The chief executives of four American tech groups faced accusations of wielding their companies’ size to unfairly squash competition on Wednesday, as they sat for an unprecedented grilling from lawmakers on Capitol Hill.
Amazon’s Jeff Bezos, Facebook’s Mark Zuckerberg, Apple’s Tim Cook and Sundar Pichai of Google’s parent company Alphabet were told their companies had “too much power” and were harming not just rivals but consumers.
Lawmakers pointed to internal emails and other evidence to zero in on Amazon’s treatment of third-party sellers on its platform — who compete in some cases with Amazon’s own products — and on Facebook’s acquisition of rival Instagram eight years ago — which eliminated a potential competitor — among a range of persistent antitrust questions.
The executives, by contrast, used the hearing to paint their companies — which have a combined market value of $5tn — as “uniquely American” success stories, directly creating more than 1m jobs in the country and enabling the prosperity of small and medium-sized businesses.
“Many of the practices used by these companies have harmful economic effects,” said David Cicilline, Democratic chair of the antitrust subcommittee of the House judiciary committee. “They discourage entrepreneurship, destroy jobs, hike costs, and degrade quality. Simply put: they have too much power.”
With the executives on video links to the House judiciary committee’s antitrust subcommittee, the high-stakes event was the first time all four chief executives have been involved in the same hearing. For Mr Bezos, it was the first time he had personally addressed Congress, 26 years after founding his company.
“It feels like just yesterday I was driving the packages to the post office myself, dreaming that one day, we might afford a forklift,” Mr Bezos told lawmakers.
Asked whether Amazon employees ever accessed data on third-party sellers to make business decisions about its own service or products, Mr Bezos said: “I can’t answer that question yes or no.”
He added: “What I can tell you is, we have a policy against using seller specific data to aid our private label business. But I can’t guarantee you that policy has never been violated.”
Mr Cicilline said third-party sellers had been “mistreated, abused and tossed aside”.
The subcommittee has for the past year been investigating an assortment of complaints about “Big Tech”, alongside similar probes from other agencies, including the US Department of Justice and the Federal Trade Commission, as well as the European Commission.
The committee does not have the authority to take any enforcement action against the companies. But it will seek to use its final report, due later this year, to inform possible changes to antitrust laws.
While concern over the power of Big Tech is considered a bipartisan issue, the two US political parties are at odds on the nature of the threat. Republicans at Wednesday’s hearing used the opportunity to rail against what they claim to be an anticonservative bias on the platforms.
“I’ll just cut to the chase, Big Tech’s out to get conservatives,” said Republican Jim Jordan, accusing the companies of censoring rightwing views.
Free speech arguments aside, the accusations across all of the investigations are broadly the same. Amazon, as the dominant ecommerce retailer, and Apple, as custodian of its highly lucrative App Store, are said to be onerous gatekeepers of their platforms — charging fees while favouring their own products in their respective marketplaces, utilising insights from data not available to outsiders.
Facebook and Google’s parent Alphabet are said to be using their dominant positions in social media and search to buy up smaller rivals in order to cement their position, as well as using the enormous reach of those networks to push consumers towards their own products, such as shopping services.
The early questioning in the hearing focused on Apple, Facebook and Google, with Mr Bezos escaping any attention from lawmakers for almost the first two hours.
Under questioning from Jerrold Nadler, a Democrat, Mr Zuckerberg acknowledged that Facebook’s $1bn acquisition of Instagram in 2012 was in part motivated by the photo-sharing platform’s growing popularity. The committee published a number of a documents detailing communications between Mr Zuckerberg and his staff regarding Instagram’s blossoming success.
“They certainly went from being a competitor in the space of being a mobile camera to an app that we could help grow,” Mr Zuckerberg said.
“This is exactly the type of anti-competitive acquisition that the antitrust laws were designed to prevent,” Mr Nadler said in response.
“This should never have happened in the first place, it should never have been permitted to happen, and it cannot happen again.”
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July 30, 2020 at 03:03AM
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Big Tech bosses told they have ‘too much power’ - Financial Times
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