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Amazon, Apple, Google and Facebook have abused their market power according to a damning report from Congress that recommended forcing large tech companies to restructure their businesses entirely.
A 449-page report released Tuesday by the Democrat-controlled House antitrust subcommittee amounts to a rationale and a roadmap for what would be the biggest assault on corporate power in the tech industry since the decade of 1990.
The report said: “By controlling access to markets, these giants can pick winners and losers across our economy. Not only do they wield tremendous power, they also abuse it by charging exorbitant fees, imposing oppressive contract terms, and extracting valuable data from the people and businesses that depend on them.
The report suggests ending these practices by rewriting US antitrust law, for example, forcing companies to restructure so that they cannot use their dominance in one area to harm rivals in another. Business lines must be divided and kept under separate management, if not sold.
And it requires regulators to presume that any proposed takeover by a dominant company is anti-competitive unless it is proven to be not.
While Republicans do not support these recommendations, Democratic officials hope Joe Biden will seriously consider it if he wins the November presidential election. A new Congress could also address them in whole or in part.
Republicans on the subcommittee supported some of the report’s less controversial proposals to increase enforcement of antitrust laws, but declined to sign the report in its entirety.
The committee’s Democratic staff spent 16 months compiling its findings, interviewing 250 people and studying more than 1.3 million documents in the process.
They conclude that each of the four largest tech companies had unfairly stifled competition in different ways.
He said Facebook had “maintained its monopoly through a series of anti-competitive business practices,” including buying off potential rivals and drafting its policies to benefit its own services while suffocating others.
He found that after the company’s acquisition of Instagram in 2012, the combined company became so large that it ended up largely competing with itself rather than others in the market.
And it revealed an internal research article, dubbed the Cunningham Memo, advising CEO Mark Zuckerberg in October 2018 how the company could continue to grow on both Facebook and Instagram without one reaching a “tipping point” where all users would be needed. of the other. A senior Instagram executive described the approach as “collusion, but within an internal monopoly.”
The report went on to accuse Google of using some of its services to promote others. For example, the company required that smartphone makers using Google’s Android operating software install their Chrome web browser as standard. Chrome, in turn, uses Google as its default search engine.
Supporters of big tech companies often say aggressive tactics to beat competition have improved services for users rather than worsened them.
But the report describes how Google manipulated its search engine to highlight its own products, such as its shopping service, when those services normally would not have ranked high in Google search.
He quotes a company employee who says of their shopping service: “We would probably have to give this content special treatment to make it crawl, index and rank well.”
The Trump administration’s justice department is already finalizing an antitrust lawsuit against Google in concert with several state attorneys general.
Some of the findings of the subcommittee’s investigation were followed up in a public hearing earlier this year when the CEOs of Facebook, Google, Amazon and Apple sat for an all-day barbecue.
At Amazon, the report finds that sellers using the Amazon marketplace felt unable to protest the company’s fees and policies because they relied heavily on its services, and alleged that the company routinely uses data from third-party sellers to help improve and sell your own products. .
Amazon has promised not to use this data for competitive reasons, but a former employee is quoted as saying: “It’s a candy store, everyone can have access to whatever they want. There is a rule, but nobody enforces it or verifies it. They just say, don’t help yourself with the data. . . it was ‘wink wink’, please don’t log in. “
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On Apple, developers told the subcommittee that the iPhone maker uses its dominant App Store to benefit its own applications and to hinder those created by rival companies.
In a statement, David Cicilline, the head of the subcommittee, and Jerrold Nadler, the Democratic chairman of the House judicial committee, said the evidence “demonstrates the urgent need for legislative action and reform.”
“These companies have too much power, and that power needs to be controlled and properly monitored and enforced. Our economy and democracy are at stake ”.
Additional information from Kadhim Shubber in Washington
