Apple, Google, Facebook, and Amazon would struggle to evade new regulations.
Legislators in the US House of Representatives introduced five new bills Friday afternoon that promise the biggest overhaul of antitrust law since the trust-busting era of the early 1900s.
The bills take aim at the many platforms that Big Tech companies have rolled out over the last decade or so, including Apple’s iOS, Google’s search and ad platforms, Amazon’s marketplace, and Facebook’s social media and messaging networks. The proposed legislation would usher in sweeping changes both in the way monopoly regulations are enforced and in how companies run their platforms. They would require divestments in some cases while mandating interoperability and portability in others.
“Right now, unregulated tech monopolies have too much power over our economy,” said Rep. David Cicilline (D-R.I.), who introduced one of the bills. “They are in a unique position to pick winners and losers, destroy small businesses, raise prices on consumers, and put folks out of work. Our agenda will level the playing field and ensure the wealthiest, most powerful tech monopolies play by the same rules as the rest of us.”
“Big Tech companies are stifling American innovation with their monopolistic behavior,” said Rep. Lance Gooden (R-Colo.), who co-sponsored two of the bills. “By acquiring their competition and eliminating alternatives in the marketplace, they are denying fair access to the free market for small businesses across the country.”
While the legislation would not ban the platforms outright, it would subject companies to new regulations that would constrain their ability to provide certain products and services, while leveling the playing field for competitors.
The five bills all attempt to address issues that have arisen as various platforms have grown in power. None of the four major platform companies—Apple, Google, Facebook, and Amazon—would appear to be exempt from new regulations if they were signed into law.Advertisement
One bill, known as the American Choice and Innovation Online Act, forbids platforms from favoring their own products and services. It would also stop companies from using private data to get a leg-up on the competition, and it would prevent them from kicking competitors off a platform or harming competitors by restricting their ability to “access or interoperate with the same platform, operating system, hardware, and software features that are available to the covered platform operator’s own products, services, or lines of business.” Introduced by Rep. David Cicilline (R-R.I.) and co-sponsored by Rep. Lance Gooden (R-Tex.), the bill would levy significant penalties on companies that fail to comply—the greater of either 15 percent of the company’s average daily revenue or 30 percent of average daily revenue of the offending line of business.Further ReadingApple clarifies iOS default music app feature, and it’s not what people thoughtApple would appear to be most affected by this bill, though Google, Facebook, and even Amazon would not be exempt. By ensuring interoperability, the legislation would require each platform owner to open their software to competitors to some degree. Apple’s iOS and its tie-ins with Apple Music would be a primary target. Spotify has sued the company in the EU on antitrust grounds, and while Apple has been slowly allowing rival music services access to more system services like Siri, there’s still no way to supplant Apple Music as the default player.
Google’s ad marketplace would be impacted as well. The company’s Ad Manager is already the subject of a settlement with French competition authorities, who said the platform unfairly advantaged Google’s own products.
Another bill, the Ending Platform Monopolies Act, would prevent large platforms—those with at least 50 million monthly active US users and a market cap of $600 billion or more—from owning or operating businesses that would cause them to advantage their own products and services or disadvantage their competitors’. App stores would be potential violators, but so would ad exchanges and music or video services. The bill, which was introduced by Rep. Pramila Jayapal (D-Wa.) and co-sponsored by Rep. Lance Gooden (R-Tex.), would impose fines similar to the American Choice and Innovation Online Act.Advertisement
The Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act, introduced by Rep. Mary Gay Scanlon (D-Pa.) and co-sponsored by Rep. Burgess Owens (R-Utah), would require platforms to guarantee some minimum standard of interoperability and data portability. Facebook would appear to be the target here, given that social media profiles are basically impossible to port from one network to another.Further ReadingAmazon, eBay fight legislation that would unmask third-party sellersThe Platform Competition and Opportunity Act, introduced by Rep. Hakeem Jeffries (D-N.Y.) and co-sponsored by Ken Buck (R-Colo.), would require companies proposing mergers or acquisitions, not the government, to prove their case. Affected companies have 50 million monthly active users or 100,000 monthly active sellers and profits or a market cap of $600 billion or more. This bill is the only one to include “business users”—or seller accounts—which seems to single out Amazon’s marketplace with its millions of third-party sellers.
And the last bill, the Merger Filing Fee Modernization Act, is the only one that aligns with bipartisan legislation proposed in the Senate. The legislation would significantly increase filing fees for mergers, directing the money to regulators in the Department of Justice and the Federal Trade Commission to beef up their antitrust oversight capabilities. It was introduced by Rep. Joe Neguse (D-Colo.) and co-sponsored by Rep. Victoria Spartz (R-Ind.) and is similar to a Senate bill introduced by Sen. Amy Klobuchar (D-Minn.) and Sen. Chuck Grassley (R.-Iowa).
It’s unclear whether any of these bills will pass. The last one, the Merger Filing Fee Modernization Act, appears most likely at this point since it’s a relatively incremental piece of legislation that already has bipartisan support in both chambers. But the fact that the other bills, which garnered bipartisan support in the otherwise highly partisan House, suggests that a major overhaul of antitrust law may be imminent, even if these specific bills don’t survive.
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