Congress to investigate whether giant tech firms are guilty of ‘anti-competitive conduct’ as markets see tech stocks plummet

This article is more than 1 year old

This article is more than 1 year old

Congress is launching a bipartisan investigation into digital markets and the tech industry, looking into giants such as Facebook, Google and Amazon for “competition problems” and “anti-competitive conduct”.

“The open internet has delivered enormous benefits to Americans, including a surge of economic opportunity, massive investment, and new pathways for education online,” the House judiciary chairman, Jerrold Nadler, said in a statement. “But there is growing evidence that a handful of gatekeepers have come to capture control over key arteries of online commerce, content, and communications.”

In addition to “documenting competition problems” and looking into “anti-competitive conduct”, the committee will assess “whether existing antitrust laws, competition policies and current enforcement levels are adequate to address these issues”, lawmakers said in a joint statement.

Big tech has too much monopoly power – it's right to take it on | Kenneth Rogoff Read more

“Technology has become a crucial part of Americans’ everyday lives,” said Jim Sensenbrenner, antitrust subcommittee ranking member, in a statement. “As the world becomes more dependent on a digital marketplace, we must discuss how the regulatory framework is built to ensure fairness and competition.”

The announcement comes as US regulators, too, are moving to tighten scrutiny over the tech giants.

Earlier on Monday, US tech stocks dropped after reports that US antitrust officials were preparing to investigate companies such as Apple, Facebook and Google parent Alphabet.

Under an agreement with the US justice department, officials from the Federal Trade Commission are reportedly preparing to investigate any practices at Facebook that may harm competition in the digital market.

Separately, Reuters reported that the justice department had taken jurisdiction for a potential investigation of Apple, as part of a broader review of whether technology giants use their size to act in an anti-competitive manner.

And last week, the Wall Street Journal reported that the Department of Justice was looking into opening an anti-trust investigation into practices at Google.

The power and control over the market that these tech companies hold has become a hot-button issue , with presidential hopefuls weighing in on the question of whether it is time to break up these companies in the way that the US government once broke up the railroad, oil and steel monopolies.

The Democratic senator and presidential hopeful Elizabeth Warren has long argued the tech companies should face more scrutiny. “Today’s big tech companies have too much power – too much power over our economy, our society, and our democracy,” Warren said in a blogpost. “They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else. And in the process, they have hurt small businesses and stifled innovation.”

“I want a government that makes sure everybody – even the biggest and most powerful companies in America – plays by the rules,” she added.

Senator Kamala Harris, a 2020 hopeful from California, where the tech industry has boomed, has expressed that she thinks “we have to seriously take a look” at whether Facebook should be broken up.

“I think that Facebook has experienced massive growth and has prioritised its growth over the best interests of its consumers,” Harris said, “especially on the issue of privacy. There is no question in my mind that there needs to be serious regulation, and that that has not been happening.”

Congressman Ro Khanna, who represents Silicon Valley, issued a more tempered statement advocating for “strong antitrust enforcement” that will not hinder the promotion of “innovation and growth”.

“The House judiciary committee should hold tech accountable to strong antitrust enforcement,” he said. “But any investigation needs to be fact-based and lead to well-crafted regulatory outcomes. We should prevent anticompetitive platform privilege while promoting innovation and growth.”

Edward Helmore contributed reporting