all right guys how are we doing today Steve Mingo final web design today's video I want to review a video that is talking about the collapse of the US tech industry give you my thoughts as somebody who's been in this field for about 15 years professionally now and just kind of review the state of the US tech collapse with you guys so let's get into [Music] it final web design this is Steve all right guys so here we are um I'm going to get into the video I'll stop it and kind of go over the pieces as they come together chaos almost all of the major big tech companies are collapsing for example meta is worth over a trillion in 2021 but just a year later and their value has dropped by 2/3 and the other Giants aren far behind Amazon meta Twitter Tesla Netflix have all seen massive Revenue drops and the scale of these losses is I mean I don't think that this is a big surprise everybody knows currently that there's been a huge layoff in the tech industry from all of the big tech companies everything I think it started with Twitter uh Microsoft Tesla Uber uh Salesforce I mean you name it these Tech Industries have been laying off people and as you saw there it said a quarter of a million I'd be surprised if it's not even more so let's kind of continue and see why this is happening and what's about to happen here in the future unprecedented especially considering big Tech has been so Unstoppable for the last decade in fact revenues and profits was skyrocketing Silicon Valley was a billionaire Factory with some of the most prolific billionaires building the names in the their bank accounts on the back of big tech companies Bill Gates Elon Musk Jeff Bezos Mark Zuckerberg Jack dorsy all of them were created by the massive T boom of the last four decades but then the bubble popped and now the biggest names to Silicon Valley are seeing their revenue plummet firing hundreds of thousands of employees with the stock value of almost every big tech company falling dramatically which leads us to the question how did it get this bad so quickly well you see so that question about how did it get so bad so quickly um I mean I have pretty good answer and it's multiple different factors and I think we're going to get into that as far as more detail but you got everything that just the this the market was flooded they were there was too much money for cheap labor and they were trying to just hire as many talents and and work employees Tech employees as they could for most of these big companies in the early 2000s and around the covid uh period so let's go into kind of where things are at now a few years later as the industries progressed Tech was a growing part of the world's economy for years over the last decade tech companies have only got larger and larger and of course there were ups and downs for example the Doom crash of the late '90s proved the catastrophic consequences of overvaluing tech companies however over time the industry always picked up again it was a measured climate first but soon people forgot the mistakes of the past and as the years Roll by and Technology improved the companies behind it grew richer and richer but there were massive problems in the Horizon facilicon Valley because the path wasn't all golden for example companies like uber have coasted on their potential hoovering up Investments without a proper model for profitability the same could be said for Twitter and yet despite this the you know that's what I always find so funny is these huge American Tech corporations that aren't even technically profitable I know you know the stocks and the value and the Investments and there's a lot of pieces that go into a business but at the end of the day when you see a company like uber that's probably doing millions billions of dollars a day in transactions and they're not profitable is is a pretty telling sign um but you know it does it does take investment to get these things going it's not a small small app giant the industry G to immense proportions on pay for example in 2018 meta surpassed $500 billion in net worth and Amazon were closing in on a trillion but all of these companies had a similar problem they just weren't worth what people thought they were their business models were shaky and in constant need of Investments or they just didn't make that much money to begin with the margins were always incredibly tight and that's why almost all of these Tech billionaires never look at the stock price that whole period is very interesting because the stock is not the company and the company is not the stock and so as I watched the stock fall from 113 to I was also watching all of our internal business metrics every single thing about the business was getting better and fast because they believed as their technology spread into every aspect of the World Companies would always ride the w of future potential their shaky business model just didn't appear to be an issue at this point all these big tech companies were gaining more and more power and it seemed like they were Untouchable because big Tech had something invaluable the eye and data of the entire world you see ever since they started and I think that's really what a lot of these companies have been become whether it's Google whether it's Facebook um they're getting your data they're getting your information they're tracking where you are they're viewing the pictures you let them view they're they're getting as much information as they can so these companies haven't just become a service but they've almost become a data mine which has become more valuable for you know governments and and other businesses and marketing and things like that and I think that's where we've really had to take a little bit of a cautionary step here um