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Long-Awaited House Report Says Congress Should Consider Breaking Up Big Tech

This article is more than 3 years old.
Updated Oct 6, 2020, 11:54pm EDT

Topline

As Washington continues to scrutinize Big Tech, the House Judiciary Antitrust Subcommittee on Tuesday released a long-awaited investigation into Amazon, Apple, Google and Facebook, recommending that Congress take aggressive action and consider breaking up “certain dominant platforms.”

Key Facts

The House panel found that Facebook and Google have “monopoly power” while Apple and Amazon have “significant and durable market power.”

The report says Congress should “consider legislation that draws on two mainstay tools of the antimonopoly toolkit: structural separation and line of business restrictions.”

The report also recommended nondiscrimination rules that would prohibit companies from preferencing of their own products or services, such as Amazon-branded products or Apple Music, over third party competitors on their platforms.

Lawmakers slammed the Federal Trade Commission and the Justice Department for failing to prevent anticompetitive mergers, and proposed a shift in how regulators look at potential acquisitions: Any merger by a dominant platform would be presumed anticompetitive unless it could show the transaction was in public interest and similar benefits couldn’t be achieved through internal growth and expansion.

Though the subcommittee investigation was started by members of both parties, Republicans didn’t sign onto the final report and instead released their report opposing “onerous and burdensome regulation.”

The report won’t result in fines or other legal consequences, and it is up to Congress to ultimately take up the recommendations of the subcommittee.

Crucial Quote

“As demonstrated during a series of hearings held by the Subcommittee and as detailed in this Report, the online platforms’ dominance carries significant costs. It has diminished consumer choice, eroded innovation and entrepreneurship in the U.S. economy, weakened the vibrancy of the free and diverse press, and undermined Americans’ privacy,” the report says.

Chief Critics

In a statement, Apple said is vehemently disagrees “with the conclusions reached in this staff report with respect to Apple,” adding that it “does not have a dominant market share in any category where we do business.”

Amazon published a blog post saying “fringe notions on antitrust would destroy small businesses and hurt consumers.” The company especially took issue with the notion that it shouldn’t be allowed to sell its own Amazon-branded products alongside third-party sellers. “What these misguided notions from some subcommittee staff misunderstand is the fact that third parties having the opportunity to sell right alongside a retailer’s products is the very competition that most benefits consumers and has made the marketplace model so successful for third-party sellers,” the post reads.

Facebook argued in a statement that its acquisition of Instagram and WhatsApp made those apps even more successful. “A strongly competitive landscape existed at the time of both acquisitions and exists today. Regulators thoroughly reviewed each deal and rightly did not see any reason to stop them at the time,” a spokesperson said.

A Google spokesperson said the company disagrees with both reports, “which feature outdated and inaccurate allegations from commercial rivals about Search and other services.”

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