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Antitrust

Federal Trade Commissioners Disagree About Role of Antitrust Lawsuits Against Big Tech

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FTC Commissioner Christine Wilson

October 20, 2020 — In the midst of the largest lawsuit against a tech giant in decades, Google, the Technology Policy Institute hosted a conversation with two current and two former Federal Trade Commissioners discussing the state of antitrust in the United States. The Tuesday event aired as part of TPI Aspen 2020, a week-long conference investigating the pressing communications technology issues of today.

They agreed the country is currently seeing an antitrust revival like never before. The Justice Department antitrust division on Tuesday accused search engine giant Google of using its market dominance to disadvantage the competition.

Further, the lawsuit came shortly after the House Judiciary Antitrust Subcommittee’s report into the allegedly anti-competitive practices of Apple, Amazon, Facebook and Google. The report proposed an array of changes to reign in the power of big tech companies, including barring them from acquiring future startups and banning them from both owning marketplaces and selling competing products.

The commissioners disagreed on whether structural conditions of the market, the subject of course of existing federal law, including antitrust law, are to blame for fostering technology companies’ massive growth.

FTC Commissioner Christine Wilson argued that systemic issues, possibly causing high concentration and high barriers to entry in the marketplace, should not be seen as an enemy to consumers.

“Heavy regulation stifles innovation and raises costs for consumers,” said Wilson, adding that the FTC “should not be in the business of determining what arenas” a company is able to operate in, precisely what the House report called for.

Wilson claimed that free markets with light touch regulation incentivize competition and that “structurally limiting the number of heads that can operate in a given industry” would serve to reduce innovation.

The House “report doesn’t make any claim that they have seen systematic failures,” noted Josh Wright, law professor and executive director of the Global Antitrust Institute at George Mason University law school.

“Many did not see any systematic issues in how the DOJ and the FTC approach mergers,” said Edith Ramirez, co-head of antitrust and competition in privacy and cybersecurity at Hogan Lovells, and former FTC Chair under President Barack Obama.

Yet, Commissioner Rebecca Slaughter argued the opposite, saying that failing to address the structural issues causing concentration in the market will result in long-term implications for the U.S. economy.

“Cost isn’t the only thing that is important,” said Slaughter, saying new legislation is needed to create more opportunity for innovation.

Wright said he was unsure of whether current or future administration will be up to the task of drastically altering antitrust law.

“Legislation is hard and a lot of the tools we have are limited,” said Slaughter, urging the FTC to do everything in its power.

One thing the commissioners agreed on is that the FTC lacks critical resources. Echoing the House report, the panelists called for Congress to strengthen the FTC by increasing the agency’s budget.

“We live in a world of finite resources and the FTC’s budget is shrinking not growing,” said Wilson.

“Christine’s point about resources is true. Since, 2010 there has been an 80 percent increase in merger filings,” said Slaughter. “We’re having to review twice as many mergers without any additional resources, which effects how thorough we can be.”

Antitrust

‘Time is Now’ for Separate Big Tech Regulatory Agency, Public Interest Group Says

‘We need to recognize that absolutely the time is now. It is neither too soon nor too late.’

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Photo of Harold Feld, senior vice president at Public Knowledge

WASHINGTON, June 21, 2022 – Public Knowledge, non-profit public interest group, further advocated Thursday support for the Digital Platform Commission Act introduced in the Senate in May that would create a new federal agency designed to regulate digital platforms on an ongoing basis.

“We need to recognize that absolutely the time is now. It is neither too soon nor too late,” said Harold Feld, senior vice president at Public Knowledge.

The DPCA, introduced by Senator Michael Bennet, D-CO., and Representative Peter Welch, D-VT., would, if adopted, create a new federal agency designed to “provide comprehensive, sector-specific regulation of digital platforms to protect consumers, promote competition, and defend the public interest.”

The independent body would conduct hearings, research and investigations all while promoting competition and establishing rules with appropriate penalties.

Public Knowledge primarily focuses on competition in the digital marketplace. It champions for open internet and has openly advocated for antitrust legislation that would limit Big Tech action in favor of fair competition in the digital marketspace.

