Big tech vs Congress

Alphabet, Amazon, Apple, and Facebook bosses face five-and-a-half hour grilling in Washington D.C. court

Photo by hellcrisis_619 on Flickr.

4 minute read — by Camilla Foster

After a year-long investigation, the House Judiciary Antitrust Subcommittee, part of the U.S. Congress, confronted Jeff Bezos, Tim Cook, Sundar Pichai and Mark Zuckerberg, over enduring concerns that their respective companies had become too powerful.

The inquiry also addressed the economic implications of the companies’ perceived anti-competitive practices, such as unfairly promoting their own products and services above others. Big tech companies have been accused of using their dominance to shake down small businesses and enrich themselves by closing off the market.

Leading Congressman, David Cicilline, began the hearing stating “founders would not bow before a king, nor should we before the emperors of the online economy”, outlining the immense power of these tech titans.

Amazon controls 38 percent of the e-retail market and has been accused of promoting its own products over sellers. The former partner of Bezos drew parallels between the trillion-dollar company and a drug dealer. The metaphor “Amazon heroine” was used to vividly depict how smaller businesses’ eagerness for “the next fix” (i.e. the next cheque) evidently has led to their downfall. There is a prevalent inherent conflict of interests, as it hosts third-party sellers and actively competes against them by offering similar products. This anti-competitive practice has come under scrutiny from European regulators in recent years.

Tim Cook, CEO of Apple, received less questions than his counterparts, but the App Store was depicted as a gatekeeper that ferociously overcharges its consumers and denies rival companies like Spotify any fair competition. Apple controls 46 percent of the mobile software operating market and takes a 30 percent cut of sales on its App Store. Cook argued that the fee is essential as it funds the entire app ecosystem and pointed out Apple had not raised its rates since the store’s opening in 2008.

Google, which belongs to parent company Alphabet, controls around 90 percent of the search market and has been fined for burying its competitors in searches. Lawmakers have previously accused Google of stealing content created by smaller firms, like Yelp, in order to keep users on their own web pages. Pichai, CEO of Google, disputed this menace characterisation reinforcing the good it does in the world: “today, we support 1.4 million small businesses, supporting over $385 billion in their core economic activity”.

Facebook faces ongoing criticism and concerns over content moderation and its aggressive acquisition strategy. Zuckerberg’s company once again was under fire from Congress for violating consumer’s privacy and data. This conference follows the Cambridge Analytica scandal in 2018 whereby millions of Facebook users’ personal data were harvested without consent and then targeted by political advertisers. This scandal is believed to have contributed towards the 2016 presidential election result.

Big tech faces cynicism from both sides of the political aisle. Democrats are worried about competition issues whereas Republicans focused on the use of data and the apparent marginalisation of conservative views. There was an underlying urge to break up and de-centralise the power of these companies to allow more healthy competition in the tech industry.

President Trump is a long time critic of Amazon and took to Twitter to threaten executive action: “if Congress doesn’t bring fairness to Big Tech, which they should have done years ago, I will do it myself with Executive Orders”. This stance contrasts with Trump’s previous political ethos, as he is usually dubbed a friend of transnational corporations and an advocate for deregulation. Criticism towards Trump from the Washington Post, a newspaper owned by Bezos, may have sparked personal grievances between the two billionaires. Beyond Trump, there are growing political concerns and a general distrust of the power of big tech companies within Washington.

All companies deny using their dominance to stifle competition. The Committee promises another report later this summer, or in early autumn. Jeff Bezos, CEO of Amazon, was hauled infront of congress for the first time. He confidently made a robust defence stating that the “world needs large firms” as tech companies spur innovation and evoked the humble beginning of his company.

This conference illustrates the two competing narratives in the controversial tech debate. On one hand these tech companies are viewed as American success stories that are vital contributors to the economy. On the other-hand, congress represent the current concern of this dominance, viewing these companies as a threat to America and the values for which it stands: dynamic markets, transparency, democracy and trust.