Morning Consult: Tech Antitrust Groups Have a New Target: Food Delivery Apps
Some of the most prominent national groups on antitrust and the tech industry are turning their attention to a quartet of new targets: Grubhub Inc., Uber Eats, Postmates Inc. and Doordash Inc.
In a new campaign called “Protect Our Restaurants,” the American Sustainable Business Council, the American Economic Liberties Project and the Institute for Local Self-Reliance are calling on the Federal Trade Commission to investigate the four most dominant food delivery apps and their treatment of restaurants, which have become highly dependent on these services during the pandemic.
“The delivery apps have raked in billions by copying Amazon and brazenly flouting antitrust laws,” Sarah Miller, executive director of the American Economic Liberties Project, said in a statement. “Their business is one built on the extortion and exploitation of restaurants, workers, and consumers. It’s time policymakers at all levels of government take action.”
Since the coronavirus shut down most of the United States in March, food delivery apps such as Grubhub, Uber Eats, Postmates and DoorDash have seen an uptick in demand and secured staying power in the tech industry as more restaurants cling to their services during the pandemic. During the second quarter, while Uber Technologies Inc.’s gross ride-hailing bookings were down 73 percent year over year, demand for its food delivery service shot up 113 percent in the same period. And Uber said last month it planned to acquire Postmates in a $2.65 billion all-stock deal, which would give Uber-Postmates 35 percent of the food delivery app market share — superseded only by DoorDash at 45 percent, according to a May report from Edison Trends.
However, each of these companies has been accused by restaurant owners and groups of crippling their businesses after taking as much as 30 percent of the order’s total for commission and delivery fees, although food delivery apps have argued that they, too, are also trying to find a way to make money from their services and that a cap limits their delivery capabilities. In response, some cities, including San Francisco, Seattle and Washington, D.C., have implemented emergency orders to cap commissions at 15 percent.