusion that Apple’s a monopoly.”

So if something does need to be done to rein in Big Tech, what might that look like?


McNamee would like to see the government’s breakup of AT&T in the 1980s used as the model. That would include allowing new companies to form by having access to Big Tech companies’ platforms, in the same way new firms got access to AT&T’s long distance lines of the past.

And one other thing.

“Ban the commerce in people's consumer data,” he insisted.  “No commerce in third party data.”