Lawmakers are concerned about competition in spaces which these tech companies are operating in.
A House Judiciary Committee Subcommittee led by David Cicilline (D-RI) will be speaking with big tech companies on antitrust issues. (Image: Getty Images)
Big tech companies are back in the limelight. A US Congressional panel will be hearing the submissions made by executives from Apple, Google, Facebook and Amazon, with specific focus on investigating competition in the technology sector. Lawmakers are concerned about competition in the spaces which these tech companies are operating in, including social media, and how that impact consumers. The hearing will be held by the House antitrust subcommittee, led by Representative David Cicilline (Democrat-Rhode Island), reports Bloomberg. The executives who are expected to appear for the hearing include Adam Cohen who is the Director of Economic Policy at Google, Amazon’s Associate General Counsel Nate Sutton, Matt Perault who is Facebook’s Head of Global Policy Development and Kyle Andeer, Apple’s Chief Compliance Officer. It is expected that former Federal Trade Commission (FTC) Chairwoman Maureen Ohlhausen will also testify.
But what is on the agenda for each of these companies? Facebook’s issues are perhaps the most serious. The FTC is going to fine Facebook as much as $5 billion for the Cambridge Analytica scandal which saw 87 million user profiles, without user consent, being used for political advertising on the basis of the data harvested. Facebook has subsequently been in the eye of the storm, with regulators globally insisting on stricter laws to govern tech companies including Facebook—including some suggestions that breaking down Facebook into smaller companies would be the best way forward for the social media giant. The investigators could further look at how Facebook has been doing its business over the past few years.
Google faces more antitrust battles, particularly with how it pushes its own services as part of the Android operating system for smartphones. The European Union has already fined Google as much as $5 billion last year for creating a situation where phone makers had no option but to push Google’s apps and services to be able to continue selling Android phones that users would want to buy. The debate revolves around how smartphone makers are required to install Google Search and the Chrome web browser apps on smartphones that they sell, as a condition to the license for accessing the Google Play Services. The Google Play Services are critical to any Android phone, as they include critical apps including Google Play Store and Gmail, as well as access to Android updates.
Apple is also facing an anti-trust battles in Europe, where music streaming service Spotify isn’t entirely chuffed about the 30 percent cut that it has to give for any in-app subscription that is paid for via the Apple App Store. Apple has countered this by saying that it takes a 30 percent cut for the first year, and this reduces to 15 percent after that. Important to note that Spotify stopped in-app subscriptions via the iOS app in 2016, and Apple says it takes a cut from the renewing subscriptions of 8,80,000 users—Spotify crossed 100 million paid subscribers in April this year.
Amazon, and also Google, have been called out by the US retail group The Retail Industry Leaders Association (RILA), which in a letter to the FTC has said that the two tech giants have control over majority of the online product searches and how the pricing as well as product information is shared with consumers.