because they are they're they're Gathering so much data all these big companies and that's where they're really focused I mean the profits are one thing but the data is is invaluable pulling in user data the massive levels they do now social media companies were then further driven to maximize their engagement keeping people on the app for as long as possible and often as possible became the most important thing which is why we're all so addicted to our phones and our laptops it makes all of these big tech companies billions of dollars allowing them to sell more and more ads and exploit more and more of your data and over time these companies perect to this process by manipulating psychology making the apps so addictive that the entire world couldn't live without their smartphone and during this process they found out that anger and fear are some of the best ways to keep people engaged and so as the algorithms were fine treated for engagement they push more extreme and more provocative posts above gosh isn't that true when you get onto your social medias now in the last few years just how much of this like provocative material they show you whether it's people fighting or you know politics or it really goes into a whole like new place of social media when it started it was a lot of like hey let's connect with friends let's chat Let's uh see their pictures from the weekend and now it's become like as you can see in this screenshot right here uh so much political you can see a picture over here of uh I think it's Hillary Clinton but irregardless it's just like they put a lot of provocative stuff out there that they know because they have the data that is going to kind of trigger you or keep you engaged keep you coming back make you digging down that rabbit hole so yeah yeah you got to be you got to know what what's targeting you these days everything else putting them in front of everyone's faces constantly or while censoring any information that didn't fit into silicon Valley's political narrative which is why Twitter met and all these other companies became the breeding ground for social media addiction censorship and hatred and as time went on cycle ramped up and the culture were worsened and these changes in the online space were reflected in the real world leading to riots unrest and collapse it didn't matter to the tech companies who remembers those times um maybe the early 2020s when a lot L of this is brewing over whether it was the the social issues whether it was the global pandemic issues I mean this was just a time where where social media really took things to the next level and again it's because they're able to Target and Trigger and and get that information to the people's minds who probably don't need it because they know it's going to engage them keep them on longer keep them going again down that rabbit hole though in fact this was in their interest and instead of tackling the problems that they had caused themselves with their algorithms companies start to then lean further on censorship suppressing all counter opinions in the name of misinformation but this solution wouldn't work forever tech companies were going to pay the cost for their medling in public discourse however you know this gets me to the thought of when they took away the down thumb on the YouTube videos because it was giving away the sense that like people you'd watch these specific videos and there'd be 100,000 down views and 100 or 10,000 up and you're like well that's a 10 to one nobody's really getting this but at the same time in the public media this is what they're pushing you so um I remember that was one feature where I was like yeah they're really trying to like hide the manipulation of all this social media and what they're triggering people with because when you go in and you can see that that nobody's agreeing with it with the down likes um it really kind of stood out and they obviously they took that away for a reason which uh I think we can all agree was because they can hide the situation easier for now they had to deal with a much more conventional problem competition over [Music] the for the past decades China has exploded into the technology industry companies like tensen haawi and bance have been eating into the Western market share on a global scale in fact tensen has made numerous takeovers of Western companies like riots epic games and even Ubisoft and through these moves they've undermined Western dominance in the lucrative gaming industry with China owning some of the most popular games today like fortnite and League of Legends and China's also taking over with things like Tik Tok and 10 cents investments in Reddit and Discord and then haawi attacked Hardware manufacturers releasing cheaper alternatives loaded with Chinese data collection technology yomi did the same it's even greater effect despite only being founded in 2010 they've gained over 12% of the market yeah so this this is something I've obviously been very aware of is these Chinese tech companies that are coming out with their own Hardware um not only software with things like Tik Tok but the actual Hardware the phones the computers the laptops the iPad or the pads the tablets so what they're what I've always been concerned about and here in the United States we don't have this issue as much because we buy a lot of us products or Korean at the least um you know Apple iPhones things like that Samsungs but a lot of the Third World um you know Latin America Asia you know parts of Africa and stuff are using these Chinese products cuz they're obviously cheaper but at the same time I don't think a lot of these people are aware that the Chinese government or the CCP has access to this data I mean this isn't even like a