Why Facebook isn’t a Technology Company

Believe it or not at the close of the trading this last Monday, the top 5 global companies in terms of their market capitalization were all U.S. tech companies. Not surprisingly they were in this order: Apple at number one, Alphabet(google) coming in at number 2, Microsoft in a respectable number 3 spot, Amazon coming in at 4, and finally in the number 5 sport was Facebook.

Bloomberg, which reported on this apparent milestone insisted that this “tech sweep” is unprecedented, not even during the dot-com boom did anything close to this happen. Back in 2011 however, we can remember when the Exxon and Shell held the 2 top spots was the last time anything kind of similar happened so that should give you some perspective.

However, if we look a bit deeper at what Facebook is, and the service they provide is peculiar to call them a technology company as such. But to deny that moniker to firms that make diesel trains, oil drilling platforms, vital infrastructure and engineering designs seems a bit odd.

Consider that part of the problem in this regard has to do with the private language that we use when it comes to business and more importantly finance. Because think about it what technology has Facebook put out that has ever been ground breaking in and of itself, and how can it be said that they are even capable to doing so. They really can’t nor are they in a position to ever make mores in this regard. Why should they, as long as they keep the lights on and maintain a website that is great in spite of their direct influence not because of it, people will continue to beat down the doors to throw money at them and jam it down their throats.

Consider a company like Microsoft for example. Microsoft very easily and neatly fits into their square definition of what it is to be a technology company, given their development of things like technology and software and computer services. Almost the entirely of Google’s and Facebook’s money is generated from their advertising. In Facebook’s case it is more than 95 percent on most days. By that metric it is ease to see that there is in fact an argument that those firms are really media industry companies with a focus on broadcasting and entertainment. In the case of Alphabet though it is a lot like GE or in a lot of ways it aspires to be, with its investments in automotive self driving cars as well as health care, and in more than one case they try to do the whole utilities thing. Now When we look at what Facebook is doing in regards to other plays there simply aren’t any. Facebook has never created an original idea, they just branded and marketed the hell out of old ones. So to say that they are a tech company is confused from the onset if the only qualification to be one is that you take advantage of the technological developments of your time. If that were the case every company would fall under this umbrella.

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