Antitrust bills for homes could change the internet as we know it. Here’s how

As lawmakers prepare to introduce the bills Wednesday, the challenge now is to understand what the new legislation might mean for the products and services consumers use every day.

The Chamber of Progress, a tech-backed organization, said the bills would ban harmless features that consumers love. For example, she said in a letter to a top Democrat in the House of Representatives, that Google would be prevented from displaying shopping lists above search results because that could be seen as detrimental to Amazon. Facebook was unable to cross-promote Instagram Stories on the Facebook News Feed. YouTube may even be forced to upload pornographic material.

These tactics are mostly industrial intimidation tactics designed to derail the legislative process, said Stacey Mitchell, co-director of the Institute for Domestic Self-Reliance, an advocacy group that has been particularly critical of Amazon.

This is what we do and what we do not know.

Amazon

Amazon may have to choose between operating a marketplace for third-party sellers or going back to the days when it only sold the same retail products. Amazon’s interconnected companies, including its Alexa smart assistant, its cloud-computing arm Amazon Web Services, and its growing logistics business, may eventually have to split into pieces.

A spokesman for Rep. Pramila Jayapal, a Washington Democrat who co-authored the End Monopolies Statute Act, one of six antitrust bills being considered, said the bill driving the bill are accusations that Amazon’s sheer size and various lines of business allow it to By controlling and controlling the sellers on the platform.

The spokesperson, Chris Evans, cited numerous reports of sellers who felt they had “no choice but to pay for fulfillment by Amazon to sell their products.”

A supplementary bill, the US Online Innovation and Choice Act, would prohibit Amazon from requiring sellers to purchase other Amazon products and services as a condition of presence on the Platform; prevent Amazon from using seller sales data to promote Amazon-branded products; It prevented the tech giant from trying to control how a seller prices its products.

Amazon said that by requiring the company to stick to a single business model, bills could force it to stop supporting independent third-party sellers, hurting the economy.

“More than half a million small and medium-sized American businesses make their living through the Amazon Marketplace, and without access to Amazon customers, it would be very difficult for these outside sellers to create awareness of their business and earn similar income,” said Brian Hausmann, Amazon’s vice president of public policy.

According to analysts, they could be smart messaging, but Amazon seems to suggest that if forced to choose between selling the same products on its platform and offering a third-party marketplace, it would choose the former.

The CEOs of Google, Facebook, Amazon and Apple testified at a congressional hearing on antitrust cases last year.

google

Google can be affected by the legislation on multiple fronts.

Under the Jayapal Act, Google may have to fire some companies if regulators at the Department of Justice or the Federal Trade Commission prove a conflict of interest.

For example, Google may face a court order to sell YouTube or parts of its advertising process if it is determined to give Google the ability to handle itself or thwart the competition. A Congressional fact sheet published alongside bills that specifically set out how “no search engine can own a video service that has incentives to favor it in search results” — as close as lawmakers can determine the goal of the legislation.

A bill led by Representative David Cicilline would block the ability of tech giants to raise the bar for their services and products over those offered by competitors, which could impose huge new obligations on Google’s search business.

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“The first case will be Yelp v. Google,” Hal Singer, an economist and antitrust expert at George Washington University, predicted. for years, howling (howling) Google allegedly hurts competition in local search when it prioritizes its restaurant ratings over high-quality Yelp ratings. Google did not immediately respond to a request for comment, but has previously said that its search engine is designed to provide users with the answers they are looking for in the most effective way.

(The legislation’s proposed restrictions on self-preferential search order would similarly apply to the Amazon Marketplace and the Apple App Store, where search is an essential function.)

an Apple

The Cicilline bill clearly targets Apple’s restrictions on app developers. The company has been accused of blocking apps like Spotify and Fortnite from cheating Apple’s in-app payment system, with Apple collecting a 30% fee on sales within iOS apps. Under the new legislation, Apple could not prevent app makers from linking to third-party payment alternatives.

