Connect with us

Antitrust

Lawmakers And Newsmakers Tackle Google and Facebook Market Power

Sen. Klobuchar, Rep. Cicilline and experts discuss antitrust, big tech and local journalism.

Published

on

Screenshot of Amy Klobuchar taken from Open Markets Institute event

April 21, 2021 – Google and Facebook pose a serious threat to local journalism and—without that journalism—democracy generally, said panelists at an Open Markets Institute event held Tuesday.

With free market competition as a backdrop, the participants discussed antitrust legislation and regulation, data privacy, and funding for journalism.

Sen. Amy Klobuchar, D-Minnesota, who chairs the Senate judiciary’s subcommittee on antitrust, spoke on the recent tussle between Facebook and Australia over news feeds on the social media platform. “That is the very definition of a monopoly — when you can hold a country hostage simply because they want to make sure the content is paid for from the news,” she said.

Both Google and Facebook face several anti-competitive lawsuits from the Department of Justice, states attorneys general, federal agencies and several news publications that claim the big tech’s behavior has led to a monopoly in the digital space.

Google controls over 90 percent of the search engine market and Facebook has eaten up all of their competitors including Instagram and WhatsApp to maintain a social media monopoly, Klobuchar said. She also looked beyond just the tech industry: “America’s competition problem as well, as you all know, isn’t just limited to digital markets. It’s part of a broader problem that affects our entire economy from cat food to caskets,” she said.

“The consequences of the collapse of local news are catastrophic; it’s hard to overstate how severe a threat this is to democracy,” said Steve Waldman, president at Report for America, a national organization dedicated to supporting local journalism.

“We have two dominant platforms who sit between us and our readers, who extract the value of our content, and then they systematically deliver it to the users—our readers—in a highly predictive way so that the users stay within their walled gardens,” said Danielle Coffey, senior vice president at News Media Alliance.

The platforms continue extracting user data that they use as a currency, then when we do get readers, we only get a small percentage of ad revenue, she said. We get hit on the distribution side and the ad revenue side, she added.

Minnesota’s Attorney General Keith Ellison focused on the importance of information for democracy. People need to have access to information, which primarily comes from news sources, and those news sources need funding, he said. Without funding, news publications will close or change, and it will challenge the very foundation of our society, because we need informed people who can make decisions, he said.

No leverage on big tech

“We see our bargaining power with Google and Facebook as zero,” said Randy Lebedoff, senior vice president at the Minneapolis’ Morning Star publication. The digital advertising we get from the online platforms doesn’t make up for the drop in print advertising, because “someone else is getting paid for marketing our articles,” she said.

Although Klobuchar focused mainly on competition in tech industry, she also expressed concern over misinformation on social media. America needs to use free market capitalism that will foster new companies with “privacy bells and whistles” and better policies to control misinformation, she said.

Social media has impacted consumer readership through “the rise of what people call fake news, which is just really low-quality, click-bait propaganda,” said Julia Angwin, editor-in-chief at the Markup, a news organization that investigates big tech.

Propaganda used to be expensive to produce, but we’ve decentralized that and now it’s cheap and possible to make money from, she said. The tech companies elevate misinformation through news feeds with their algorithms and then take no responsibility for it, she said.

Legislation to address concerns

“It is high time for privacy legislation in the United States to protect consumers, we’re going to need something at the federal level. It’s going to be a patchwork mess if we approach it only at a state level,” Yale University fellow Dina Srinivasan said.

In February, Klobuchar introduced the Competition and Antitrust Law Enforcement Reform Act, S.225, legislation that would target anti-competitive behavior. The bill would increase funding for regulators at the Justice Department’s Antitrust Division and the Federal Trade Commission, and shift the burden of proof in mergers to the company to prove their acquisition does not harm a competitive market, among other things.

Rep. David Cicilline, D-Rhode Island, along with several other members of Congress, introduced the bipartisan Journalism Competition and Preservation Act in March, intended to allow small news publishers to collectively negotiate with online platforms to “protect Americans’ access to trustworthy sources of news online,” read the press release.

The bill would allow coordination by news publishers if it “(1) directly relates to the quality, accuracy, attribution or branding, or interoperability of news; (2) benefits the entire industry, rather than just a few publishers, and is non-discriminatory to other news publishers; and (3) is directly related to and reasonably necessary for these negotiations, instead of being used for other purposes,” said the statement.

But Waldman said the Klobuchar and Cicilline bills would likely not help save local news. America needs to look at other policy steps to help local news, he said. He suggested donations toward local journalism efforts.

If there was a slight shift toward viewing journalism as an important part of a community’s health, it would be transformative, he said. It would take $1 to $2 billion of well-targeted money in local news that would double the number of local reporters, which would only be about half of one percent of philanthropic giving, he said.

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.’

Published

on

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.

Continue Reading

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.

Published

on

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.

Continue Reading

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.

Published

on

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.

Continue Reading

Signup for Broadband Breakfast

Get twice-weekly Breakfast Media news alerts.
* = required field

Broadband Breakfast Research Partner

Trending