Big Tech’s Latest Threat: Antitrust Legislation

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Big Tech’s Latest Threat: Antitrust Legislation

By Christopher Vinson

Internet giants such as Facebook, Twitter, and Google have found themselves the subjects of increased political scrutiny. While much of the focus is on content moderation, the latest efforts from Congress aim to address a perceived lack of competition in the tech industry.[1] Large companies like Yelp have equally lamented the barriers to competition currently in the tech industry.[2] In a bipartisan effort on January 20, 2022, the Senate Judiciary Committee advanced the American Innovation and Choice Online Act.[3] Experts view this bill as the best opportunity for substantial legal reform in this area.[4] The advancement by the Senate Judiciary Committee will see the bill move to the full Senate for debate.[5]

The bill is designed to prevent self-preferencing by dominant platforms.[6] Self-preferencing occurs when platforms on their sites place or rate their products above similar third-party products.[7] Eliminating this tactic will prevent Amazon from placing their products at the top of search results or Google from rating their apps higher than similar third-party apps.[8]

Naturally, this effort has been met with stiff opposition from both industry leaders and commentators.[9] Critics of the legislation claim that Congress is moving too quickly without considering the ramifications of this bill.[10] Advocacy groups working for these large tech platforms believe additional hearings are necessary to gather more information.[11] In response, proponents have noted that this bill has been debated, researched, and marked-up extensively.[12] This is a delay tactic being implemented by large tech companies to prevent a vote on the bill.[13] The advancement of the bill out of committee demonstrates the Senate’s desire to enact meaningful antitrust tech legislation. Whether rushed or not, Congress should move quickly on issues they deem of major importance, especially considering the ever-present criticism that Congress moves too slow to enact legislation.

The CEOs of Apple and Alphabet, Tim Cook and Sundar Pichai, have worked tirelessly to convince Senators to vote against the bill.[14] For example, Tim Cook made direct phone calls to Senator Ted Cruz to lobby against the bill.[15] The main argument is that this bill may decrease consumer data privacy.[16] Apple’s Senior Director of Public Affairs, Timothy Powderly, claimed that the bill would open up serious risks of privacy due to security breaches.[17]

This is a legitimate concern and one that Senators shared during the debates in the Committee.[18] However, Senators Amy Klobuchar and Chuck Grassley pushed back against these claims saying that they distort the intention of the bill.[19] The bill requires changes to these platforms’ marketplaces, but Senators believe it will not have a serious impact on data privacy.[20] It will not make it more difficult for Apple to let consumers opt out of monitoring from apps.[21]

While increased competition is a worthwhile goal, commentators are concerned that antitrust policy in the tech industry may lead to the fracturing of services and increased costs for services that are currently low-cost or free.[22] There is also concern that it will disincentivize innovation and start-up companies by lowering potential acquisition costs.[23] These concerns preview a debate that may make the passage of this legislation difficult.

Additionally, several senators that ultimately voted to advance the bill expressed concerns about its language and potential effects.[24] It is very possible that these individuals will vote “no” if their concerns are not assuaged.[25] Furthermore, Senate leaders would need to make this legislation a priority.[26] This is no guarantee as the current focus has been on national voting legislation and filibuster reform. Nevertheless, this bill enjoys bipartisan support which bodes well in its quest for adoption.[27]

[1] Mark Sullivan, U.S. Senators Are Parroting Big Tech’s Anti-trust Talking Points, Fast Company (Jan. 21, 2022), https://www.fastcompany.com/90714797/big-tech-antitrust-objections-senators-klobuchar-grassley-bill.

[2] Lauren Feiner, Senate Committee Votes to Advance Major Tech Antitrust Bill, CNBC (Jan. 20, 2022, 12:54 PM), https://www.cnbc.com/2022/01/20/senate-committee-votes-to-advance-major-tech-antitrust-bill.html.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Id.

[10] Cristiano Lima & Aaron Schaffer, Tech Giants Say Antitrust Legislation is Being ‘Rushed.’ History Suggests Otherwise., MSN (Jan. 20, 2022), https://www.msn.com/en-us/news/politics/tech-giants-say-antitrust-legislation-is-being-e2-80-98rushed-e2-80-99-history-suggests-otherwise/ar-AASYeWe?ocid=BingNewsSearch.

[11] Id.

[12] Id.

[13] Id.

[14] Breck Dumas, Apple’s Tim Cook and Google’s Sundar Pichai Working Capitol Hill Together to Stop Big Tech Bill, Fox Business (Jan. 21, 2022), https://www.foxbusiness.com/politics/apple-tim-cook-google-sundar-pichai-working-capitol-hill-big-tech-bill

[15] Sullivan, supra note 1.

[16] Id.

[17] Id.

[18] Id.

[19] Sullivan, supra note 1; Lima and Schaffer, supra note 10.

[20] Lima and Schaffer, supra note 10.

[21] Dumas, supra note 14; Lima and Schaffer, supra note 10.

[22] Tracy Hernandez & Ahmad Thomas, Federal Antitrust Bills Threaten California Businesses Big and Small, OC Register (Jan. 24, 2022, 3:25 PM), https://www.ocregister.com/2022/01/24/federal-antitrust-bills-threaten-california-businesses-big-and-small/.

[23] Id.

[24] Feiner, supra note 2; Lima and Schaffer, supra note 10.

[25] Lima and Schaffer, supra note 10.

[26] Feiner, supra note 2.

[27] Lima and Schaffer, supra note 10.

Image Source: https://wacotrib.com/opinion/columnists/llewellyn-king-big-tech-should-be-left-alone-while-it-is-still-creating/article_c975f98c-4aee-11eb-88ff-9bb67d7ac293.html