MY TAKE: From AOL-Time Warner to OpenAI-Amazon — is the next tech bubble already inflating?

Anyone remember the dot-com bubble burst? The early warning came in January 2000, when AOL and Time Warner joined forces in a $164 billion deal — the largest merger in U.S. history at the time.

Related: Reuters’ backstory on Amazon laying off 30,000 corporate staffers.

Steve Case and Gerald Levin proclaimed themselves the new emperors of e-commerce. Within two years, the merged company imploded.

Fast forward a quarter century to Nov. 3, 2025. OpenAI — the breakout engine behind ChatGPT — inks a five-year deal committing $38 billion to Amazon Web Services. In just three years, OpenAI has gone from scrappy upstart to the de facto infrastructure layer for generative AI development.

The OpenAI-AWS deal signals a broader alignment of Big Tech giants — Microsoft, Amazon, and others — consolidating around OpenAI’s model as the model. We’re past the disruption phase. This is platform lock-in. The gold rush is officially underway.

It feels like 2000 all over again — but something is profoundly different this time.

The winners of the e-commerce boom are now bulldozing their way into AI — not to build a better future, but to entrench control. This time, they’re setting the terms from the outset: shaping rules to fit their designs, locking in dependencies, and racing ahead of regulators before the guardrails can go up.

The dot-com bubble

The dot-com boom wasn’t just about excitement — it was about suspended disbelief. In late 1999, any company with a “.com” suffix — no matter how flimsy the business plan — could attract venture capital and debut with a triple-digit IPO pop.

In 1999 alone, 457 companies went public, many with no profits or revenue. IPOs averaged a 71% first-day gain. Venture capital poured in: $105 billion across internet startups between 1998 and 2000. Some of the loudest names — Pets.com, Webvan, eToys — burned through ad budgets and bought Super Bowl spots before figuring out basic logistics.

The underlying idea wasn’t wrong: the internet would revolutionize commerce. But infrastructure lagged — dial-up was slow, logistics immature, customer trust thin. Timing killed the vision.

When the Nasdaq peaked in March 2000 and crashed soon after, the correction was swift and brutal. By late 2001, more than half of all internet startups had folded. Trillions in paper wealth vanished. The AOL-Time Warner merger unraveled. And tech entered a multi-year reputational winter.

Still, something important remained: the idea of e-commerce. Amazon survived. eBay survived. So did infrastructure players like Cisco, Intel, and Akamai. And from the rubble emerged a small circle of survivors — not necessarily the most visionary, but the most relentless. They moved fast, scaled ruthlessly, and played the game with fewer scruples and sharper instincts. In the vacuum that followed, they consolidated power — controlling the capital, the infrastructure, and the rules of the road.

The GenAI bubble

Fast forward to 2025, and the energy feels eerily familiar.

This time, it’s not about e-commerce websites — it’s about “AI-native” everything. Investors are flooding early-stage ventures: personalized shopping bots, songwriting assistants, synthetic board advisors. But this isn’t just a bet on new markets. It’s a scramble for control of the next interface.

Everyone wants to own the “default” — the go-to assistant, the always-on agent, the gatekeeper of attention and workflow.

Take Viven, a San Francisco startup that just raised $35 million to create AI “digital twins” of employees. The pitch: let teams query synthetic versions of colleagues, trained on internal documents and habits. Critics raise flags about privacy, reliability, and organizational sprawl — but the funding shows the appetite is real.

On the consumer side, TikTok and YouTube are flooded with ads for AI art tools, ghostwriting bots, avatar generators, and SEO-optimized video factories. Many are just glossy wrappers around the same large language model APIs. Monetization is secondary. First comes growth and grip.

OpenAI arises

OpenAI is arguably the most powerful player in the generative AI surge — and it’s no longer just a nonprofit research outfit. After a reported $13 billion investment from Microsoft, the company has vaulted to a private valuation north of $500 billion. According to  Reuters reporter Krystal Hu, that figure isn’t based on current profits. Instead, it reflects investor bets on how much revenue OpenAI might generate down the line — and how quickly Microsoft can recoup its investment.

