Last Friday, a rush of bills hit the U.S. House of Representatives that are meant to update the country’s woefully outdated antitrust laws.
Taken together, the five bills would reign in Big Tech’s ability to use the scale of its massive platforms to favor its own products and services over the competition, reinforcing its own power in the process. Google might, for instance, be blocked from highlighting its own local reviews product over Yelp, while Apple wouldn’t be able to sell Apple Music while simultaneously dictating rules for how Spotify can operate on iOS.
Antitrust — The United States has long operated under the “Chicago School” approach to antitrust law, a laissez-faire philosophy that asserts that a free market without government interference will produce the best outcomes. That has reflected itself in policy that finds a company is acting badly only if it’s raising the price of goods for consumers as a result of its market power... but that model doesn’t work when consumers aren’t charged anything for a service.
There is still harm, even if indirectly. Acquisitions have been rubber-stamped, like Facebook buying Instagram and WhatsApp, and the combined power that gives Facebook creates a “moat” that makes it impossible for open competition to thrive. An alternative to Facebook might offer consumers the benefit of less pervasive data collection, but it’s hard to give up a platform where all your friends and family are, so in practice, few people actually stop using Facebook. And because it has all the users, advertisers feel forced to promote their goods on Facebook rather than on competitor services.
Wish list — Even if you agree with the move, situations like former President Trump effectively getting removed from the internet have woken legislators up to the idea that it’s probably not good that just a few companies control so much of our lives.
One of the bills introduced, the “Ending Platform Monopolies Act,” would prevent owners of large platforms from owning or operating businesses that would lead them to advantage their own products or disadvantage competitors. That would probably impact Apple’s App Store, where it offers its own apps but also dictates rules for competitors.
Apple could also be impacted by the “American Choice and Innovation Online Act,” which would require it to offer third-party developers the same access to iOS as it gives its own services. Spotify has attacked Apple for pre-installing Apple Music and requiring that it pay a fee for any customers who subscribe through the App Store, which it says benefits Apple Music unfairly. Apple also doesn’t allow users to set Spotify as their default music player.
Another bill being introduced, the “Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act,” would require platforms like Facebook to guarantee some minimum standard of data portability, suggesting Facebook would be required to allow users to port their profiles to other networks.
Limiting acquisitions — Two other bills introduced would beef up regulator’s oversight over acquisitions and mergers by requiring companies to pay higher fees to file documents for mergers, fees which would directly fund enforcement. Major companies would also be required in cases of mergers or acquisitions to argue to the government why they should be allowed to go through with a deal, rather than the situation now where the onus is on the government to fight it.
If we’re being cynical, most of this probably won’t be passed into law. Or, lobbyists from Silicon Valley will get the bills watered down so much as to be ineffective. But it’s a step in the right direction, and a sign that regulators are beginning to realize Big Tech can’t be left to its own devices.