Articles about this milestone started appearing in the first week of August, actually, but a few days ago it became official: Apple is the first tech company to hit a market capitalization of two trillion dollars, the first US one to do so, and only the second one in history (oil giant Saudi Aramco hit it first in December but that stock has since dropped significantly). Even if “market cap” is a term of dubious significance and artificial value — rendering said milestone largely arbitrary — 2 trillion dollars is an amount of money hard for anyone to get their head around: current stock price-calculated, yes, but still. Two. Trillion. Dollars.
It may be the inconceivable nature of this number that raises one of the most important issues in modern economic sciences and offers one of the great paradoxes of our time: the almost obscene growth of multinational corporations, particularly tech ones, at the expense of the very consumers they need in order to exist.
Not Apple, not Google or Microsoft or Facebook or any other tech giant is actually worth two trillion dollars. This is a number not connected to real-world value: it’s just the sum of stock available multiplied by (today’s) stock value. If Apple’s stock price falls in a few weeks the company’s “worth” won’t be $2 trillion anymore, even if its leadership changes nothing on a sales or product or planning level. This is a good indication of market caps meaning practically nothing outside of quarterly reports. The paradox lies in the fact that this two trillion dollar image of Apple is partly based on real data, a significant part of which paints the Cupertino giant in a bad light.
Yes, Apple is profitable in almost every category its products or services compete. Yes, its margins are the envy of every other manufacturer, a metric investors always like. Yes, it has accumulated a lot of capital and assets. But all of the above came to be because Apple’s products are manufactured in countries where wages are pitifully low and working conditions questionable at best. It all came to be because Apple overcharges for every single component of those products and gets a clearly unfair cut for all of the network and software services it provides. It all came to be because Apple puts enormous, bullish pressure on suppliers for thinner margins every year so it can maintain or increase its own. It all came to be because Apple systematically evades taxing of its revenue and hides most of its capital and assets in tax havens all over the world.
It may be naive to think that — since the very economic model tech corporations thrived on works this way globally — a company like Apple would operate differently. It’s quite disturbing to realize, though, that Apple is actually rewarded by the stock market for its unethical practices and choices. That two trillion-dollar valuation is of little meaning but, at the same time, it is also a gesture of encouragement for the company’s leadership to keep moving in the direction they do now. Because, well, capitalism: it does not matter that Apple accumulates actual wealth that just sits there, being used for nothing that would make anyone’s life better. It does not matter that the company’s charity efforts pale to insignificance compared to its profits. As long as Apple makes money for investors, it’s deemed to be successful. Just in the most self-serving way possible.
That is why, at the end of the day, Apple should not be proud of its recently hit 2 trillion market cap. They should be ashamed of it. The way the company operates is nothing short of parasitic. Its contribution to society is minimal compared to the obscene wealth the company has amassed through manipulating and overcharging that very same society. Apple does not give enough back and it does not do enough to help any cause of real worth. It does a lot more to suppress, hinder and undermine fair competition and innovation in ways that benefit this company and this company alone.
So… no. A two billion market cap is not an achievement. It is just proof of Apple’s ruthlessness and its ability to exploit and abuse a broken system. Nothing more.
All the talk about this milestone, interestingly, comes at a testing time for the company: it is under investigation in separate cases for anti-competitive practices in the US and Europe, it is universally under fire regarding its various App Store policies, it is facing criticism from other tech companies like Epic, Facebook, Spotify and Microsoft. But it is still following the same self-serving approach in all matters, it is still extremely profitable, it is still preparing for a major new chapter in its history (the transition to Apple silicon for all of its products). In Cupertino, it’s business as usual despite everything.
In some respects that is why this market cap milestone of 2 trillion dollars seems so at odds with what is actually going on in the world right now. In a time that hundreds of millions of people are going through a pandemic — lives lost, jobs lost, homes lost, future uncertain in so many ways — Apple is doing great. That would not be shameful in and of itself if it were not at the expense of the society that enabled Apple’s success. The very society that’s suffering these days. It is this disconnect that cannot be overlooked anymore and it’s high time the company’s leadership realized that and acted accordingly.
The question is: can it and will it? We’ll all be watching closely.