Bills Make It Easier For Govt To Break Up Dominant Companies & Prevent Them From Snuffing Out Competition Through Preemptive Acquisitions.

By Joan E. Solsman

US Lawmakers Unveiled A Wide-Ranging Antitrust Agenda Friday, Aiming To Rein In The Competitive Power Of Giants Like Amazon, Apple, Facebook And Google. The five bipartisan bills, the result of more than a year investigating competition in the digital marketplace, target what lawmakers call the “unregulated power wielded” by Big Tech.

The bills are aimed at the four tech titans, which collectively influence almost every aspect of online life, as well as the broader industry. If eventually passed into law, the bills would make it easier for the government to break up dominant companies and prevent them from snuffing out competition through preemptive acquisitions. Rep. David N. Cicilline, a Rhode Island Democrat and chairman of the House Antitrust Subcommittee, said the slate of bills would “level the playing field” and ensure tech companies were held to the same rules.

“Right now, unregulated tech monopolies have too much power over our economy,” Cicilline said in a press release. “They are in a unique position to pick winners and losers, destroy small businesses, raise prices on consumers, and put folks out of work.” Facebook and Google declined to comment. Apple and Amazon didn’t respond to messages seeking comment.

The immense market power of these companies, which together represent more than $6 trillion in market value, has confounded the basic principles that guided antitrust legislation in the US for a generation. Lawmakers have become increasingly concerned by the industry’s behavior and threatened to address it. In July, the chief executives of the four companies were hauled in front of Cicilline’s committee for a grueling six-hour hearing, an unprecedented public interrogation of Big Tech’s most visible leaders. 

Silicon Valley’s supporters argue the scale of Apple, Amazon, Facebook and Google has provided consumers with unprecedented innovation and sweeping technological benefits, often at lower cost. Critics of Big Tech counter that the industry’s extraordinary market power harms workers, suppresses smaller rivals and costs consumers in ways other than money.

The bills in Friday’s legislative agenda, according to lawmakers, would:

  • Prohibit discrimination by dominant platforms — such as Apple’s App Store, the Google Play Store or all of Amazon’s marketplace — preventing them from exercising self-preference or “picking winners and losers online.”
  • Forbid acquisitions designed to squelch competitive threats, or those that would expand or entrench the market power of online platforms.
  • Restrain dominant platforms from leveraging their control across multiple business types to give themselves unfair advantage and disadvantage competitors.
  • Promote more online competition by lowering barriers to entry and reducing the costs to businesses and consumers when they want to switch to a new provider.
  • Update filing fees for mergers, the first increase in two decades, providing funds for both the Department of Justice and the Federal Trade Commission to pursue necessary antitrust action.

The US isn’t alone in curbing the powers of technology companies. Three years ago, the EU enacted comprehensive laws called the General Data Protection Regulation, or GDPR, which are widely seen as a global gold standard for privacy. Australia requires tech companies to pay for news content linked to on their sites. China and India have also gone after tech companies. The new bills escalate a fight that’s been brewing between Silicon Valley and Washington for years.

All four of the tech giants face major antitrust battles. Google is the target of three major antitrust lawsuits, including a landmark case filed by the US Department of Justice, and another complaint from a bipartisan coalition of states. Facebook faces lawsuits from the Federal Trade Commission and a group of state attorneys general. Amazon has been sued by the attorney of Washington, DC, for price fixing. Apple and Google have been sued by the maker of the popular game Fortnite for their app store policies.

Cicilline has led the charge in the House. July’s hearing was the culmination of a more-than-yearlong investigation by his subcommittee into the market dominance of the tech giants. During that time, the subcommittee gathered more than 1.3 million documents from the tech companies, their competitors and antitrust enforcement agencies. Following the hearing, the subcommittee released a 449-page report accusing the four companies of “abuses of monopoly power.”

The sizes of the companies are staggering.

Facebook is the world’s largest social network, with a user base roughly equal to the world’s two most populous countries — China and India — combined. Amazon controls 38% of US online sales, while Walmart, its nearest competitor, has just shy of 6%. (Amazon also collects data on other retailers using its giant platform.) Apple’s App Store is a powerful gateway for software developers to find an audience with the company’s massive iPhone and iPad customer base. Google processes about 90% of all web searches globally.

The legislative package is a “huge step” toward holding dominant tech companies accountable for abuses of their unchecked power, said Robert Weissman, the president of consumer advocacy group Public Citizen. “Big Tech should see this for what it is: Congress sending a clear message that the party is finally over for them,” he said in a statement.

Smaller competitors lauded the move.

Roku, which is currently in a standoff with Google over a deal to keep hosting the YouTube TV app on its streaming devices, called the bills a crucial step to curbing predatory behavior. “Roku has firsthand experience competing against and interacting with these monopolists,” the company said in a statement. “We’ve seen how they flagrantly ignore antitrust laws and harm consumers by leveraging their dominance in one line of business to stifle competition in another.”

Spotify, which has been a vocal critic of Apple’s actions in its App Store, called the proposals a “clear sign that momentum has shifted” after “anticompetitive practices have gone unchecked for too long, stifling competition and threatening innovation.” Supporters and representatives of the tech industry, however, warned that the bills could hurt US economic leadership in the world and hamper consumers’ access to free digital services.

“The House bills would put the government in charge of industrial organization,” Matthew Schruers, the president of tech trade group Computer & Communications Industry Association, said in a statement. “They disregard the principles that have governed the US market economy and would stop successful tech companies from providing consumers with the products and services that improve their lives.”

A statement earlier in the day by Rep. Ken Buck, a Colorado Republican who is the ranking member of the committee, suggested the industry’s position would find little sympathy in Washington. “Big Tech has abused its dominance in the marketplace to crush competitors, censor speech, and control how we see and understand the world,” Buck said. “Doing nothing is not an option, we must act now.”

This news was originally published at CNET.