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GAFAM’s supply chains

Do Big Data Challenge Governement’s Powers?

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Since the coronavirus COVID-19 pandemic crisis started, GAFAM’s supply chains have been at the heart of the debate – so did their data. 

Amazon, Facebook, Netflix and Google have been playing a key role in the most affected countries for the population to stay in touch, order food and basic supplies, as well as receiving orders and updates from the government. 

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So, what if the big data was becoming more powerful than the governments in power? What if Amazon, Google or Facebook could become their own entity and manage data the government doesn’t have on its citizens? 

Here is an overview of what the New York Times called a “government vacuum the tech giant is quickly filling”.

Amazon controls food orders

It has only been a year since Amazon has bought U.S biggest organic supermarket chain Whole Foods and since Americans has to stay home, they are now ordering online. According to the New York Times: “From Feb. 20 to March 15, over-the-counter cold medicine sales rose ninefold on Amazon in the United States from a year earlier. Dog food orders increased 13-fold, and paper towels and toilet paper sales tripled, according to CommerceIQ.” 

Without sharing further numbers, Amazon confirmed that the daily number of orders across the country was equivalent to the holiday season – thus the tech giant said it is hiring 100,000 workers, in order to fill in the exceptional high demand.

While restricting purchases to basic products – holding on the purchase of leisure-related products – Amazon has now gathered the biggest data in America on consuming habits.

According to Julia Carrie Wong from the Guardian: “There is a fragility that comes from relying on a single pipeline. If we let Amazon’s strength over dominate our entire economy, we may just find out how weak we are.” 

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Stacy Mitchell, the co-director of the Institute for Local Self-Reliance, added in The Guardian: “We could see the distribution of consumer goods collapse into a single pipeline named Amazon. It’s incredibly risky.”

Netflix, Google & FB, the data masters

Since 43% of the world’s population is currently staying at home, dozens of millions of online users are consuming more content than ever. Within a few days, Netflix, Google and Facebook have become content masters.

Demand has been so high that Netflix and Google’s Youtube have announced they would lower their videos quality, in order for all viewers to watch movies and TV shows.

In the meantime, viewers have reached new highs in content consumption. This gives clear insights on users’ preferences, more than government can collect at the moment.

Read on Alvexo: “Tech Giants to Double Their Market Valuation”

Experts say GAFAMS stocks are a safe bet

For the past weeks, stocks have sharply fell: Amazon, for instance has fell from $2,170 to $1,689 a share within a few days.

Nonetheless, “The stocks of Apple, Microsoft, Amazon, Facebook and Google’s parent company, Alphabet, have collectively lost more than $1 trillion in market value from a month ago, when U.S. stocks traded at record highs. And Microsoft and Apple have cut their short-term financial forecasts because of slowing consumer spending.”, according to the New York Times.

However, analysts are optimistic. For example, Apple’s iPhone sales grew 18% to $690 over the first quarter and “Google’s share of Android app sales rose 5 percent to roughly $360 million, according to Sensor Tower, an app data firm.”, report the New York Times.

According to the institute Wedbush, tech giants could highly benefit from the current situation, just like they did after the financial crisis in 2008. On April 1st, Amazon’s stock was strongly back at $1,907.

Note: The opinions expressed in this article are the author's own and do not necessarily reflect the view of Alvexo on the matter.