Enshittification 2.0: Why Big Tech’s Decline Was Inevitable
Silicon Valley’s Midlife Crisis & Its Divorce From Innovation
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After a decade as a fractional COO, watching tech from the inside, I’ve seen something few are willing to acknowledge: The innovation engine that once defined Big Tech has gone quiet.
In its place stands a profit machine that would make Wall Street proud, which should worry us all.
Yeah, yeah, I know.
“But what about AI, Neela? What about the metaverse? WHAT ABOUT all these ‘ground-breaking’ announcements?”
I’ve sat through enough board meetings to know the difference between innovation theatre and actual progress.
Sure, there have been strides in medical imaging and biotechnology, but what dominates Big Tech’s strategy today isn’t ground-breaking advancement — it’s marketing.
Slapping buzzwords onto every product isn’t innovation — it’s called branding.
Here’s what’s actually happening in those gleaming tech campuses where the future is supposedly being built:
Meeting #1 — “How can we squeeze more revenue from our existing features?”
Meeting #2 — “Can we add a buzzword to this to justify a price increase?”
Meeting #3 — “What if we just bought our competition instead of innovating?”
Meeting #4 — “Let’s discuss our stock buyback strategy.”
Notice what’s missing? Any mention of solving actual problems or building something genuinely new.
I’ll give you some numbers because those don’t lie, even when tech executives get creative. By 2023, the top five tech companies spent $1 trillion on stock buybacks.
At first glance, that doesn’t seem too bad, until you step back and look at the trend.
In 2010, these companies aggressively invested in Research & Development, pushing the boundaries of technology. Apple, for example, was pouring resources into products that would redefine entire industries.
In 2023, Apple spent $77 billion buying back its stock — a figure that exceeded its entire R&D budget of $30 billion.
This change in priorities might be one reason other countries are starting to give the U.S. a run for its money. While we’ve been focused on short-term shareholder value, others are doubling down on strategic investments in infrastructure, innovation, and human capital, and it’s starting to show.
R&D Spending Comparison (2021):
United States: In 2021, the U.S. spent approximately $806 billion on R&D, up 10% from 2020.
China: In 2021, China invested about $667.6 billion in R&D, a 14% increase from 2020.
These figures show that while the U.S. maintained a lead in total R&D expenditures, China’s investment growth has been substantial, enough to reduce the disparity between the two countries.
A few weeks ago, Apple announced a $500 billion investment in the U.S. over the next four years, signaling a renewed commitment to long-term innovation.
Because when you dig into the details, this isn’t really new money. It’s largely what Apple was already planning to spend, just repackaged with a shiny red bow.
According to Apple’s announcement, this half-trillion includes:
Supplier partnerships, they were already maintaining.
Payroll for existing U.S. employees
Apple TV+ production costs (yes, really)
Infrastructure to support Apple Intelligence, their shiny new AI initiative
In other words, they didn’t suddenly decide to inject $500 billion into groundbreaking R&D. They just bundled their routine expenses into a press release and called it an “investment.”
And that’s not even the best part.
A chunk of this spending is going toward a 250,000-square-foot manufacturing facility in Houston, set to open in 2026. Sounds impressive, except Apple’s been slowly expanding domestic manufacturing for years. This is business as usual.
Then there’s the “Manufacturing Academy” in Michigan, designed to train future U.S. manufacturers. Nice in theory, but again, this builds on existing programs rather than creating something truly new.
Look, I’m not saying Apple isn’t investing in the U.S. economy. They are. But this announcement isn’t a big change— it’s a headline-grabbing way to look good while keeping Wall Street happy.
Buybacks Aren’t Inherently ‘Evil’
Sometimes, they’re smart business, especially when you’re sitting on heaps of cash and need to keep investors happy. But when stock buybacks are outpacing real investment, you’ve got to ask: What’s the real game plan here?
Are we still pushing boundaries or just tweaking the same tired products and bumping the stock price?
Research and development (R&D) is where the magic happens.
When companies invest their money there, we all win. But when the focus changes to buying back shares, we’re left with inflated stock prices, happy Wall Street suits, and… the same old products with shinier packaging.
Think of it this way!
R&D is planting seeds for future orchards. Buybacks are selling the land for quick cash. Both are legal business strategies, but only one builds lasting value.
And yes, I can already hear the counterargument:
“Innovation isn’t just about breakthrough products — it’s also about incremental improvements and infrastructure.”
Fair point.
But here’s the difference: When I started in tech, those incremental improvements were the foundation for bigger visions.
Now? They’re endpoints.
Take software updates — we’re not seeing genuine breakthroughs. We’re seeing features repackaged as ‘innovation’ to justify price hikes. The metrics haven’t changed — what’s changed is what we’re willing to call innovation.
When I started working with tech companies ten years ago, there was still this electric sense that anything was possible.
Today, Silly-Con Valley’s biggest innovations are new ways to monetize features that used to be free.
Let me explain because it’s important to understand the pattern:
Phase 1 — Company A creates something genuinely innovative
Phase 2 — Company A goes public or gets major funding
Phase 3 — Growth becomes the only metric that matters
Phase 4 — Innovation gets sacrificed on the altar of predictable returns
Phase 5 — Company A becomes what it initially set out to disrupt
The real tragedy is the system is working exactly as designed. Wall Street rewards companies for predictable growth, not risky innovation.
The Wrong Results
Tech executives get bonuses for hitting quarterly targets, not for building the future. The incentives are perfectly aligned to produce the wrong results.
