Representative David Cicilline, the Democrat leading a high-profile investigation into technology giants including Facebook Inc and Amazon.com Inc is poised to deliver recommendations as soon as next month that will take aim at the power of digital behemoths and could lead to the overhaul of antitrust laws.
Cicilline said in an interview on Aug 26 that his inquiry has confirmed that Alphabet Inc’s Google, Apple Inc, Amazon and Facebook are abusing their market power to crush competitors and that Congress must act urgently to rein them in to protect consumers.
"All of these companies engage in behaviour which is deeply disturbing and requires Congress to take action,” said Cicilline, the chairman of the House antitrust panel. "The kind of common theme is the abuse of their market power to maintain their market dominance, to crush competitors, to exclude folks from their platform and to earn monopoly rents.”
Cicilline’s comments are the most extensive yet on where his committee is focused as it nears the end of its year-long investigation. While he declined to go into detail about the panel’s recommendations, Cicilline said he is working to find common ground with Republicans on the "biggest, boldest ideas I can.”
One possibility is what he described as a Glass-Steagall law for technology platforms. That Depression-era law separated commercial and investment banking until it was repealed during the Clinton administration. For tech companies, it would mean prohibiting them from running a platform and competing on it at the same time.
That’s a common complaint about Amazon in particular because it both runs a marketplace and competes with third-party sellers with its own line of products.
Cicilline declined to specifically endorse the idea of separating functions of platform companies, but said in a separate Bloomberg TV interview that it’s a "really interesting idea” that’s worth careful consideration.
"That’s a big idea,” he said about separating the two functions. "It would be one way to try to separate out what is a relationship fraught with conflicts that I think is promoting tremendous market dominance and bullying behaviour by Amazon, as an example.”
Representatives for Amazon, Facebook, Google and Apple didn’t respond to requests for comment. The companies have defended their conduct as good for consumers and say they face fierce competition across their businesses.
Cicilline said the House antitrust panel intends to issue its report as soon as September, which would allow him to offer legislative proposals in this session of Congress.
The committee, which collected more than one million documents in its investigation, concluded its hearings in July with testimony from the chief executive officers of the four tech companies. Cicilline said he was struck by the "casual way” Facebook CEO Mark Zuckerberg acknowledged that he acquired messaging service WhatsApp in 2014 because it was a growing competitor. Cicilline said he was also surprised that Amazon’s CEO Jeff Bezos wasn’t able to answer whether the company had used the data of rivals that sell goods on Amazon’s platform to inform its own product development.
"They sort of acknowledged a set of business practices that were anti-competitive, deeply disturbing, and either kind of evaded the answer completely, or didn’t really have an explanation for their conduct,” he said.
The committee’s report will address four broad areas, Cicilline said: changes to existing antitrust laws passed more than a century ago; reforms aimed specifically at the tech sector; strengthening private antitrust litigation by plaintiffs; and ensuring antitrust watchdogs at the US Justice Department and the US Federal Trade Commission have the resources to do their jobs and are staffed by aggressive enforcers.
Cicilline is highly critical of the Justice Department’s and FTC’s track record on antitrust enforcement. Officials in Republican and Democratic administrations haven’t done enough to curb the power of dominant companies, he said. The FTC, in particular, shouldn’t have approved Facebook’s acquisition of WhatsApp, he said.
But even with tougher enforcement by the FTC and the Justice Department, Cicilline said his "gut” is that Congress still needs to update antitrust laws to address court decisions that have made it tougher to win cases and have led to dominant companies that are thwarting competition.
"It’s actually up to Congress to decide what the appropriate antitrust policy is for the country, not the courts,” he said. "And to the extent the courts have interpreted things that we think are inconsistent with good competition policy, that’s the exact function of the investigation and of policymaking that Congress is responsible to do. So that’s exactly what we need to look at.”
- Bloomberg
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024