hidden thing they're pretty upfront about it so whatever they're gathering for your data that these other companies in the west like uh Google and stuff I mean these Chinese hardware and software companies are definitely digging in and getting all that at a government type level and I think that's where we got to really see what happens over the next few years because some of these companies like H howwe I believe it said I don't even remember them 10 years ago and now now if I leave the United States and I go to a mall in another country or something you see these uh these stores open you see them in the us too but um definitely more Prevail for the the economic situations in other parts of the world that people use these and you got to be careful because that had information going right to the Chinese government already B dance is probably the most Sinister I mean China was well aware of the disrupted powers of social media long before the West had any idea and they studied what the Western companies were doing with engagement and turned it into an R form with Tik Tok exploding in popularity by playing on Silicon valle's addictive business model and by learning from Silicon Valle successes and mistakes Tik Tok is growing by 400% every single year seizing Western social media companies audiences from under their noses which is why you know Tik Tok grew fast but it's like any technology I think it's going to kind of have its wave it's a new thing um and eventually you know a new product will come out people move to that it's it's what it is um Miss every major app has now adopted Tik Tok short video model and to put it plainly this is a targeted attack when comeb all these companies have Incredibly Close relationships with the CCP which has given them enormous room to scale up because no matter how profitable these companies are they've always got the Chinese government behind their back and this gives them a massive advantage over the West they don't have to deal with pesky human right laws ethical impediments or even profitability in said they can be safe in the knowledge that as long as they pull the party line they can get away with virtually anything and this isn't just within China this is everywhere they get government backing abroad as all of these Chinese big social media sites are practically a third party of the Chinese government and as they work in tandem these companies have become an Unstoppable force and so whilst the Western tech companies are always at each other's throats China's Tech Giants have been allowed to build their monop in peace which is why every day China gains a little more ground on the west because for every user and customer that China gains Silicon Valley gets weaker and this new threat has been awful for big Tech's bottom lines and the true consequences have only just begun to I mean there's obviously some truth to there but like at the same time we do need some Global innovation in other parts of the world in the United States I wish Europe had more more you know tech companies um there's some reasons I think for that I wish the rest of Asia had more tech companies outside of you know China um that was producing you know Japan's obviously a big Tech producer but it's not so bad to have a little bit of Silicon Valley going to the rest of the world I mean there's still a huge Market there and again a lot of westerners aren't going to want to use these these uh intimidating products from third from other countries that they don't trust so it's it's not a big deal I don't see that as being the big issue really I see more um going into the next things that just the the market got out of control people were getting employed that didn't need it so today but they hadn't affected the numbers yet apps Tik Tok were only just getting started and massive growth was still expected and by the end of 2016 some journalists were haing Silicon Valley as the future they said this because something dramatic had changed the list of the top companies used to always be dominated by oil and Manufacturing and a few Financial Giants that relied on their Shar scale to dominate but these companies have now been replaced by Google Amazon Tesla apple and Microsoft pushing out the Old Guard however despite their immense valuations these companies still weren't nearly as profitable as they should have been from 1995 to 2015 Amazon only made $2 billion in profits despite the company approaching a trillion dollar net worth now yes this move was meant to dodge taxes yet it still portrayed a significant disconnect between Silicon Valley and the rest of the world rather than focusing on profitability Silicon Valley companies were much more focused on growth and the best example of this is Uber you see Uber spent years focused entirely on growth above anything else they embodied the Silicon Valley Mantra breaking laws in Industries to cement themselves in the market with a massive leak shown that Uber Executives was shown instructing their employees to use chaos and violence to upro the taxi industry and put pressure on governments and of course they had big problems with actually making enough money I mean their business model still has incredibly low margins even after they started to squeeze every penny they could and raising all of their prices which has caused Uber to be in a worrying situation with Market saturation their stock price is plummeting and you know I find that very funny I know that this video is a year old but like how can a company like uber that I mean I use basically every day um not every day but I use it quite often and you know I give them probably a couple hundred bucks a month I'm surprised that they can't find a way to make that profitable whether they have to