Axios: Congress’ next moves to rein in Big Tech

August 6, 2020 Media

After grilling the CEOs of Amazon, Facebook, Google and Apple last week, members of Congress are grappling with whether to accuse any of the firms of illegal anticompetitive behavior, to propose updating federal antitrust laws — or both.

The big picture: Congress is just one arm of government making the case against these companies. Google is expected to be the first of the firms to face possible antitrust litigation from the Justice Department before summer’s end, but all four face a full-court press of investigations by DOJ, the Federal Trade Commission and state attorneys general.

What’s next: Following on from last week’s hearing, the House Judiciary antitrust subcommittee is preparing a report of its probe’s findings, drawn from some 1.3 million documents and hours of calls and interviews. Chair Rep. David Cicilline told Axios Re:Cap he hopes to issue the report and recommendations by late August or September.

The report may detail behaviors that investigators conclude harmed competition, as outlined in the hearing:

  • Facebook undertook its 2012 acquisition of Instagram in part because executives viewed it as a competitive threat, per internal communications uncovered in the probe.
  • Lawmakers also highlighted Amazon’s use of third-party sales data to develop its own products.

The lawmakers face two options:

  • They can argue that tech giants have violated antitrust law and lay out a legal case for breaking them up. That’s tough, as the case that the companies have monopolies remains fuzzy and none of them has driven up prices for consumers — two bars that successful antitrust cases are expected to pass.
  • They can make recommendations to update antitrust laws for the digital economy. That will require coming up with metrics of harm other than pricing effects, since so many digital products are free, and it will also call for definitions of markets that address the kind of power Amazon holds over third-party sellers or Apple holds over App Store developers.

What we’re hearing: Groups that advocate tough measures against tech companies want to see detailed legislative recommendations.

  • The Economic Liberties Project, for instance, wants new antitrust laws to set “bright-line” caps on how much market share any one tech firm can hold, executive director Sarah Miller told Axios.
  • The group also wants to see Congress require regulators to claw apart Amazon’s e-commerce platform from its storage and shipping business, per a letter to the House Judiciary committee Thursday also signed by several other groups including the Open Markets Institute, Demand Progress and The Institute for Local Self-Reliance.