Apple said Wednesday that billing could open the door to third-party app stores for iPhones — a potentially massive disruption to Apple’s walled garden ecosystem that currently makes the Apple App Store the only source for iOS apps.

To drive the point home, Apple sent a letter to lawmakers in the House of Representatives on Tuesday and released a white paper on Wednesday stating that allowing others to sell access to iOS apps would reduce user privacy and security. The paper said Apple’s app tracking transparency requirements for iPhone apps, for example, won’t necessarily be implemented by a third-party app store.

Allowing users to download apps that have not been vetted by Apple “would spur a flow of new investment in attacks on the iPhone, spurring malicious actors to develop tools and expertise to attack the security of iPhones on an unprecedented scale,” the paper said.

Representative David Cicilline (D-RI) co-sponsored all six proposed antitrust bills for the House of Representatives.

Facebook

Many of the bills affecting Facebook focus on the company’s control of user data and its acquisition strategy.

Facebook has come under fire for allegations it sought to buy or clone its social media rivals, including buying Instagram for $1 billion in 2012.

Under one bill, tech giants determined by the Federal Trade Commission or the Department of Justice as meeting the criteria for the legislation cannot buy competitors or future companies that would enhance the giants’ ability to maintain their dominance against a direct competitor. Another bill seeks to make it more expensive for companies to file the paperwork for a merger, which could mean funding millions more for antitrust enforcement agencies.

In short, billing can make it difficult, if not impossible, for Facebook to buy the next Instagram.

In a statement, a Facebook spokesperson said the bills “underestimate intense competition within the technology sector,” including from foreign companies such as TikTok, WeChat and Alibaba.

“The surest way to address the challenges facing the Internet today is to address areas of greatest importance to people such as content modification, election integrity, and privacy — not trying to unravel the products and services that people rely on,” the spokesperson said.

Microsoft

Despite its enormous size and reach, Microsoft (MSFT) He was not among those accused of abuse of monopoly power by a landmark report following the House Judiciary Committee’s antitrust investigation last year.
Cislin did not say definitively whether Microsoft would be a “covered platform” as defined in the legislation, though he cautioned that Amazon, Apple, Facebook and Google likely won’t be the only companies that will meet the coverage criteria. Under the bills, companies with a market capitalization of $600 billion or more that have at least 50 million monthly US users or 100,000 monthly business users will be subject to the new laws.

But Microsoft President Brad Smith told Bloomberg in a recent interview that “there are aspects of the legislation … that fully apply to Microsoft.” He refused to go into details.

Microsoft has a market capitalization of about $2 trillion, and many of its products exceed the billing usage limit.

the look

Even if the legislation is passed, the change will not happen automatically. To successfully break up a company or prevent it from engaging in prohibited behavior, the Federal Trade Commission or the Department of Justice will first need to determine that it meets the definitions outlined in the legislation. After that, regulators still have to file – and win – a lawsuit alleging that the companies violated the new laws.

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Even so, some of the legislation being considered includes get-out-of-jail cards, where companies with a compelling justification for their behavior can avoid prosecution. For example, under Cicilline’s nondiscrimination bill, tech giants can escape liability by providing evidence that their practices do not overburden other business customers, or by showing that the behavior was necessary to protect user privacy or confidential data.

Singer said that a regulatory agency like the Federal Trade Commission likely wouldn’t file a case under some of the examples cited by the Progress Chamber. “There are so many nefarious, anti-competitive self-preferences that you’ll never go after things that aren’t harmful.”

You still shouldn’t underestimate the tech industry’s ability to fight laws — inside and outside the courtroom, said William Kovacic, a professor of law at George Washington University and a former chair of the Federal Trade Commission.

“One would imagine that they would spend a wealth of resources on lawyers, economic consulting firms, technical experts, public relations specialists, and all the arts that make Washington a thriving regulatory capital, to oppose that,” he said.