increase the prices or again downsize the company um but that's that's pretty crazy they've been around a long time the company streams of market dominance now Fading Into the ground but Uber does still have a slight chance as Silicon Valley overconfidence has led to way more destructive collapses specifically in the case of wework in early 2019 wework was seen as an Innovative new company that was set to change the world of work although it was founded in New York if you learn gosh that was the funniest one you know anything about that storyes the sil valy mentality had definitely got into his founder Adam Newman the charismatic CEO was so good at convincing investors that he pulled in and only a few years after its founding the company had raised over a billion dollars for their office space company and I say office space company but we work was still listed as a tech company and so we work managed to raise over a billion dollars for the company right this is where things tech company became a Regis renting an office room there was no Tech involved it was simply a rental short-term rental to say we work as some tech company this is where things kind of started getting spun out of control it's not a valuable Tech it's another Regis that's been around for long time and this was despite Mass layups of the company and poor financial performance because simply enough investors were just in love with the idea rather than the products in front of them in fact Wei workor lost over $2 billion in 2018 and yet the hype continued analysis stated that the company was now worth over $40 billion this was more than giants like Airbnb and by September the company attempted to gain even more investor money beginning the process of an IPO or initial public offering and this would open the shares of the company to the public raising even further billions for Wei work and yet even with this enormous amount of investment the IPO started to gain scrutiny as investors started to see that the company was really making no money and it portrayed the true reality of the Silicon Valley business model massive debt and low Revenue proed up by other people's money and so and that's what you got to think think of all the expenses renting all that space Furnishing it all getting somebody in their employees to clean it and maintain it and check people in and out and all you're doing is renting I mean when I go to rework I'm spending like 50 bucks for the day I mean it's it's money but it's not like it just it really didn't all add up for the expenses that you see with something like that to to what you know the costs are probably why it didn't work out the $40 billion valuation was cut by three quarters in a matter of days resulting in 20% of the company being fired and Newman their CEO and other Executives were all forced to resign and the company is forced to cut back on its massive growth plans reality hit the company hard and today people are questioning the expiry date of we work but yet again Silicon Valley didn't learn from this example despite the very same business practices being used across tons of tech companies this was just seen as an isolated Case by Tech Elites besides now it wasn't the time to consolidate and slow down and then as 2019 came and went the world was forced into the pandemic first US case has been detected there confirmation the Corona virus oh I don't even want to get into this anymore I'm so over it but at the same time this obviously destroyed businesses across the world um for the tech industry though it was a booming time I I had so many offers and people just like please come work for us I mean it it was a pretty good time as far as work work was concerned but for most small businesses uh this was this was Destro this just destroyed themus has reached Australia and it was here the tech companies would double down covid-19 as it was for so many other billionaires and corporations was a massive opportunity for big Tech the pandemic saw tech companies values Rise by hundreds of billions they made so much money they barely even knew what to do with it and it was the belief at the top of these companies that this is just how things were Tech dominance into the future seemed all but guaranteed Soaker Burg and others would be risky and shortsighted in their Investments assuming that Revenue levels would stay strong after the pandemic and that's why meta's Workforce grew by 28% in just a year and Amazon massively expanded their own operations seeing their profits s by over 220% Apple spent an extra $90 billion just buying back their own stock during the pandemic betting an amount worth more than the GDP of Sri Lanka on their continued success you see tech companies made massive investments into themselves betting that the good times would never end and it was this overconfidence that men that when their profits finally did start to slow down they wouldn't be able to cope with it but overconfidence wasn't the only problem that worsen during the pandemic you see the culture war was getting more and more intense as people spend more time online unwinable arguments raged as people's lives got measurably worse and whilst the pandemic was lucrative for Te companies they were some of the Only Winners with lockdowns completely destroying the economy that's what I just said the tech industry it's been the best thing ever for the tech industry I haven't been to the office since technically all this happened because that's when we went into this new world where people are working remote where our teams are everywhere where we're able to you know not go into an office anymore so yeah it was completely destructive for all the brick and morar businesses the restaurants the tourism the hotels but for the