A frequent complaint in the tech world is that the big four are too big and too controlling in the industry. There is current U.S. legislation inching closer to break up these tech monopolies. Should Amazon, Apple, Facebook, and Google be worried? Should we be worried?
Tech Monopolies Legislation
If a bipartisan group of legislators gets their wish, Amazon, Apple, Facebook, and Google will be broken up and will no longer be controlling the entire industry.
Five bills were introduced by a group of House representatives. They would make it difficult for any dominating company to buy out other companies. It would also prevent them from owning other businesses that could lead to a conflict of interest for them.
This proposed legislation still has a big road ahead before it would potentially destroy the tech monopolies. The bills first have to pass the House Judiciary Committee, then need to be passed by the entire House. Next, the bills will move on to the Senate, and finally, they will land on the president’s desk.
Before these five bills were proposed, there was an investigation by a House Judiciary subcommittee. The legislators were looking into possible antitrust and monopolies. Particularly troubling for Amazon, Apple, Facebook, and Google is that the bipartisan group agreed that reform was needed to rectify this situation.
Two bills in particular – the American Choice and Innovation Online Act sponsored by the House Judiciary subcommittee on antitrust chair Rep. David Cicilline and Ending Platform Monopolies Act sponsored by Vice-Chair Pramila Jayapal – appear as though they could be most harmful to Amazon and Apple, as both head up online storefronts of some sort.
The other three bills are:
- Platform Competition and Opportunity Act
- Augmenting Compatibility and Competition by Enabling Service
- Merger Filing Fee Modernization Act
Already these two bills are causing concern in the tech industry. Geoffrey Manne is president and founder of the International Center for Law & Economics, a group Google has backed financially in the past. Manne issued a statement that said, “Adopting the European regulatory model would make it harder for American tech companies to innovate and compete both here and globally.”
Also chiming in was CEO Adam Kovacevich of the Chamber of Progress. His advocacy group is backed by Amazon, Facebook, Google, and others. He published an article on Medium that said consumers would suffer if the two bills pass. He suggested that with some products, Amazon wouldn’t be able to offer free shipping to its Prime members, and Google wouldn’t be able to display the most popular search results for businesses similar to theirs. Apple wouldn’t be able to preinstall the Find My app on its devices, and Facebook users wouldn’t be allowed to post to Instagram easily.
Major players in the industry that compete with the big four are, of course, celebrating the proposed legislation.
Horacio Gutierrez, chief legal officer of Spotify, said the American Choice and Innovation Online Act is “an important step in addressing anticompetitive conduct in the App Store ecosystem and a clear sign that momentum has shifted, as the world is waking up to the need to demand fair competition in the app economy.”
Roku said in a statement that it “applauds Reps. David Cicilline and Ken Buck for taking a crucial step toward curbing the predatory and anticompetitive behaviors of some of the county’s most powerful companies.”
The company further said that it “has firsthand experience competing against and interacting with these monopolists, and we’ve seen how they flagrantly ignore antitrust laws and harm consumers by leveraging their dominance in one line of business to stifle competition in another. An aggressive set of reforms is needed to prevent a future where these monopolists further abuse consumer choice and hamper access to innovative and independent products.”
What Could this Mean for the Industry?
While the public may be tired of Amazon, Apple, Facebook, and Google controlling so much of the tech space, do they want to lose out on current offerings as was suggested? Do we want to lose out on free two-day shopping on some products at Amazon? Do we want to get incomplete Google search results? Would the App Store be the same product if another company was running it?
This may end up being one of those be careful what you wish for type of things. Luckily, if the proposed legislation does come to fruition to stop the tech monopolies, it won’t go into effect for some time due to the number of hurdles the bills must pass through first, which will give everyone time to figure it all out.
Read on to learn more about Apple’s inclusion in the antitrust investigation because of its “Sign in with Apple” option.