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Facebook, Google hinder innovation, says investor George Soros at Davos

27 January 2018

"Clearly I consider the Trump administration a danger to the world", Soros said.

The Hungarian-born billionaire predicted that the Trump administration would be a temporary phenomenon and would disappear in 2020 or sooner.

In a wide-ranging showpiece speech, the Hungarian/American also says internet platform monopolies are harming society and endangering democracy and goes on to predict a Democratic landslide in the United States' 2018 midterm elections.

Soros, the 87-year-old chairman of Soros Fund Management, said his Open Society Foundations are spending more than half of their budget "closer to home" rather than in the developing world, in an effort to protect democracy. Most of those organizations were said to be funded by George Soros, which raised questions about whether the groups were struggling for democratic values or they were merely trying to make Trump's tenure more hard.

Speaking at a dinner at the World Economic Forum in Davos on Thursday, George Soros delivered a scathing speech in which he said Facebook and Google were a "menace" to society and called for increased government regulation of both companies.

Soros said: "They exploit the data they control, bundle the services they offer and use discriminatory pricing to keep for themselves more of the benefits that otherwise they would have to share with consumers".

Escalating tensions between the US and North Korea could boil over, and nuclear war is a distinct possibility, Soros warned.

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In broad terms Soros also accused Facebook and Google of deceiving users "by manipulating their attention and directing it towards their own commercial purposes" and noted how they are damaging to youth since they "deliberately engineer addiction to the services they provide", which "can be very harmful, particularly for adolescents".

Further condemnation awaited the US IT giants Facebook and Google.

Soros said that these tech giants claim that they are distributing information but they are distributing monopoly instead.

A representative from Facebook had no comment on the remarks. But he doesn't see them crashing due to their use by authoritarian regimes in the world.

"The distinguishing feature of internet platforms is that they are networks and they enjoy rising marginal returns", he said. Soros notes how Europe protects against the abuse of monopolies regardless of how their power was achieved, unlike the US, which regulates based on acquisitions.

Soros acknowledged that Europe's approach to antitrust law and regulation differs from that of the United States. He actually still hopes to see the United Kingdom remain a member of the European Union, or eventually rejoin the club. According to The Wall Street Journal, Soros lost about $1 billion on wrong-way bets following the stock market's rally after Trump's election victory. Since then, the S&P's 500 Index rallied nearly 30 percent, according to Bloomberg.

Facebook, Google hinder innovation, says investor George Soros at Davos