tech industry this was a golden era and it's still kind of as far as changing the rules with the offices and stuff has never really kind of returned but the jobs now are nowhere near the same as what was happening during this period putting Millions out of jobs and businesses out of business and it's impossible to measure the negative effects of the pandemic on people and their mental health however what was measurable was the heating up of the culture war and eventually the results of this would be social media fatigue people were just sick of the culture war and China was now also closing in on silicum Valley yeah it wasn't that true that whole per period with all the social unrest it was just like I just had to shut it all off I'm just like what am I I'll do my marketing on here but everything else I'm just keep it away for now it was just too hot at least if you were in the United States it was a very tense time and all of this was being perpetuated through social media if you walked the streets or went to a there was no social issues as far as like day-to-day Communications but when you got on those apps it was just like fire going everywhere trying to put them out or trying to keep them going so um yeah that was a time to kind of get away and I think that's when the whole social industry is really taking a big turn into more of not just friends and family and keeping up to date but more like just politics and business and advertisements and all these things that people kind of got on there to get away from as over the pandemic Tik Tok grew by hundreds of millions of users surpassing 1.1 billion in 2021 however all of these combining factors hadn't affected big Tech yet but it would only be a matter of time meanwhile the tech billionaires were enjoying their moments in the sun Jeff bezo spent Millions on a personal space trip whil Elon Musk became times person of the year for 2021 but all of this would turn out to be some of the last good news these Tech billionaires had as once the world finally opened up again it signaled the end of silicon Valley's boom even if no one believed it for example at meta Revenue growth had risen to over 50% in the summer of 2021 but it dropped sharply over the next 9 months falling to just 5% by the first quarter of 2022 Amazon also saw a sharp decline from over 40% to around 7% in the same time span even usually stable companies like Microsoft or apples suffered the same fate seeing their growth levels fall off so what happened here well all of the growing problems that Silicon Valley thought they could ignore were finally making their Mark and once they had been shielded from the pandemic recession by artificial demand that was all over now and the economy was only getting worse so people yeah that was a tough time um still hasn't really come back Less on products people didn't care about ads Essentials became more expensive so people had less disposable income Services saw a boost as well as people made up for the L time and on top of this the culture War had burned tons of people out as well leading to less usage of social media a Canadian survey found that less people were using Facebook YouTube and Twitter in 2022 than in 2020 and the only tech company that was Spar from the decline was Tik Tok their growth was unimpeded maybe because they're artificially propped up by the Chinese government it was clear for everyone in Silicon Valley that they were losing their audien's attention and with this dramatic reduction in attention came dramatic Cuts in their profits and this is when the crack started to show tech companies have become so focused on growth that when it dried up it hit them much harder than other Industries over the course of 2022 tech companies lost more and more money leading to their CEOs to make some erratic decisions M took over a CEO of Twitter after years of negotiations and legal battles he started off by firing large part so this is where I think the change really started and the downfall when mus took over TT among other elements that we kind of discussed he right away as somebody who knows JavaScript he knows Frameworks he knows programming he's read the books he's done the projects he's been in their handson um he he knew right away we don't you know once an application is built and launched it you'd be surprised it takes a a team but it takes a small team to maintain and kind of update it going forward cuz you're not building the whole thing from the ground up you're just maintaining and maybe adding a few new features over the course of you know your your your uploads um what I'm what I'm saying is this time was when we saw firsthand that somebody knew what was really going on cuz I remember even working like with um some of the big Health Care Providers some of the universities and it's like what they were doing was just silly I mean they would have teams of people creating new CSS uh Frameworks or css classes it was just like what why do you need this there's already bootstrap there's already a million other things you could currently use that people know to create your own internal is just a waste of time money and I'm sure it never even got used after we built all that stuff um but there's just little things like that you saw it kind of coming and you saw it was just like what are what are I mean every everything was the nicest uh you could get the nicest standup tables the nicest monitors the nicest computer I mean it was just a lot of money going around those places um at least at this period this was maybe four or five years ago so let's see where things go with Twitter cuz that site's still up it's running it's running great as far as I can tell parts of the workforce leading to massive technical glitches and