February 2, 2023

Google, Facebook, Amazon Among Those Set to Fight House Big Tech Antitrust Package

The House Judiciary Committee voted on Thursday to approve the final piece of its six-part package, the “Ending Platform Monopolies Act,” which restricts big tech companies’ ability to leverage their platform dominance to promote other lines of business and disadvantage competitors. The measure could make it easier for federal regulators to break up the companies, lawmakers said. The vote on the bill was 21-20.

The move leaves the big tech firms—once darlings of Washington—in lawmakers’ crosshairs, despite intensive lobbying efforts. Still, the companies will have multiple opportunities to block or water down the broad legislative package, which must be approved on the House floor and then in the Senate to become law.

The package also includes a measure to bar big tech companies from favoring their own products in a range of circumstances on their platforms. Known as the American Choice and Innovation Online Act, it would prohibit big platforms from engaging in conduct that advantages their own products or services, disadvantages other business users, or discriminates among similarly situated business users.

Another measure requires that the largest internet platforms make it easier for users to transport their data to other platforms and even communicate with users on other platforms. The bill—known as the Augmenting Compatibility and Competition by Enabling Service Switching, or Access, Act—would give the Federal Trade Commission extensive new powers to set individualized standards for the large tech companies.

Already on Thursday, lobbyists and trade groups for the large tech companies were complaining that the House bills are being rushed through with little thought to the impact they will have on consumers. If the process slows, they say they believe they will win over enough lawmakers to defeat most or all of the measures. Tech companies also were weighing more outreach to the public to raise warnings about the legislation.

The Chamber of Progress—a new advocacy group funded by

Amazon,

AMZN -1.56%

Google and Facebook, among others—has been circulating a survey it commissioned showing Americans are reluctant to give up services provided by the companies that are targeted by the tech bills.

Apple’s hardware, software and services work so harmoniously that it is often called a “walled garden.” The idea is central to recent antitrust scrutiny and the Epic vs. Apple case. WSJ’s Joanna Stern went to a real walled garden to explain it all. (Video published June 4) Photo illustration: Adele Morgan/The Wall Street Journal

While the survey found that more than half of respondents favored Congress imposing new regulations on tech, people were much less likely to back restrictions on specific services offered on the sprawling platforms, such as Amazon Prime.

“Part of what we are trying to say to members is this is not something that voters are clamoring for,” said Adam Kovacevich, who founded the Chamber of Progress and is a former Google lobbyist. “People don’t want Congress to break something that is working well, and I think members are underestimating the consumer backlash they would face if they break up these consumer conveniences.”

Tech lobbyists say they believe that as House members review the bills, they are likely to question how many of the ambitious but little-understood provisions would work in practice. Mr. Kovacevich said that was evident at the lengthy markup hearing as several California lawmakers voiced repeated doubts as the night wore on.

Antitrust advocates who hope to win over Republicans also were dealt a blow when Minority Leader Kevin McCarthy (R., Calif.) said last week that he opposes giving more enforcement powers to agencies headed by Biden appointees. Mr. McCarthy is working on a separate tech plan that his office said would address what Republicans see as anticonservative bias by the large social media platforms.

Tech representatives also have been heartened by what they view as Speaker

Nancy Pelosi’s

measured approach to the antitrust overhaul so far.

The bills face additional hurdles in the closely divided Senate. So far it has taken a different approach to antitrust issues, led by Sen. Amy Klobuchar (D., Minn.), who chairs the Senate antitrust subcommittee. But more recently she has been focused on developing more proposals along the lines of some of the House measures, particularly the nondiscrimination bill.

“I look forward to continuing to work with members of the House and Senate to rein in the unfettered power of big tech,” Ms. Klobuchar said.

Finding common ground between the House and the Senate—in addition to bridging the philosophical differences between the two parties—also is likely to prove challenging. The emergence of a small but determined group of House Republicans who were willing to work with progressive Democrats on the antitrust package set off alarms for the large tech companies this week.

The package was the culmination of a lengthy bipartisan investigation by a House antitrust subcommittee. It found that the big tech companies have leveraged their dominance to stamp out competition and stifle innovation.

Taken together, the bills represent the beginnings of an effort by many in Congress to reinvigorate antitrust enforcement among high-tech companies by updating laws they say have fallen behind. Rep. David Cicilline (D., R.I.) said the unchecked power of the biggest tech companies threatens economic fairness and even American democracy itself.

“At its core, this issue is fundamentally about whether or not we have an economy where businesses fighting for economic survival can actually succeed,” Mr. Cicilline said.

Republicans led by Rep. Jim Jordan of Ohio mostly opposed the measures, arguing they represented a vast expansion of government power and a worrisome new marriage of big tech and big government. But a smaller band of Republicans led by

Rep. Ken Buck

of Colorado generally supported the effort, contending that the tech companies are a rising risk to small businesses and individual users.

The effort has gained support from the Biden administration, which recently surprised Silicon Valley firms by naming a young progressive critic of big tech, Lina Khan, to lead the FTC, one of two federal agencies that enforce U.S. antitrust laws. Ms. Khan is a former House antitrust staffer who worked on the big tech investigation. She is expected to refocus the agency’s enforcement efforts on anticompetitive problems.

But the White House suggested further work might be needed on some of the legislation, reflecting potential problems ahead.

“The president is encouraged by the bipartisan work to address problems created by big tech platforms,” a White House official said. “We hope the legislative process continues to move forward on these bipartisan proposals, and we look forward to working with Congress to continue developing these ideas.”

The legislative effort also has run into fierce opposition from many big tech companies and their Washington allies on both sides of the aisle.

The House committee vote Thursday was a step toward curbing the dominance of large tech companies such as Google.



Photo:

David Paul Morris/Bloomberg News

Google pushed lawmakers to delay action on the bills pending more debate. “American consumers and small businesses would be shocked at how these bills would break many of their favorite services,” said Mark Isakowitz, vice president of government affairs and public policy for Google. “This would all dramatically undermine U.S. technology leadership, damage the way small businesses connect with consumers and raise serious privacy and security concerns.”

Apple released a report on Wednesday arguing against provisions of the American Choice and Innovation Online Act that would allow users to download apps onto their iPhones without having to use Apple’s App Store. The company said that would harm customers by threatening their privacy and parental controls and potentially exposing users’ data to ransomware attacks.

Write to John D. McKinnon at [email protected] and Julie Bykowicz at [email protected]

Taking Aim at Big Tech

More coverage of efforts to curb large tech firms, selected by the editors

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