Tech giants spend $80 billion in 2017 to keep competitive edge

Posted on Tuesday, Sep 25 2018 @ 11:49 CEST by Thomas De Maesschalck
A new Bloomberg article highlights that US tech giants are now one of the United States' biggest spenders on capital goods. Last year, Alphabet, Apple, Amazon, Microsoft and Facebook spent a combined total of $80 billion on expensive physical assets, including manufacturing equipment, specialized assembly tools, and undersea Internet cables. Impressive figure, it's up from $40 billion in 2015.
Their combined outlay is about 10 times what GM spends annually on its plants, vehicle-assembly robots, and other materials. The splurge by tech companies is behind an upswing in capital-goods spending among big U.S. companies, which is seeing its fastest growth in years, according to a Credit Suisse analysis. The $80 billion tab also is a snapshot of why it’s tough to unseat the tech giants. How can a company hope to compete with Google’s driverless cars when it spends $20 billion a year to ensure it has the best laser-guided sensors and computer chips? There are a lot of physical assets behind all those internet clouds.


About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.



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