Why do so many layout announcements follow a similar script from American public media?

This is Marketplace Tech.

I'm Megan McCarty-Carrino.

The Mayacolpas from Tech CEOs announcing massive job cuts have become a familiar refrain.

We hired too many people.

We were much too optimistic.

This did not play out the way I expected.

That was a mash-up of statements from Salesforce, Stripe, and Meta.

The tech industry continues to shed jobs.

Google and Microsoft announced thousands of layoffs last week, Spotify, hundreds this

week.

So, why did so many tech companies make the same mistake of overhiring?

Anup Srivastava is a Canada research chair and professor at the University of Calgary.

He says going big during boom times is baked into the business model of the industry.

It's a winner takes all.

There is only one link it in, there's only one Facebook, there's only one Google.

That's a network effect.

So you have to become big and capitalize on so-called winner takes all profit structure in

order to make money.

So they were buying lottery tickets, they were experimenting.

The party has come to a stop.

Right, during the good times it really felt like there was such a competition to expand

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