Feld published a book in 2019 titled, “The Case for the Digital Platform Act: Breakups, Starfish Problems and Tech Regulation.” In it, Feld explains the need for a separate government agency to regulate digital platforms.

Digital regulation is new but has rapidly become critical to the economy, continued Feld. As such, it is necessary for the government to create a completely new agency in order to provide the proper oversight.

In the past, Congress empowered independent bodies with effective tools and expert teams when it lacked expertise to oversee complex sectors of the economy but there is no such body for digital platforms, said Feld.

“The reality is that [Congress] can’t keep up,” said Welch. This comes at a time when antitrust action continues to pile up in Congress, sparking debate across all sides of the issue.

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Antitrust

FTC Commissioner Concerned About Antitrust Impact on Already Rising Consumer Prices

Noah Phillips said Tuesday he wants the commission to think about the impact of antitrust rules on rising prices.

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Screenshot of Federal Trade Commissioner Noah Phillips

WASHINGTON, May 17, 2022 – Rising inflation should be a primary concern for the Federal Trade Commission when considering antitrust regulations on Big Tech, said Commissioner Noah Phillips Tuesday.

When considering laws, “the important thing is what impact it has on the consumer,” said Phillips. “We need to continue to guard like a hawk against conduct and against laws that have the effect of raising prices for consumers.”

Current record highs in the inflation rate, which means money is becoming less valuable as products become more expensive, has meant Washington must become sensitive to further price increases that could come out of such antitrust legislation, the commissioner said.

Phillips did not comment on how such movies would mean higher prices, but that signals, such as theHouse Judiciary Committee’s antitrust report two years ago, that reign in Big Tech companies and bring back enforcement of laws could mean higher prices. He raised concerns that recent policies are prohibiting competition rather than facilitating it.

This follows recent concerns that the American Innovation and Choice Online Act, currently awaiting Senate floor consideration, will inhibit America’s global competitiveness by weakening major American companies, thus impairing the American economy. That legislation would prohibit platform owners from giving preference to their products against third-party products.

This act is one of many currently under consideration at Congress, including Ending Platform Monopolies Act and Platform Competition and Opportunity Act.

Small businesses have worried that by enacting some legislation targeting Big Tech, they would be impacted because they rely on such platforms for success.

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Antitrust

Critics and Supporters Trade Views on American Innovation and Choice Online Act

American Innovation and Choice Online Act is intended to protect fair competition among businesses, but panelists differed on its impact.

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Photo of Amy Klobuchar from August 2019 by Gage Skidmore used with permission

WASHINGTON, May 10, 2022 – Experts differed on the effect that antitrust legislation targeting big tech companies allegedly engaging in discriminatory behavior would have on small businesses.

Small businesses “want Congress not to do anything that will screw up or weaken the services that they rely on for their business,” said Michael Petricone, senior vice present of the Consumer Technology Association, at a Protocol Live event on Thursday.

Petricone said that antitrust bill would encourage tech companies to relocate to other countries, harming the American economy. He said small businesses would be affected the most.

Instead, Petricone called for  a “smarter immigration policy” to allow foreign innovators access to American tech market, as well as the defeat of the antitrust legislation.

But other said that small businesses suffer from predatory behavior by big tech companies. “Companies can’t get their foot in the door when there is already self-preferencing,” said Awesta Sarkash, representative for Small Business Majority, an advocacy organization, adding that 80% of small businesses say they want antitrust laws to protect them.

Self-preferencing on online platforms is detrimental to the success of small businesses who rely on social media advertising for business, she said. The new antitrust proposals would ensure an level playing field and promote fair competition, she said.

The American Innovation and Choice Online Act would prohibit certain online platforms from unfairly preferencing products, limiting another business’ ability to operate on a platform, or discriminating against competing products and services.

The bill sponsored by Sen. Amy Klobuchar, D-Minn, was introduced to the Senate on May 2 and is awaiting Senate floor consideration.

The debate follows concerns raised by both democrats and republicans about America’s global competitiveness as the bill would weaken major American companies.

If passed, the bill will follow the European Union’s Digital Services Act which similarly sets accountability standards for online platforms, preventing potentially harmful content and behavior.

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