Antitrust Bill Targets Big Tech For Preferential Treatment Given to Their Own Products
WASHINGTON — The Senate Judiciary Committee approved antitrust legislation Thursday that bans Big Tech from giving a preference to their own products and services on their internet platforms.
The American Innovation and Choice Online Act responds to criticism that Amazon, Apple, Google and Meta Platforms Inc.’s Facebook have gotten so big and powerful no one can compete with them. It also set off warnings from the industry about the consequences for consumers.
Amazon is saying it could jeopardize its Prime service’s ability to deliver products next-day or within two days.
Google says losing control over its services like Gmail and YouTube would make it easier for hackers to tap into users’ personal accounts.
Apple says government oversight, if the legislation is passed, would threaten the privacy of its customers.
Apple dominates the market for apps on its mobile phones. Customers must go through the company’s app store to download apps.
Apple says the app store allows them to maintain security. Otherwise, customers could be subjected to hackers and scams if they download directly from the internet.
The political will in Congress to rein in Big Tech grew after the FBI revealed the Russians posted propaganda on Facebook to influence the 2016 presidential election in favor of Donald Trump. More momentum for the American Innovation and Choice Online Act came from evidence domestic extremists used social media to organize the Jan. 6, 2021, insurrection at the U.S. Capitol.
In addition, Amazon was accused of shutting out competition on its internet marketplace when it offered products that were similar to other companies.
Lawmakers said the American public was compelled to tolerate decisions by a few corporate executives about how they use the internet.
Big Tech competitors supporting the bill include Yelp Inc. and Sonos Inc.
The American Innovation and Choice Online Act was sponsored by Sen. Amy Klobuchar, D-Minn., who chairs the Senate Judiciary subcommittee on competition policy, antitrust and consumer rights.
“American prosperity was built on a foundation of open markets and fair competition, but right now our country faces a monopoly problem, and American consumers, workers, and businesses are paying the price,” Klobuchar said in a statement. “As dominant digital platforms — some of the biggest companies our world has ever seen — increasingly give preference to their own products and services, we must put policies in place to ensure small businesses and entrepreneurs still have the opportunity to succeed in the digital marketplace.”
The bill won approval in the Senate Judiciary Committee by a margin of 16 to six. Supporters were mostly Democrats but included a few Republicans.
It passed only after amendments and heavy criticism by senators from California, where some of the Big Tech companies are headquartered.
Sen. Dianne Feinstein, D-Calif., said the bill invokes antitrust law that is supposed to regulate entire industries but instead is aimed at only a few companies.
“It’s difficult to see the justification for a bill that regulates the behavior of only a handful of companies while allowing everyone else to continue engaging in that exact same behavior,” Feinstein said.
Before the bill makes it to a vote in Congress, it must overcome concerns of another lawmaker, Speaker of the House Nancy Pelosi, D-Calif. Similar legislation has been proposed previously but Pelosi failed to submit it for a vote.
The bill also faces an intense industry lobbying effort to block it.
Among their arguments is that the tough antitrust bill would weaken the Big Tech companies enough that they could not withstand foreign competition, particularly from the Chinese. They say the foreign competition could make the United States and its citizens more vulnerable to cyberattacks.
They were joined in their warnings by former national security officials who wrote a letter to congressional leaders in September saying proposed antitrust laws could weaken the nation’s security.
Some senators who support the bill call the companies’ warnings overblown.
“This bill is not meant to break up Big Tech or destroy the products and services they offer,” said Sen. Chuck Grassley, R-Iowa. “The goal of the bill is to prevent conduct that stifles competition.”
Tom can be reached at [email protected]