Elizabeth Warren says break up the tech giants: Well, they tried that with GM

Zuckerberg and Bezos need not worry, if past is prologue

Presidential candidate Sen. Elizabeth Warren's plan for breaking up tech giants including Facebook, Google and Amazon may be causing a bit of consternation among the denizens of Silicon Valley. But once upon a time there were similar calls for an industry behemoth to be brought down to size: General Motors.

If past is prologue, the tech giants need not worry about Warren's proposal, because by the time something happens, they will have morphed into something else.

Consider DuPont and General Motors. In 1914, Pierre S. du Pont, scion of the chemical company, bought GM stock. GM's fortunes improved in the pre-war years, and du Pont was put on the board of GM in 1915.
Before the decade was out, the DuPont company invested more in GM, which found itself in some financial problems under William C. Durant. In 1920, du Pont was named president of the automaker, presumably a quid pro quo, a position that he held until 1923, when he was named chairman. (He was replaced as president by Alfred P. Sloan.)

Realize that DuPont had all manner of products for automaking, including paint, textiles and gasoline additives, and the existence and prosperity of GM was immensely important to DuPont. GM grew and DuPont benefited quite handily.

But it wasn't until 1949 (remember, there was another world war in the meantime, which GM was instrumental in helping to win) that the Justice Department filed a suit against DuPont under the 1890 Sherman Antitrust Act. Five years later, a federal district court judge threw out the case, but the Justice Department appealed to the Supreme Court, which ruled in 1957 against DuPont (under the Clayton Act), finding that the effect of ownership by DuPont was causing monopolistic conditions.

In 1961 DuPont divested itself of GM stock. Which apparently didn't have a negative effect on GM as in 1962, according to Knoema Corp., the company's market share was 50.72 percent.

Meanwhile, in 1956 the Justice Department under the Eisenhower administration began looking into GM because of that huge slice of the automobile market. But by 1967, the Justice Department threw in the towel, even though GM's market share that year, according to Knoema Corp., was still 48.93 percent — thought it has been downhill since then.

All that's to say that the wheels of justice grind slowly. The DuPont-GM case went eight years, and the subsequent DOJ inquiry took 11.

That's nearly a generation of litigation and investigation. And in the tech world? That's several lifetimes.

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