CEOs at Amazon, Apple, Facebook, and Google appear at a historic hearing on Wednesday to defend their companies from accusations of breaking antitrust law. Some have called this tech’s “Big Tobacco” moment.
A historic hearing brews in Washington D.C. as four tech giants face the force of the government. Amazon, Apple, Facebook, and Google are all under investigation from federal and state antitrust officials as well as lawmakers in the hearing for stifling rivals and harming consumers. Some have called this tech’s “Big Tobacco” moment.
For the first time ever, four industry captains — Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook, and Sundar Pichai of Google — will appear together before Congress to defend their business practices. Though all four companies are under investigation for breaking antitrust law, the companies each face their own set of accusations.
Amazon faced accusations of abusing its duo roles as a retail site and a platform for third-party sellers. Apple received complaints from companies and app developers for using the Apps store to block rivals and to force apps to pay high commissions. Facebook faced scrutiny for its monopoly in social networking by acquiring competitors like WhatsApp and Instagram. Alphabet, the parent company of Google, faces multiple antitrust allegations because of Google’s dominance in online advertising, search, and smartphone software.
In addition to concerns about antitrust, lawmakers expect to grill the tech CEOs on topical issues like the spread of misinformation on their platforms, their alleged stifling of free speech, and their business practices during the Covid-19 pandemic.
Cicilline: “Simply put: They have too much power”
The hearing on Wednesday caps a 13-month investigation by the House subcommittee that obtained hundreds of hours of interviews and more than a million documents. The tech CEO’s responses to lawmakers’ questions could advance other antitrust cases against their companies. Zuckerberg in particular is at risk of deposition by the Federal Trade Commission in its probe of Facebook.
Representative David Cicilline, Democrat of Rhode Island and chairman of the antitrust subcommittee, leads the hearing. A New York Times article published last December said he may be “Big Tech’s biggest threat,” as he seeks to not only examine these companies’ practices and profits but also fundamentally change the laws regulating them.
“Our founders would not bow before a king,” Cicilline said on Wednesday. “Nor should we bow before the emperors of the online economy.”
At the hearing, the 15 members of the antitrust subcommittee will have five minutes for each question. Though the issue of antitrust is bipartisan, Democrats and Republicans on the committee will likely bring up partisan concerns like racial discrimination and censorship of conservative voices.
Cicilline opened the hearing by slamming the tech companies for their online dominance which harms the economy and leaves consumers with no other option but to use their products.
“Any single action by one of these companies can affect hundreds of millions of us in profound and lasting ways,” said Cicilline in his opening statement. “Simply put: They have too much power.”
Tech giants claim their companies do good
In all four opening statements of the tech CEOs, there is a common theme. The success of their company represents the entrepreneurial spirit that informs the American dream. Also, the products they make are good for America and its economy.
Of the four CEOs, Bezos is the only one to have never testified before Congress prior to Wednesday’s hearing. Both Cook and Pichai testified once before and Zuckerberg, the youngest of the group, leads the way with his three congressional hearings about Facebook. All four CEOs push back against the allegations of their dominance by arguing that their power helps small businesses or that they are really not that powerful at all.
Bezos, the world’s richest man by far, emphasized his modest upbringing and his family’s unlikely circumstances in his opening statement. His mother had him at 17, and his dad adopted him at the age of four. They gave him the initial capital to start Amazon, whose success depends largely on small and medium-sized businesses, Bezos claimed. In turn, Amazon is the main source of revenue for these businesses.
Similarly, Pichai, Google’s CEO since 2015, emphasized the role Google plays in amplifying small businesses. Pichai did not have access to a computer until he arrived in the U.S. for grad school. Inspired by the way technology leads to opportunities, Pichai created Google Chrome to be accessible. Many small businesses rely on Google advertising, revenue, and assistance, Pichai claimed. The company also invests in groundbreaking technology in medicine and science.
Cook, who took over as Apple’s CEO in 2011, stressed the founding of Apple as a “uniquely American” success story. The App Store, a core part of the Apple identity, facilitated $138 billion dollars in the U.S. and created more than 1.9 million jobs across all 50 states, according to an Apple-commissioned study in 2019.
Zuckerberg, whose company is already under fire for election interference and privacy violations, maintained that Facebook is a public good. Facebook keeps people connected in an increasingly digitized world and offers small businesses a direct connection with consumers. Facebook’s acquisition of Instagram and WhatsApp helped both platforms grow and develop their services, Zuckerberg claimed.
The four CEOs also dismissed the accusations that they monopolized their markets. Bezos pointed to retailers like Walmart, Target, and Costco; Pichai said Google faces competition from Alexa, Twitter, Instagram, WhatsApp, and Pinterest; Cook said the iPhone has not cornered the smartphone market at all, pointing to Huawei, Samsung, LG, and Google; and though Zuckerberg did not explicitly name competitors, he said Facebook has “significant” rivals, including other “companies appearing at this hearing.”
Jim Jordan: “Big Tech’s out to get conservatives”
Top Republicans on the committee immediately raised concerns about bias against conservatives as well as companies’ efforts in China.
Representative Jim Jordan, Republican of Ohio, used his opening statement to list instances where Republican officials had their content “censored” by the platforms. He also mentioned anecdotes of censorship on Twitter, even though the platform is not under investigation.
“I’ll just cut to the chase, Big Tech’s out to get conservatives,” said Jordan. He also asked Pichai whether Google would use its platform to help Democratic presidential nominee Joseph R. Biden Jr.
Republican suspicion of bias stems from the accurate assumption that Silicon Valley is made up of majority of liberal-leaning workers. However, on platforms like Facebook, conservative publications, and public figures routinely rank among top-performing pages.
Google also faced scrutiny from Republicans in the subcommittee for its involvement in China. In 2018, Google announced they pulled out of a contract to help the Pentagon build technology systems to fortify drone usage after its employees protested.
Representative Ken Buck from Colorado and Matt Gaetz from Florida pressed Pichai on Google’s decision to stop working with the Pentagon while it continued to operate an artificial intelligence lab in China. Pichai denied accusations that Google still works with the Chinese military and said the company worked on a cybersecurity project with the Department of Defense.
Bezos defends Amazon brand products
Amazon faces not only accusations of inappropriately using its data to develop an in-house line of products, but also the huge income disparity between him and his employees, and allegations from warehouse workers of poor treatment.
Representative Pramilla Jayapal, Democrat of Washington, asked Bezos if Amazon uses data on its third-seller parties’ products to develop its in-house line.
“We have a policy against using seller specific data to aid our private label business, but I can’t guarantee you that that policy has never been violated,” Bezos replied.
Bezos’s response contradicts that of former employees, who told the subcommittee that they treated proprietary data like “a candy shop” to develop Amazon products.
Bezos faced more tough questions as lawmakers confronted him about Amazon’s “bullying” of third-party sellers. Representative Lucy McBath, Democrat of Georgia, played an audio recording of a third-party bookseller who said the company fails to protect small sellers.
“We followed all the rules that were set by you. Please help us in earning our livelihood. We beg you,” the third-party bookseller said.
Bezos, surprised, said that he does not think that the bookseller’s experience is typical. “I don’t understand what’s going on in that anecdote,” Bezos said. “I do not think that’s systematically what’s going on.”
McBath pushed back, saying that multiple third-party sellers shared their similar experiences with the subcommittee. “I don’t think you understand the point. I’m concerned that this is a pattern of behavior,” McBath said.
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