Alarm bells are ringing for Big Tech on Capitol Hill. Antitrust legislation that bans self-preferencing – a tactic Big Tech uses to bury competition by using its platform dominance to favor its own products – is firmly back on the agenda. The updated version of the bipartisan American Innovation and Choice Online Act speaks volumes about the appetite to pass this Bill. Senate Majority Leader Chuck Schumer (D-NY) recently announced that he intends to bring the bipartisan legislation up for a vote by early summer. We need that intention to become reality – the time is now for the Senate to act.
Of course, to keep the gravy train going, Big Tech is trying to defend the indefensible with a full-court Beltway press, and sometimes, even bankrolling sham advocacy organizations to manufacture public opposition to antitrust reform. It has mobilized lobbyists, lawyers and others to claim the self-preferencing ban in the American Innovation and Choice Online Act would somehow stop them from providing wildly popular services like Google Docs and Amazon Prime.
This is nonsense. All this bill does is to make sure that others can compete fairly with those services, giving more choice, better prices and driving more innovation, not less. Big Tech doesn’t want that competition to exist, but it will be great for American consumers.
But while Big Tech is deploying seemingly limitless resources to derail the bill’s progress, there are signs that its veneer is starting to crack. Not only was the Senate Judiciary Committee rightly unmoved by Big Tech’s crocodile tears, but smaller tech companies have split off to come out in favor of the bill.
This is no surprise. These smaller firms and startups know better than anyone how Big Tech uses self-preferencing to suffocate competition. They muscle in on lucrative, fledgling industries by using their platform dominance to promote their product, while demoting and burying the competition.
It is a tactic they have used repeatedly to choke smaller competitors in a variety of industries – including comparison shopping, travel booking, smart speakers and restaurant reviews – and sometimes drive them to the brink of extinction and beyond, rather than compete on a level playing field.
We have experienced this tactic firsthand at Kelkoo. For years, our comparison-shopping site competed in a crowded marketplace, continually improving our services, and refining our technologies to provide the best customer experience. Then Google stepped in with a service of its own and after its initial effort flopped, it altered its search results, burying competitors’ results so deep users would likely not find us – while putting its own Google Shopping service at the top spot.
However, the days of operating above antitrust norms may be numbered. Late last year, the European Union courts upheld a €2.42 billion fine for Google after regulators concluded it had abused its dominance in search by giving prominent search result placement to Google Shopping, while demoting rivals.
Big Tech does not want America to be the next domino to fall and has drastically increased its already heavy spending on lobbying – from $34 million in 2020 to more than $55 million in 2021 – to ensure it can continue to act like the robber barons who divided up American industry between them at the turn of the 20th century, or the oligarchs who have done so in Russia today.
Ironically, this spending is funded by the anti-competitive behaviour Congress wants to outlaw, while some of its victims can now barely afford the airfare to give evidence at hearings.
In a divided Congress, a bipartisan bill that seeks to end these predatory practices speaks volumes. The US has an opportunity to do what it has always done well, in regulatory terms: quickly assess the lay of the land, intervene robustly with enforceable remedies, fines and even break-ups, and brook no stalling from lawyers and lobbyists whose only objective is to delay, delay, delay while profits keep ticking up.
To borrow a Big Tech mantra, U.S. regulators would do well to “Move fast and break things,” before all the competition has gone – and the pressure to innovate or keep prices low has gone with it.