More than two years into Pandemic Times, technology is more popular, stronger and richer than it was before. Or is it?
This year — and particularly the past few weeks — has complicated what was a fairly straightforward understanding of how most of the tech industry and America’s superstar digital companies were faring.
Repeatedly over the past year or so, my colleagues and I have written that tech was the unquestioned winner of the oddball pandemic economy. People and businesses needed what tech companies were selling, and that increased reliance made tech stars grow faster and become far more profitable than Silicon Valley nerds could have imagined. Bonkers dollars. A+.
Now I think that grade should be revised to an incomplete. Some of the trends of 2020 and 2021 — including more work, shopping, product marketing, entertainment and socializing shifting online — have started to backslide. With hindsight, it’s unclear now how much of the digital surge of those years was a blip and how much was an acceleration of lasting tech transformations.
That uncertainty, along with inflation and weakening economies, makes it tough to figure out what is happening in tech today or even assess the past couple of years. We may be on the cusp of a great time for tech or the beginning of a rough patch for their products and finances. Let me repeat what should be the mantra of 2022: No one knows anything.
Some tech executives are mostly exuding confidence about their futures, while others are oozing anxiety sweat. It’s almost as if they live in two separate realities. And maybe they do.
In one realm is the land of Big Tech, with emperors like Microsoft, Google, Amazon (maybe), Apple (maybe) and a few others in fortresses looking down on us pipsqueaks.
Revenue at Google and Microsoft continued to go up from what seemed to be their unsustainably huge sales of digital advertising and software in 2021. Both companies this week said they felt good about their prospects but also warned of troubles ahead.
On Tuesday, Google executives said the word “uncertainty” or a variation of it 13 times in a conference call with investors. The company said it would start to be obvious in 2023 that Google is slowing hiring. Planning a spending diet so many months in advance is a sign that the company doesn’t expect to breeze past what might be a recession in the United States and other global problems.
Several winners of the pandemic’s scariest phase are also struggling, calling into question whether their heady days of 2020 were partly a mirage.
Netflix has lost subscribers in the United States and Canada for two quarters. That has made some experts doubt whether online streaming overall can grow as large, as fast and as lucrative as optimists believed. Snap, which owns the Snapchat app, saw its fortunes and usage soar in 2020 before reverting to what it was before: A not-very-successful company with an uncertain future.
Shopify, whose software helps in-person businesses set up online storefronts, said this week that it believed the pandemic had no lasting effect on people shifting from in-person shopping to the internet. If Shopify is right, the whole idea that the pandemic turbocharged a change in shopping habits will implode. It will have been a temporary sugar high.
Amazon has not been quite so direct, but the company has acknowledged that it overestimated how quickly e-commerce sales would grow and is slashing some spending. (Amazon and Apple disclose quarterly financial results later on Thursday.)
And Meta… phew. I’m not sure I’ve ever seen a company switch so quickly from swagger to a bumbling Mr. Magoo.
The company’s revenue has fallen for the first time, and its Instagram app is having an identity crisis. But I can’t say if this is the beginning of the end of Meta as a dominant digital power or a temporary lull owing to a combination of inflation, privacy changes made by Apple, and ugliness compared with the pandemic-related upswings in ad sales and profits it once reported. Meta’s yearly revenue is nearly double what it was at this point in 2019. That is not a sign (yet) of a company in permanent decline.
With the United States and other big economies growing weaker, it’s possible that digital superstars will use this moment of uncertainty to muscle into new areas and extend their dominance. It’s also possible that even giants can’t stay strong if their lucrative markets, which include premium smartphones, online advertising, e-commerce and corporate software, grow more slowly in the next few years or shrink.
Is tech winning or not? Can I take a long vacation and revisit this question in 2023?
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Tip of the Week
Handy changes for your gadgets
Brian X. Chen, the consumer technology columnist for The New York Times, published a useful list of standard settings that we should change for iPhones, the Facebook app and other technologies to pare back the data we share with digital companies. Brian is here with more of his favorite settings tweaks to make our devices more fun (or less annoying):
Maximize the video resolution on an iPhone: On iPhones, open Settings, select Camera and tap Record Video. Select one of the 4K options. (I go with 30 frames per second.) This will ensure that your camera is recording video at its highest resolution. The downside is that your recordings will clog more of the phone’s digital storage. But if you paid for a fancy camera, why not put it to use?
Minimize distractions on your wrist: On the Apple Watch, I prefer to turn off notifications for every app except for messaging and workout apps. To do that, open the Watch app on your iPhone, tap Notifications and switch off notifications for each app. (Also, I always keep the watch’s sounds muted.)
Put your favorite features in close reach: On Android phones, you can customize the “quick settings” menu for shortcuts to features that you use often. Swipe down from the top of the smartphone screen, and swipe down again. If you tap the icon that looks like a pencil, you can chose to add tiles that let you, for example, turn on your phone’s flashlight or go into airplane mode from your phone’s home screen. You can also rearrange the order of these feature shortcuts to suit your preferences.
Before we go …
Congress moves closer to funding U.S. chip factories: The U.S. government seems likely to do something relatively rare, and use taxpayer money to subsidize an industry — in this case it will pay computer chip manufacturers to make some products in the United States. My colleague Catie Edmondson reported that the goal of this funding, which also includes a bunch of money to support American scientific and tech research, is to counter China. There’s also a long list of other missions, some of which are more muddled.
From The New York Times Opinion: U.S. supremacy in important tech areas, like chips, demands that America do more to create a pipeline of talent, both in the United States and abroad.
Two historians found people’s psychiatric asylum medical records for sale on eBay. They wrote in Slate that e-commerce sites should take more responsibility for what they sell, and they worry that the public is treating mental illness and disability as an amusement.
A video game that’s both an escape from and a reminder of illness: A writer for The Washington Post, Gene Park, was diagnosed with cancer recently and found himself hooked on “Cyberpunk 2077,” a video game about how to navigate terminal illness. “I am not much closer to understanding my sudden fascination with this title given my current predicament,” Park wrote.
Hugs to this
Look at these teeny baby jacana birds! (Jacanas are tropical wading birds with very long legs and toes.)
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