There are still companies pushing boundaries — Zoom comes to mind.
But it proves my point. The company succeeded by maintaining private control long enough to pursue long-term innovation without the burden of quarterly earnings pressure.
Even Zoom, now public (2019), shows signs of prioritizing short-term market reactions over long-term technological advancement. The exception proves the rule: our market structure often stifles big, risky bets and favors predictable returns.
Do you want to know how bad it’s gotten?
I recently sat in a meeting where a CEO killed a potentially game-changing project because it might cannibalize their existing product line.
The project’s estimated impact? It could have helped millions of users.
But hey, you can’t risk those sweet, sweet profit margins.
Think I’m being too harsh?
Let’s look at the “innovations” Big Tech has rolled out recently:
Subscription features for basic functionality (looking at you, Meta)
Software updates that are glorified tweaks
“Revolutionary” hardware updates that amount to slightly better cameras
Privacy features they should have implemented a decade ago
The worst part is we’re all complicit. Every time we shrug and accept another subscription fee, every time we ooh and aah over incremental updates, we’re encouraging this behaviour.
Iteration Vs. Innovation
I still work with smaller companies that haven’t lost their souls yet. They’re out there, building actual solutions to actual problems. They’re not making headlines because they’re too busy doing the work.
The truth is that big tech has discovered a terrible secret: iteration is more profitable than innovation.
Google’s search results look increasingly like a digital mall where the highest bidder gets prime real estate. Microsoft’s Windows 11 feels less like an operating system and more like a subscription service with a side of operating system. And don’t even get me started on LinkedIn’s “AI-powered” features that somehow make networking feel even more artificial than before.
Tech companies are changing their focus from innovation to market share protection.
During a recent stint at a tech company, we had brilliant engineers working on groundbreaking projects, but every innovation had to pass through the “profit optimization filter.”
Great ideas died in Jira before they could take their first breath.
To top it all off, many of those brilliant engineers were later cut in ‘strategic restructuring’—corporate speak for layoffs that boost quarterly numbers.
The same teams working on breakthrough technologies were dismantled not because their projects failed but because their timelines extended beyond the next earnings call. I watched entire innovation departments get gutted while stock buyback programs continued uninterrupted.
Look, I’m not suggesting we return to the Wild West days of early Silly Con Valley. However, we need to recognize that the current model is unsustainable.
The Economic Cost of Prioritizing Profits Over People
When profit becomes the only metric for success, we don’t just lose innovation — we lose the innovators. We end up with a tech ecosystem that’s mile-wide but inch-deep, where job security lasts only as long as the following quarterly report.
You know it’s true!
According to Statista data, tech layoffs surpassed 160,000 jobs in 2022. By the end of 2023, that number had ballooned to over 250,000 jobs cut across more than 1,000 companies.
Big Tech has been at the forefront of this trend. Companies like Meta, Google, Amazon, and Microsoft collectively laid off tens of thousands of employees, often citing “economic uncertainty” or “strategic restructuring.”
Yet, during the same period, many of these companies reported billions in profits and continued to prioritize shareholder returns over long-term innovation.
These layoffs are a symptom of a broken system.
So What’s The Path Forward?
It starts with us — the users, developers, and dreamers who still believe tech can be more than just profits. We need to back companies that value real innovation, even when it doesn’t bring instant returns.
To make that possible, we first need to fix the incentive structure.
Companies discuss innovation KPIs, but nobody’s bonus is tied to breakthrough thinking. I’ve seen countless promising projects die because success metrics were tied to quarterly revenue instead of long-term impact. Want different results?
Change what you measure.
Second, we need to bring back the firewall between innovation and revenue teams. I’m not talking about Google’s old ‘20% time’ — that ship has sailed. I’m talking about dedicated teams with multi-year runways and protection from quarterly pressures.
When I talk about firewalls between innovation and revenue teams, I’m not suggesting we create ivory towers disconnected from reality. I’m advocating for protected spaces where good ideas can mature before they’re forced to justify their existence in a quarterly review.
Third — and this is important — we need to rethink board composition.
I’ve sat through hundreds of board meetings where not a single person had deep technical expertise in the company’s core technology. You end up with financial engineering instead of actual engineering. Every tech board should be required to have at least two members with relevant technical backgrounds.
And you’re right, expertise alone isn’t enough. But right now, we have the opposite problem: boards dominated by financial expertise with minimal technical understanding.
I’ve watched technical founders try to explain breakthrough potential to blank stares from board members who are more interested in EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) than innovation.
Finally, we need to rebuild the bridge between users and builders. Some of the best product decisions I’ve seen came from engineers who were active users of their own products. However, in most big tech companies today, the decision-making process is three layers removed from the actual product experience.
Can we fix this overnight? Of course not.
But I’ve seen enough companies — usually smaller ones — doing it right to know it’s possible. They’re proving that profitable innovation isn’t an oxymoron; it just requires the courage to think beyond the next earnings call.
The good news?
The talent and creativity are still there. They’re just waiting for leadership brave enough to unlock them.
Thank you for taking the time!
You can also follow me on LinkedIn and Medium.
I remember when Google started and it was so direct and correct, you could click I’m Feeling Lucky and get to where you wanted to go. That’s why Google won: they knew the link you wanted. And there were no ads.
Yeah.
Now the closest you can get is to ask AI to find the right link.
It's almost like what we see in the movie theatres: sequels, prequels, remakes, and nothing substantially new because they don't want to risk it and prefer to give the audience a general "nostalgia" feeling. We need new ideas. In every field!