problems with the app things were going so badly that he was forced to resign from the company Google had put much of their focus on their new stadia Cloud console but as with every other big tech company 2022 stadia Cloud CL I knew that wasn't going to make it there why that that was quick I haven't seen that in a few years also saw its demise being forced to refund everyone who bought it without Google actually getting the products back additionally Uber saw a sharp decline their business the ruther's competition massive leaks and higher prices meta stock value dropped by around 60% with Tesla dropping by 70% so once 2022 was nearing its end tech companies realized it wasn't going to get any better anytime soon they needed to cut cost which is why you started to see articles of these big tech companies firing tens of thousands of workers like with Microsoft firing over 1 th000 employees then stripe a growing startup letting go of 14% of their Workforce Elon was forced to lay off nearly 4,000 people from Twitter with meta following shortly after laying off a further 11,000 people Amazon cut then numbers by 10,000 and all of this has happened in just over a month eventually am that is so many people losing their jobs it is insane to think where all these people have gone um you know the industry had changed it needed smaller amounts of people you know the jobs are still out there there're still plent of demand for tech industry but as far as these big companies they they've thinned down and they're they're really cutting every cost and they're making sure that their employees are being responsible for the pieces that need to get done uh no more slacking around double their numbers in December as clearly they hadn't shrunk enough and these weren't minimum wage employees either they were both High skilled and Incredibly expensive employees and in total over 1,000 tech companies fired over 150,000 workers basilicum Valley had made their bed with their risky investments in growth focused ethos the same companies that had fought over these workers in the Talon Wars which was just a year or two ago but now letting them go and incurring massive costs in the process and it wasn't just going to cost them at the time either these firing sprees represent a massive amount of people with incredibly valuable skills a job board called tech jobs for good has seen massive increases and skill drob Seekers off of the back of these layoffs people have seen the fast life of big tech companies are now instead looking to make a difference despite a small hit to their paychecks and this is one of the ways in which the collapse of big Tech Will inadvertently benefit the world but perhaps this is symptomatic of a much larger Trend in our economy as going into 2023 with the UN predicting we're going to be in a massive recession it seems like Silicon Valley can only expect more and more suffering the future looks Grim ad buys are low which is how all of social media companies like meta and supply chain issues and enough threatening Hardware companies like apple and Microsoft governments are also now souring on big Tech seeing their influence as destabilizing Microsoft's $69 billion acquisition deal for Activision and blizzard is being debated by Monopoly Watchdogs around the world the FTC has already tried to block it meanwhile the whole tech industry is waiting for another Court verdict on recommendation algorithms Google is being sued for recommending videos made by terrorists which then incited an attack in France and if they're found liable this will upend years of legal Doctrine stating that digital platforms aren't responsible for what people post the results of the case will detate what's allowed for years to come and will possibly [ __ ] companies like Google and meta it is very clear to everyone in the tech world that 2023 is going to be the true test for these Tech Giants and so far only a week into the year and Amazon has already so yeah as you heard going into 2023 what what happened and what happened in the first part of 2024 more layoffs more Cuts more job losses so that's kind of the end of the video and I'll just kind of give my two cents here I mean we are in a definitely a different period than where things were even a few years ago I still think that this is a great industry if you know what you're doing if you know you know more than just code if you know how to work with a business if you know how to help with their social medias their graphic design or video editing not just the website not maybe some SEO you know if you can put all of these other skills to use I think that this is still a very great market now if you're going to try to go work at you know YouTube or Google and say hey I'm going to you know have a career out of this for the next 20 30 years that that's just not the case get in there get those big six figure incomes get the good benefits have it fun with it but don't look at it as a career forever because obviously you can see how quick this stuff changes I always have other options that's what they used to say you know starting your own business or having some type of entrepreneur is always a very dangerous thing but really in these times it's almost safer than having a 9 to-5 job because unfortunately N9 to-5 jobs are not what our grandparents or parents had I mean they they really will cut you in a moment as you can see here so guys with that being said um I hope you like this video If you give it a like And subscribe that stuff helps and if you have any any questions about the industry or about the skill sets needed uh let me know in the comments or give us a call I'd love to help you and guys with that we'll catch you in the next video take care peace [Music]
2024-06-08