A significant congressional meeting involving the four biggest players in tech barely registered on the public conscience at the end of July. Perhaps that is unsurprising considering the news remains dominated by the ongoing crisis caused by the coronavirus pandemic and the civil rights protests across the United States.
Still, that should not dilute from the importance and historic nature of the meeting. Amazon CEO Jeff Bezos, Facebook boss Mark Zuckerburg, chief executive of Google Sundar Pichai, and Apple head Tim Cook all appeared before members of the House judiciary’s antitrust subcommittee.
The four tech titans faced intense questioning from United States lawmakers who concluded that the four companies held “too much power”, were accused of spreading misinformation and fake news, and were criticized for behaving like “cyber barons” by using their unprecedented power and wealth to unfairly crush the competition.
It was a combative and charged hearing that exposed what many people already knew: that tech’s Big Four continue to use their positions of dominance to take out rivals and overcharge businesses and consumers that rely on their services.
All four men faced an intense grilling over the practices of their companies, in particular Zuckerberg who received criticism from both sides of the aisle.
Facebook has been the most powerful platform in the wide spread of fake news that has influenced major political decisions, including the election of Donald Trump as US president and the United Kingdom’s Brexit referendum. Zuckerberg also faced great scrutiny over Facebook’s 2012 acquisition on Instagram.
Pichai, chief executive of Google and its parent company Alphabet, was on the receiving end of plenty of scrutinies, with subcommittee chairman David Cicilline accusing the giant of “abusing its power” after it had become “the gateway to the internet”. Pichai was also grilled on accusations that Google had stolen content from small businesses.
Bezos, meanwhile, faced questions over Amazon’s use of data from third-party sellers in making sales decisions on the retail platform while also prioritizing Amazon’s own products regarding shipment during the pandemic.
Cook perhaps got off most lightly while defending Apple’s practices in how it conducted business on its App Store, although the company was accused of holding an “enormous amount of power” in the app space.
Yet, while the four most powerful men in tech were held to account for the actions of their companies, what will be telling is the sort of action that will be taken as a result of the hearing.
Lawmakers who sat in on the hearing suggested that new antitrust measures would be introduced to prevent the monopolization that Facebook, Google, Amazon, and Apple threaten to hold in their respective industries.
“These companies, as they exist today, have monopoly power,” Cicilline said in his closing remarks. “Some need to be broken up, all need to be properly regulated and held accountable. This must end.”
In the aftermath of the hearing, there has yet to be a definitive guide as to what antitrust actions may be implemented, but it is sure to include tighter regulations – both in day-to-day practices and acquisitions – more stringent enforcement of antitrust laws, and greater transparency and accountability.
The problem that US lawmakers face is not only how to implement and police any such measures but how to hold four companies that wield so much power to account, particularly in a world that has become increasingly digital.
There isn’t an industry in existence that hasn’t been directly impacted by the digital revolution. Streaming services have reshaped the way television shows and movies are distributed and consumed; online retailers have changed shopping habits; online casinos have transformed the gambling industry; while news websites have made access to information easier than ever before.
Social media, meanwhile, has not so much digitalized an existing industry but transported society – all its good, bad, and ugly – to an online universe, making it an even more powerful tool than any other component on the Internet.
Whereas in the past, lawmakers have been able to limit the dominance of major companies that held or threatened to hold, a monopoly – Standard Oil being a great example – how do they set about doing something similar when the fluidity and continued expansion of the Internet means it doesn’t have any set boundaries?
Tech’s “Big Four” undoubtedly need to be subjected to greater scrutiny, but sweeping changes that diminish their influence appear unlikely, particularly when considering their importance to the American stock market.
At a time when the US economy reports an overall record-setting collapse of 32.9 percent, Facebook, Google, Amazon, and Apple, all saw their stock prices soar amid the coronavirus pandemic. The “Big Four” – along with Microsoft – now account for nearly one-quarter of the S&P 500 index by total market capitalization.
It is, therefore, safe to assume that any potential break up of their power would cause direct harm to their stock prices and have an immediate negative effect on the US stock market at a time of great economic uncertainty.
The balance US lawmakers need to attempt to strike is how to maintain the companies’ financial clout as it pertains to the US economy while simultaneously preventing the threat of monopolization. It appears an unenviable, perhaps impossible, task.
