Big Tech is building a $80B capex wall around its empire

#1

Originally published at: https://boingboing.net/2018/09/25/capex-vs-buybacks.html

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#2

it’s doing actual engineering, sinking $80B this year into capital expenditures that will form a wall around the industry’s incumbents, which new firms will have to scale in order to challenge them.

More of a moat than a wall, but it is interesting that they’re once again being built using real-world infrastructure.

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#3

“San Francisco-based Digital Realty purchased the tract. The company is a global provider of data centers.”

If you want to know where the trunk lines are follow the data centers.

(Silver Lining: “Money from the sale will go to a dedicated fund for reducing passenger costs assessed by the airport on airlines.” Dulles has one the most expensive gate fees around forcing airlines to crowd DCA, BWI and other local airports with lower operational costs. This will help move flights back to Dulles reducing airplane noise associated with overcrowded airspace.)

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#4

That language… you mean they’re building a literal figurative wall or something out of abstract concrete?

#5

Dulles --> Loudon County is loaded with data centers.

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#6

And of course, infrastructure spending does not contribute to inequality the way stock buybacks do.

Only if the infrastructure spending fails. If it succeeds, and raises the stock price in the long run as intended, the rich get richer even faster than if the company paid out money to its shareholders in the form of stock buybacks or by simply paying dividends.

It does actually pay some workers, which is the only benefit vs. stock buyback. They both are about utilizing shareholder money in an attempt to raise the stock price. Both can either work or fail at that goal.

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#7

Another consequence of big companies investing in infrastructure technologies is that, having done so, the big companies resist improvements that will make their investment obsolete. Case in point: the phone companies.

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#8

The good thing about physical infrastructure is that it can easily be seized by a government wanting to take anti-trust action. Whereas no-one really knows how to deal with a software monopoly.

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#9

Declaring capital investment to be anti-competitive is very strange.

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#10

The same finite webpage also has a sort of profile portrait of Al Gore and says he is ‘Still Optimistic.’ This is like saying that Hedge Funds reliably fund complementary technologies. As opposed to fun crates of 500 dry rations.

#11

I was kindof hoping they were building an infinitely long road that I could race fantastical motorcycles on at unbeliveable speeds, but whatevs. Robot spawing farms are cool too I guess.

closed #12

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