Tech Bullies Behaving Badly

Tech giants have thrown their weight around to get what they want for years. In grade-school parlance, they’re called playground bullies. Some companies show downright contempt; others find redemption (or at least a little humility). Here are well-known tech companies indulging in boorish behavior.

Let’s start with the company that inspired this list: Google, also known as the Evil Empire. Last week, the U.S. Federal Trade Commission fined Google $22.5 million for tracking users of Apple’s Safari browser via an advertising cookie. Google had told users they could opt out of tracking but tracked them anyway. That goes beyond sneaky and into devious. Now here comes the hubris: As part of the settlement, Google does not have to admit wrongdoing.

Google, though, does take care of employees (well, maybe not Motorola employees) with an impressive death benefit to spouses and domestic partners: 50 percent of a deceased Google employee’s salary for 10 years, immediate stock vesting, and $1000 monthly payment to surviving children.

Microsoft was the first bully to own the tech playground. Pity the company that found itself in Microsoft’s crosshairs. The word “ruthless” comes to mind. Remember when Netscape Navigator rose up to challenge Microsoft Internet Explorer in the great browser war? The conflict drew in the Department of Justice and put Bill Gates on the stand. Oh, Netscape isn’t around anymore.

A kinder Microsoft exists today, largely because it no longer sits in the driver’s seat.

Facebook beckoned us to join its free social network, and we checked it out. After a while, we came en masse. We’ve feasted on our profiles, photos and friends and have made Facebook a big part of our daily lives. Then Facebook turned into a sneaky privacy pirate, pushing complex privacy settings to its limits. Give up more of your privacy or abandon us at your social peril, Facebook seems to be saying. That ain’t right. But humility has arrived on the Facebook campus. Its stock has tanked 40 percent since its initial public offering three months ago.

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Yahoo has long seen profits in China, which has led to Yahoo making outrageous transgressions. The most serious was the outing of Chinese dissidents via Yahoo mail accounts five years ago, resulting in a reporter sentenced to 10 years in prison. At first, Yahoo testified before Congress that it didn’t know the nature of the dissidents’ investigation, only to recant shortly after.

The ugly episode ruined Yahoo’s pulling-for-the-underdog image. Yahoo has had five CEOs in the last five years, as the company struggles to remain relevant.

AOL started out with such promise as the granddaddy of the Internet, and then it went downhill. Last year, the New Yorker’s Ken Auletta reported shocking behavior: “The company still gets 80 percent of its profits from subscribers, many of whom are older people who have cable or DSL service but don’t realize that they need not pay an additional twenty-five dollars a month to get online and check their e-mail. ‘The dirty little secret,’ a former AOL executive says, ‘is that 75 percent of the people who subscribe to AOL’s dial-up service don’t need it.'”

Apple should be applauded for stripping the complexity out of technology and bringing great products to the masses. In doing so, though, the company has shunned standards and become freakishly controlling. From tamper-resistant Pentalobular screws to proprietary dock connectors to a walled-garden App Store, Apple makes it difficult for customers to escape its ecosystem. Quite the irony from Apple’s 1984 image as a rebel fighting against control.

Together, these companies enable the great age of communication. They also share another thing in common: shoddy customer service. Telecommunications companies are notorious for putting phone-calling customers on hold or transferring them around. Not many companies treat their customers like second-class citizens, but these telcos share in an industry-wide culture of customer apathy.

Samsung and Apple are embroiled in one of the great patent disputes of our time. Did Samsung rip off Apple’s iPhone-iPad design? A Samsung executive’s memo revealed that the iPhone had caused a “crisis of design” and that the Samsung and Apple smartphones were “a difference between Heaven and Earth.” The trial is only starting to heat up, but at least one thing is certain to surface: more bad behavior.

The high cost and complexity of integration threatened to derail the enterprise software movement, and so companies like Infosys came to the rescue bearing skilled labor (and big invoices, too). But Infosys, one of India’s biggest IT firms, has apparently run aground of labor laws. Infosys is under investigation for visa fraud. Infosys allegedly brings Indian workers to the U.S. on business visas, which don’t allow work, and then puts them to work while circumventing the payroll system in the U.S.

When giant tech companies are conniving and devious everyone in technology looks bad. But they don’t start out that way. Here’s how most tech companies get their start in Silicon Valley: an entrepreneurial engineer with a great idea and dreams of changing the world scores some venture capital and pursues the American Dream. From these humble beginnings, some companies get too big — or is it too desperate? — and become playground bullies. Only the best recover and redeem themselves.