Five new bills aimed at tethering Big Tech are in the US House Judiciary Committee before going to the House floor. To become law, they must pass through the House of Representatives, the Senate and, finally, signed-off by President Joe Biden.
Tethering Big Tech is a critical issue moving forward. It will ensure fair competition, kill off their somewhat monopolistic stature, and give the US ‘teeth’ to chase all tech breaking the rules.
The bills result from a 449-page report (it is a PDF) from the House Subcommittee on Antitrust, Commercial and Administrative law of the Committee on the Judiciary.
The Subcommittee found
- First, each platform now serves as a gatekeeper over a key channel of distribution. By controlling access to markets, these giants can pick winners and losers throughout our economy. They not only wield tremendous power, but they also abuse it by charging exorbitant fees, imposing oppressive contract terms, and extracting valuable data from the people and businesses that rely on them.
- Second, each platform uses its gatekeeper position to maintain its market power. By controlling the infrastructure of the digital age, they have surveilled other businesses to identify potential rivals and have ultimately bought out, copied, or cut off their competitive threats.
- And, finally, these firms have abused their role as intermediaries to entrench further and expand their dominance. The dominant platforms have exploited their power to become even more dominant through self-preferencing, predatory pricing, or exclusionary conduct.
Simply companies that once were scrappy, underdog start-ups challenging the status quo, have become the monopolies we last saw in the era of oil barons and railroad tycoons. Although these firms have delivered clear benefits to society, the dominance of Amazon, Apple, Facebook, and Google has come at a price. These firms typically run the marketplace while also competing in it. A position that enables them to write one set of rules for others while they play by another or to engage in the form of their quasi-private regulation that is unaccountable to anyone but themselves.
There is no doubt that the most prominent targets – Facebook, Apple, Amazon, and Google are the biggest targets. If the legislation gets up, then the rest of the tech industry will have to comply.
The report (paraphrased)
- Facebook had ‘monopoly power’ in the market for social networking. It maintained this by using its data advantage to ‘acquire, copy or kill’ nascent threats.
- Google monopolised online search and advertising using ‘a series of anti-competitive tactics’, including privileging its content ahead of other websites.
- Amazon possessed ‘significant and durable market power’ in online shopping. It furthered ‘anti-competitive conduct in its treatment of third-party sellers’, referred to as ‘internal competitors’ behind closed doors.
- Apple exerted monopoly power via its App Store. It leveraged ‘to create and enforce barriers to competition and discriminate against and exclude rivals while preferencing its offerings’.
Big Tech’s unchecked growth and dominance have led to incredible abuses of power. This has hurt consumers, workers, small businesses and innovation. That unchecked power ends now.
Robert Weisman, president of the advocacy group Public Citizen
The bills, which have received bipartisan backing from Democrats and Republicans, are:
- American Choice and Innovation Online Act – this bill prevents companies from manipulating marketplaces to promote their products
- Platform Competition and Opportunity Act of 2021. This bill makes it harder for companies to buy and kill off competitors
- Ending Platform Monopolies Act. This bill prohibits Big Tech monopolies from selling products in marketplaces they control
- Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act of 2021. This bill makes it easier to leave a social media platform and take your data to a competitor
- Merger Filing Fee Modernization Act of 2021. This bill allows the DOJ and FTC the resources they need to police monopoly power, at no cost to taxpayers
GadgetGuy’s take
Tethering Big Tech is far from over. FAANG has legal and lobbying resources that most first-world countries cannot match, including the US. Its first response is to drive a wedge between the Democrats and Republican’s supposed bi-partisan bill.
But these bills don’t go far enough. There is nothing in them to regulate what they do with our data – privacy. We wrote back in 2020 a widely read articles’ Big Tech needs even more extensive Digital Privacy regulation – ban data-harvesting (here) and ‘Privacy is the single greatest issue facing humanity’ (here).
We are heartened to see the bills. But it won’t cure the root of the evil – what Big Tech does with our data. If it did most other issues would go away as Big Tech could not operate in a private world.
