Morning Consult: Big Tech Has Faced Antitrust Scrutiny. A Microsoft-TikTok Deal May Avoid Some of That

August 6, 2020 Media

Microsoft Corp.’s discussions about buying TikTok have thrown a wrench in the narrative that Washington antitrust hawks will automatically gawk at any and all mergers and acquisitions taken on by large U.S. technology companies. Some congressional aides and antitrust experts, in fact, say the potential deal could be one of the rare instances where Big Tech buying a smaller, fast-growing firm could instead spur competition.

Yet a handful of the traditional antitrust hawks are still raising concerns about whether Microsoft should be the suitor given its growing antitrust scrutiny in the European Union and dominance in the overall tech industry.

While Microsoft, whose market cap passed $1 trillion last year, hasn’t been part of the recent Washington scrutiny of market power within the technology industry, it hasn’t totally avoided controversy: Last month, Slack Technologies Inc. filed an antitrust complaint with the European Commission contending that Microsoft has tied its Teams workplace collaboration software to its Office products to force installation and make uninstalling it impossible. And more than 20 years ago, Microsoft nearly faced a breakup of its own after a court ruled that it had violated the Sherman Antitrust Act.

In a statement to Morning Consult, Sen. Elizabeth Warren (D-Mass.) said that while it’s important to make sure TikTok and other social media platforms aren’t used as a tool for foreign interference and disinformation, a deal such as Microsoft’s still shouldn’t skate by unchallenged.

“The federal government cheerleading and clearing the way for a giant tech company to acquire TikTok is inappropriate political interference in an already broken antitrust enforcement system,” Warren said.

But Matt Stoller, director of research at the American Economic Liberties Project, said that given the resources required to untangle TikTok from its Chinese parent company, only Big Tech is equipped to handle the job, underscoring its staying power in the industry.

“If we had a competitive market here, Vine could’ve been TikTok,” said Stoller, the author of “Goliath: The 100-Year War Between Monopoly Power and Democracy,” referring to the demise of the short-form video app owned by Twitter Inc.

“By rolling up all advertising and adtech, Google and Facebook made it impossible for any companies to come in without having massive access to capital and a protected home market, which is why the only competitor came from China,” he added.