Episode 9: Big tech: Healthy or harmful to competition?
02 May 2019
In recent years, the US retail and media sectors have experienced significant disruption thanks in large part to shifting consumer demands and technological innovation.
As a result, both are increasingly dominated by a handful of large firms – often referred to as ‘Big Tech’ or ‘FAANG’ in the popular press – that command rising market share. Looking at this heightened concentration from the traditional economists’ point of view, one could conclude that competition in these sectors must be waning. But is that truly what’s happening?
In this episode, Jeff Meli, Head of Research, and Jim Martin, US Credit Strategist, take a close look at competition in the retail and media sectors using the Barclays Competitiveness Indicator (BCI). The BCI assesses the competitive landscape using the characteristics associated with a competitive environment: labour share of income, business investment and business dynamism. They debate whether Big Tech companies are beneficial or detrimental to competition in each sector and the implications for investors.
For more information on this topic, download a copy of our fifth Impact Series report, Increased corporate concentration and the influence of market power (PDF, 2.4MB).
An expanded Impact Series study shines a spotlight on rising industrial concentration and its effects on the US economy.
About the analysts
Jeff Meli is Head of Research within the Investment Bank at Barclays. Jeff joined Barclays in 2005 as Head of US Credit Strategy Research. He later became Head of Credit Research. He was most recently Co-Head of FICC Research and Co-Head of Research before being named Head of Research globally. Previously, he worked at Deutsche Bank and JP Morgan, with a focus on structured credit. Jeff has a PhD in Finance from the University of Chicago and an AB in Mathematics from Princeton.
James K Martin is a US Credit Strategist at Barclays, focusing on the investment grade market. Jim joined Barclays in 2012 and worked as part of the London-based European Credit Strategy team covering High Yield and Loans before joining the New York-based US Credit Strategy team in 2017. Prior to Barclays, he worked at Greenwich Associates. He graduated Phi Beta Kappa from Trinity College with a BA in Economics and Formal Organisations.