Antitrust Hearing: US Lawmakers Take Aim at Big Tech Executives
The House of Antitrust Subcommittee just concluded the highest-profile hearing into antitrust and competition since the 1970s. This hearing in Washington includes Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook, and Sundar Pichai of Google’s parent Alphabet appear before members of the House judiciary’s antitrust subcommittee and face enormous interrogation from lawmakers from both sides of the aisle. The hearing was more a test of Congress than of the tech leaders.
The tech hearing lasted about some five and a half hours. The subcommittee has been doing research about the tech companies’ supremacy of the online world for over a year, collecting over 1.3 million documents and conducting several hours of interviews. Already in the opening minutes, the subcommittee chairman, David N. Cicilline kicked off the hearing by saying that the panel had conducted a year-long investigation and found that these companies have “wielded their power in disruptive, harmful ways", which risks the competition and the country’s democracy. The committee, consisting of representatives from both Republican and Democrat parties, questioned the CEOs on matters ranging from privacy, killing competing startups by either stealing their technology or acquiring them, combining control on the market by abusing the gatekeeper status that some of these platforms hold, and much more.
“Our founders would not bow before a king, Nor should we bow before the emperors of the online economy,” the Rhode Island Democrat said.
Though it was Bezos’ first congressional testimony, he appeared the least concerned and fazed. Cook drew fewer tricky questions than Bezos and handled them efficiently. Zuckerberg took the most damage, losing the balance at times when confronted with internal emails. Sundar Pichai, CEO of both Alphabet and Google, took the most heat from the antitrust panel, as he repeatedly told lawmakers that he would be happy to look into various situations and will get back to them.
The Snack Break
Unfortunately, the Big Tech hearing was decidedly low-tech. Amazon's Bezos received no questions for more than an hour in his first appearance before Congress which may have been a tech issue. At one point, the world's richest man appeared to reach off-screen for what appeared to be a snack. Poor audio, flat-screen televisions switching off again, and again and chief executives appearing together as thumbnails on a large screen, frustrated the viewers and led to the parody of this virtual set-up on Twitter.
"Put Your Masks On!"
Lawmakers fall into shouting at points, with a pandemic twist. One lawmaker shouted: “Put your mask on!” This refrain caught the attention of a lot of Twitter users around the world and became a laugh.
Struggle to Defend Monopoly
Representative David Cicilline, a Democrat, and chair of the antitrust subcommittee set the tone when he started by accusing Google of theft.
“Why does Google steal content from honest businesses?” he asked.
David alleged Google stole reviews from Yelp Inc and said Google threatened to delist Yelp from search results if it objected.
To which Pichai responded mildly that he would want to know the specifics of this accusation as he repeatedly told lawmakers that he would be happy to look into various situations and get back to them. “We conduct ourselves to the highest standards,” he said, disagreeing with the allegations that Google steals content to win users.
Facebook’s Zuckerberg took a sequence of questions and accusations about the company’s purchase of Instagram in 2012 and whether it was acquired because it was a threat.
Zuckerberg replied that the deal had been judged by the Federal Trade Commission and Instagram at that time was just a tiny photo-sharing application instead of a social-media thing. He added, “People didn’t think of them competing with us in that space”
Representative Pramila Jayapal asked Zuckerberg on whether Facebook had ever copied its competitors. “How many companies did Facebook end up copying? Is it less than five? Less than 50?” she asked.
To which Mark replied “Congresswoman, I don’t know”
Internal emails haunted Zuckerberg again when he didn’t answer the question. Representative Jayapal quoted an internal email where Zuckerberg himself told Instagram’s co-founder Kevin Systrom that Facebook would build a copycat camera app, during the negotiations with Instagram. Emails were also excavated where Zuckerberg was found to have aspired to buy Google.
An Enormous Amount of Power
Tim Cook, the Apple CEO, faced effective questioning from representative Hank Johnson of Georgia, who said the investigation had surfaced concerns that rules governing the App Store review process are not available to the app developers.
“The rules and terms are made up as you go and subject to change - and Apple expects developers to go along with the changes or leave the App Store,” Johnson said targeting Cook. “That’s an enormous amount of power, you guys have” he added.
Cook argued that the App Store does not constitute a monopoly because it does not charge the vast majority of apps to list there. He said that 84% of apps are not charged anything and the company has not increased any commissions on apps since 2008. Cook rejected the concept that there is nothing to stop his company from raising the commissions it charges in the App Store.
Apple arguably got off the easiest of any of the companies, by the number of questions: Tim Cook got just 35, compared to 59 for Bezos, 62 for Mark Zuckerberg, and 61 for Sundar Pichai.
David Cicilline ended the hearing by saying, “The companies as they exist today have monopoly power,” he said. “Some need to be broken up. All need to be properly regulated.”
A detailed report with antitrust allegations against the four tech platforms and recommendations on how to tame their market power could be released by late summer or early fall by the committee, senior committee aides said.