Uwe Eisenbeis, Magdalena Ciepluch: TECHNOLOGY ACQUISITIONS AS THE NEW POWER. AN APPROACH ON HOW GAFAM HAVE MANAGED TO WIN THE WAR FOR INNOVATION, THE WAR FOR PATENTS, THE WAR FOR TALENTS, AND THE WAR FOR DATA

Scientific paper

Uwe Eisenbeis, Hochschule der Medien, Stuttgart (Stuttgart Media University)

Magdalena Ciepluch, Hochschule der Medien, Stuttgart (Stuttgart Media University)

DOI: https://doi.org/10.59014/XVQT4385

Keywords:

Big Tech, GAFAM, M&A, Strategic Power, Technology Acquisitions

Abstract

Looking at the global technology acquisitions over the past 20 years, it becomes clear
that a major share of these transactions is made by the US-based “Big 5” technology
companies (also known as GAFAM – Google, Amazon, Facebook, Apple, and
Microsoft).
Given the market power of GAFAM (Dolata, 2017), which is evident not only in
form of market capitalization, revenues, and profits, but also in the other dimensions
of competitive strategy – such as innovation, patents, talent/people, and data, – it
seems interesting to examine whether one of the main reasons for the overwhelming
power of these companies is their obvious and almost unlimited ability to make
technology acquisitions.
Against the background of the umbrella theme of the conference “POWER”, it is
thematically and methodologically suitable to conduct a thought experiment based
on the theoretical concept called “Concept of Strategic Power” (Scholz, 1987; 2001).
This approach considers power as an interplay of strategic capabilities, strategic movements
and strategic barriers and allows an evaluation of strategic power as a source of
competitive advantage and market success (Scholz, 2001).
The results show that GAFAM’s high acquisition power enables it to make any acquisition
it wants and thereby trigger strategic movements. These produce the interdependent and

self-reinforcing effect of gaining strategic power to win the war for
innovation, the war for patents, the war for talent, and the war for data.

This paper is licensed under Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

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