- Posted on: Aug 18 2020
By Mary Witzel
Witzel is an Associate at Dunlap Bennett & Ludwig’s Leesburg Office.
[Aug. 18, 2020] On July 29, 2020, the CEOs of Amazon, Google, Facebook, and Apple appeared before the Antitrust Subcommittee of the U.S. House of Representatives to answer questions about potentially monopolistic tactics used by the four companies. The companies are four of the six largest publicly-traded companies in the U.S., are considered to dominate their respective markets, and are worth nearly $5 trillion combined.
Amazon’s CEO, Jeff Bezos, faced some of the most stringent questionings from Antitrust subcommittee members. Newspapers such as The Wall Street Journal have recently investigated allegations that the company is pushing independent sellers out of the market by using seller data to develop competing goods. During the Antitrust subcommittee hearing, lawmakers pressed Bezos for answers about whether Amazon ever uses seller data for its own benefit. “I can’t answer that question yes or no,” Bezos said, explaining that Amazon has a policy against using seller data to aid its own private label business, “but I can’t guarantee you that that policy has never been violated.”
Google’s CEO, Sundar Pichai, faced a different line of questioning. Lawmakers focused on whether the behemoth search engine company ever favors its own pages and products when returning search results, or whether the company ever uses content from competing services.
Mark Zuckerberg, CEO of Facebook, faced questions about the company’s $1 billion acquisition of the Instagram app in 2012. Tim Cook of Apple had to answer allegations that his company uses the Apple App Store to edge out or punish rival companies.
The July 29, 2020 hearing was a preliminary step to closing a Congressional antitrust investigation that began a year earlier, in July 2019. The stated purpose of the investigation is to determine whether big tech companies are using monopolistic tactics that lead to a loss of genuine competition and result in public harm.
Although the tenor of the hearing made it clear that lawmakers have identified several instances where the four companies may have discriminated against rival companies or bought up the competition, it is less clear whether such actions are significant enough or damaging enough to be considered antitrust violations. Due in August or September of this year, the subcommittee’s final report will finalize the subcommittee’s investigative findings and its takeaways from the July hearing.
The report is expected to answer two questions that remain open-ended after the July hearing. Are Apple, Google, Facebook, and Amazon engaging in anticompetitive behavior? And, if so, what does the subcommittee recommend Congress do about it? Observers have noted that the subcommittee may recommend heightened regulation or even splitting the tech giants into smaller companies. These actions could have a measurable impact on consumers of the tech giants’ services. They could set an essential precedent for assessing the behavior of tech titan companies in the future. For now, it is clear that the tech titans are under scrutiny, and that the companies themselves and general observers alike await the outcome of this scrutiny, which will be conveyed in the findings and recommendations of the subcommittee’s final report.
Posted in: Business Law