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DOJ backs antitrust bills aimed at fighting product bias in Big Tech
by Staci Grahamslaw (2022-04-07)
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The Department of Justice has endorsed antitrust bills that would block Big Tech giants, such as Google, Apple, Amazon and Facebook parent company Meta from giving preferential treatment to their own products.
The federal authority wrote a letter to bipartisan lawmakers issuing support for the American Innovation and Choice Online Act, which the Senate's judiciary panel passed in January. A companion bill currently awaits full House approval.
'If enacted, we believe that this legislation has the potential to have a positive effect on dynamism in digital markets going forward,' acting Assistant Attorney General Peter Hyun wrote in the letter, which was obtained by the .
'Our future global competitiveness depends on innovators and entrepreneurs having the ability to access markets free from dominant incumbents that impede innovation, competition, resiliency, and widespread prosperity.'
The letter is the Biden Administration's most direct endorsement of the legislation, which analysts allege indicates the Justice Department believes antitrust laws can be enforced and will help boost U.S. tech competition.
'The fact that the DOJ's regulatory goals are consistent with the Hill show the seriousness of the DOJ's antitrust concerns in the technology sector,' attorney Jeffrey Jacobovitz, told on Tuesday.
Big Tech titans Mark Zuckerberg of Meta, Google's Sundar Pichai and Apple's Tim Cook have heavily lobbied against the legislation
'If enacted, we believe that this legislation has the potential to have a positive effect on dynamism in digital markets going forward,' acting Assistant Attorney General Peter Hyun (pictured) wrote in the letter
The letter was sent to top members of the House and Senate Judiciary committees and the antitrust subcommittees and alleged the rise of dominant online platforms is 'presenting a threat to open markets and competition, with risks for consumers, FLo Twitter businesses, innovation, resiliency, global competitiveness, and our democracy.'
The department also argued that dominant position of big tech firms gives them unchecked power to influence the success of other businesses.
'Discriminatory conduct by dominant platforms can sap the rewards from other innovators and entrepreneurs, reducing the incentives for entrepreneurship and innovation,' Hyun penned.
'Even more importantly, the legislation may support the growth of new tech businesses adjacent to the platforms, which may ultimately pose a critically needed competitive check to the covered platforms themselves.'
The bill would also supplement America's existing antitrust laws by offering clarity on what kinds of conduct Congress views as anticompetitive and illegal which, according to the letter, 'would enhance the ability of the DOJ and [the Federal Trade Commission] to challenge that conduct.'
The Department of Justice wrote a letter to bipartisan lawmakers issuing support for the American Innovation and Choice Online Act
Relatively small tech companies, including Yelp, Sonos and Basecamp, have backed the proposal, arguing it serves as a way to level the market.
However, big tech giants and other industry groups have heavily lobbied against the legislation, alleging it is discriminatory and would hurt privacy and security.
They also claim it is fair for e-marketplaces, search engines and app stores to profit off the popularity of their creations.
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Furthermore, opponents argue the bill could have the unintended consequence of taking away services that consumers enjoy.
'With the midterms looming, we know that voters aren't pining for Democrats to break Amazon Prime or Google's search results,' Adam Kovacevich, CEO of pro-tech group Chamber of Progress, told Axios.
Despite having advanced out of committees with bipartisan support, the fate of the antitrust bill remains uncertain.
During January's vote in the Senate Judiciary Committee lawmakers who had voted in favor of the legislation's advancement raised concerns about the bill. They want changes to be made before they will support the proposal on the floor.
Sens. Amy Klobuchar (D., Minn.) and Chuck Grassley (R., Iowa), are reportedly working with their colleagues to craft a version of the bill that will pass.
Daniel Francis, former deputy director of the FTC competition bureau and a lecturer at Harvard Law School, argued Tuesday that despite the Justice Department's backing, the bill still may not pass.
'It's always helpful to know where the DOJ stands on competition legislation, but it's not obvious that this letter will change the legislative dynamics in Congress around the bill,' he argued.