Under their deal, Microsoft gets a slice of OpenAI’s future earnings, capped once it reaches a set return. It’s a structure that looks more like a high-stakes startup deal than a traditional nonprofit mission — and it speaks volumes about how blurred the lines have become.

That staggering figure reflects more than just hype.

OpenAI now anchors all three lanes of AI commerce: consumer usage (via ChatGPT), enterprise infrastructure (through Azure and API integrations), and developer ecosystems. Its rise echoes the early dominance of platforms like Windows or AWS — the systems others are racing to build atop.

And now, Amazon wants in. The $38 billion partnership — centered around AWS, chip integration, and Anthropic — lands like the final big-money trigger that could mark the peak of this AI gold rush. It’s a moment with real parallels to March 2000, when AOL’s mega-merger briefly crowned the dot-com bubble — just before it burst.

Power consolidation

The first dot-com wave was chaotic and wide open: full of garage startups, bad bets, and accidental unicorns. But it ended with a few dominant winners — Amazon, Google, Apple, Meta — who built the platforms, wrote the rules, and reaped decades of compounding returns.

This time, those same players are already at the starting line — not as challengers, but as incumbents rerouting the rivers.

OpenAI’s Microsoft partnership — and now its AWS deal — isn’t a sideshow. It’s the stack consolidating in real time. Microsoft has embedded GPT into every corner of its enterprise suite: Word, Excel, Teams, Outlook, Azure. It’s positioning itself as the default AI productivity layer for the decade ahead. Amazon, meanwhile, is scrambling to keep AWS relevant — betting on Anthropic and building its own GenAI tools to preserve cloud lock-in.

This isn’t about building the future. It’s about owning it in advance.

A darker edge

The power consolidation is already showing its darker face.

Instead of rebuilding thoughtfully, the giants are cutting deep — tens of thousands of white-collar jobs gone, even as they promise AI-fueled growth. Amazon alone is reportedly slashing up to 30,000 corporate roles, nearly 10% of its office workforce. According to Reuters, the cuts aren’t about short-term losses or AI displacement — they’re about reshaping Amazon’s culture to move faster, strip layers, and automate more. Some workers were reportedly ousted for not showing up in person — with no severance.

Microsoft, meanwhile, plans to eliminate 9,000 positions, even as it ramps up Copilot deployments across its product line. The message from CEO Satya Nadella isn’t subtle: this new era runs leaner — and if you can’t adapt to the stack, you’re out.

At the same time, the soft guardrails of tech ethics are quietly being dismantled.

Meta disbanded its “Responsible AI” team — once positioned as a central force for internal oversight — folding the unit’s work into other departments. Around the same time, Google quietly broke up its own Responsible Innovation team, shifting staff elsewhere after the departure of its leader.

That Google team had been charged with evaluating AI systems for harm before launch — a mandate that now appears defanged. Publicly, both firms continue touting their commitment to “ethical AI.” Internally, they’ve dismantled the very groups that were tasked with making that promise real.

A power grab

Regulators, too, are struggling to keep pace. Civic groups working to shape AI norms are being outmaneuvered by PR campaigns and high-level lobbying. Innovation churn is becoming a moat — for those who already own the land.

This isn’t an open field of innovation. It’s a consolidation of power, layered atop entrenched platforms with war chests, global infrastructure, and insider access to rulemaking. The risks aren’t just speculative — they’re structural. As the tech giants shift from builders to gatekeepers, the giveaway is no longer the humble promise of improvement, but accelerated automation, thinner oversight, and a civic domain that increasingly serves at the pleasure of platform interests.

Change is arriving fast. I’ll keep watching. And I’ll keep reporting.

Pulitzer Prize-winning business journalist Byron V. Acohido is dedicated to fostering public awareness about how to make the Internet as private and secure as it ought to be.

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(Editor’s note: I used ChatGPT-4o to accelerate and refine research, assist in distilling complex observations, and serve as a tightly controlled drafting instrument, applied iteratively under my direction. The analysis, conclusions, and the final wordsmithing of the published text are entirely my own.)

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