November 30, 2020

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Tech titans hammered by Congress in historic antitrust hearing

Four of America’s richest and most powerful tech leaders faced a grueling audience before the US House of Representatives’ antitrust subcommittee Wednesday, with each facing harsh questioning about their alleged predatory business practices, theft of small companies’ digital content and aggressive copying and purchasing of competitors.

In many cases, these CEOs were left to reject completely the premises of the questions since they presented their businesses as either monopolistic, wholly ruthless or both. Lawmakers, however, showed up with receipts, presenting internal company emails and interviews from smaller companies to back their claims. 

The hearing, held virtually amid the coronavirus outbreak, is the culmination of a 13-month investigation by a House subcommittee’s into Big Tech’s dominance. The four CEOs  — Facebook’s Mark Zuckerberg, Amazon’s Jeff Bezos, Apple’s Tim Cook and Alphabet’s Sundar Pichai — are speaking before Congress for the first time as a group, and Bezos is attending his first ever public hearing.

If the tenor of the questions offers any indication the House committee’s plans, it appears the committee is looking to find new ways to regulate these tech giants, seeing them as stomping on the invisible hand of the free market. A report from the committee, which will synthesize the results of six hearings and more than 1.3 million documents, was delayed due to the pandemic but is expected sometime this year. 

The bitter tone of the hearing is hardly surprising, since most of these types of events cater to grandstanding and political point scoring more than fact-finding. In this case, lawmakers used their five minute rounds of questioning to make speeches to the CEOs and often interrupted the witnesses when answering, which of course helped these lawmakers avoid having the CEOs filibuster.

In his opening statement, US Rep. David Cicilline, a Democrat of Rhode Island, raised concerns that Big Tech could consolidate power even more that it has now during the coronavirus pandemic, as smaller businesses have been left reeling. He said it was important to confront monopoly power so it doesn’t crush other businesses.

“Our founders would not bow before a king, nor should we bow before the emperors of an online economy,” said Cicilline, the chairman of the subcommittee.

On the other side of the aisle, Rep. Jim Jordan, a Republican of Ohio, raised concerns about alleged anti-conservative bias by major tech platforms, including Twitter censoring President Trump’s tweets. “I’ll just cut to the chase,” he said. “Big Tech is out to get conservatives.”


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An hour into the hearing, these different perspectives were repeated as Republicans pushed concerns about online censorship, particularly of conservative voices, and Democrats complain about potential monopolistic practices. Republicans have repeatedly expressed support for business, saying big and successful companies aren’t necessarily bad.

Bipartisanship — hard to come by in Washington — was clearly evident. Both Cicilline and Republican Ken Buck of Colorado, accused Google of stealing digital content from smaller companies, such as Yelp and Genius. In the case of Yelp, Cicilline said Google threatened to delist it when Yelp raised concerns.

“The choice Google gave Yelp was let us steal your content or effectively disappear from the web site isn’t that anti competitive?” Cicilline asked in a pointed and forceful line of questioning.

Somewhat sheepishly, Pichai avoided a direct answer, saying: “When I run the company, I’m really focused on giving users what they want. We conduct ourselves to the highest standard. Happy to engage, understand the specifics, and answer your questions further.”

While each CEO faces different sets of concerns, their prepared opening remarks, which were published Tuesday night, provide strikingly similar defenses of their organizations. The CEOs said their companies face many competitors, create American jobs and benefit small businesses and consumers.

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In an unprecedented hearing during coronavirus, all four tech CEOs appeared remotely via Cisco Webex for the event.


Via House Judiciary

Bezos offered a defense of massive companies, saying they are uniquely able to do big, complex tasks. “I don’t care how good an entrepreneur you are,” he wrote, “you’re not going to build an all-fiber Boeing 787 in your garage.”

And even with Facebook’s current dominance, Zuckerberg wrote that he expects another service will eventually become more popular. “I’ve long believed that the nature of our industry is that someday a product will replace Facebook,” he said. “I want us to be the ones that build it, because if we don’t, someone else will.”

The event, delayed by about an hour because an earlier hearing ran long, is a rare public interrogation of Big Tech’s most influential leaders at a point of great upheaval. The pandemic has changed how many Americans live, forcing them to lean on the companies to work and shop from home, as well as communicate with loved ones. The hearing will likely touch on Big Tech’s ability to shape public opinion, a topic that has taken on new urgency with a contentious presidential election roughly three months away and continued protests over racial injustice. 

The committee worries the four companies have become so powerful that they can stifle competition and prevent innovation by acquiring or copying rivals. The committee could recommend new regulations of Big Tech or, in an unlikely outcome, breaking up the companies.

The committee isn’t alone in its concerns. President Donald Trump, who has repeatedly claimed Silicon Valley stifles conservative voices, tweeted that he would take action to curb Big Tech’s power if Congress didn’t.

“If Congress doesn’t bring fairness to Big Tech, which they should have done years ago, I will do it myself with Executive Orders,” Trump tweeted.

Trump has already issued an executive order that is widely seen to target Twitter, which isn’t testifying at the hearing, and threatened to ban TikTok, a popular Chinese video app. (On Wednesday, Steve Mnuchin, the treasury secretary, said that TikTok was under a national security review.)

By any measure, the power of the four companies, which are worth roughly $5 trillion combined, is vast. Facebook, the world’s largest social network, has roughly the same number of users as the populations of the two largest countries, China and India, combined. Amazon controls 38% of US online sales, more than six times the size of Walmart’s US web business, its nearest competitor. Apple’s App Store is the only way for most developers to get their software onto the huge iPhone and iPad customer base, and Apple takes a cut of those installations. Google has a lock on search, processing about 90% of all web searches around the world.

The CEOs are expected to address separate antitrust concerns. With Facebook, regulators are looking into the company’s acquisitions of competitors like Instagram and WhatsApp. For Amazon, Congress has largely focused on the company’s private-label business, which sells Amazon brands of clothing, food and diapers. Apple has seen scrutiny over the cut it takes from software developers on its app store. For Google, regulators are focused mainly on the search giant’s dominance in digital advertising.

The tech leaders and their companies also represent staggering personal wealth. Bezos is the world’s richest man with a personal fortune estimated at $181 billion. Zuckerberg is the fourth wealthiest, with $86 billion. Though not testifying, Google co-founders Larry Page and Sergey Brin are $68 and $66 billion each.

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