Apple, Alphabet, Amazon, and Facebook Called to Congress

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Some of the largest technology companies in the USA have yet again been called to testify at the House of Representatives to testify. They have been called many times before. This time it is on competition. Some have alleged that each of these companies has done something to hinder competition and they are being called to speak on it. In a letter written to these companies the House has asked that the CEOs of these companies be the ones to testify. They are also asking the companies to produce documents that were generated in response to competition. If the companies do not produce documentation they may be subpoenaed and obligated to produce it anyway.

For Apple the only way to publish an application is through the Apple App Store. For applications published thay way Apple earns a portion of the sales and subscriptions. Apps sold through the App store cannot advertise paying for services through means other than the App store.

Alphabet (the parent company of Google) has been accused of anticompetitive behaviours along several fronts. This includes giving preference to Alphabet provided serviced in Google searches and having an extensive advertising vertical.

Amazon is a bit unique. Previous anticompetitive cases have focused on consumer welfare. But Amazon’s practices haven’t met past criteria for poor consumer welfare. Amazon has access to lots of sells data and the computational and AI capabilities for profitably using that information and under pricing those that sell through their service.

Facebook has been accused of cutting developers off from their services to serve their own purposes. They have also purchased other services that might have competed with them otherwise (ex:Instagram). Some competitors have described Facebook as an unlawful monopoly.

Whether or not these companies engage in anticompetitive behaviour is a topic of debate. This hearing is part of an ongoing investigation into competition in technology. At the same time the EU is launching an anti-competitive investigation on Apple’s App Store and on Apple Pay. The investigation is based on a complaint from Spotify from last year and a complaint from an unnamed ebook/audio-book distributor. Their complaints are on the fee that must be payed to Apple for services purchased through the user’s iOS device and the prohibitions on communicating to users how they can upgrade their services through other means. For Apple Pay the investigation is on that being the only contactless payment solution that can be deployed to the iPhone. Especially at a time when there is increased interest in contacless transactions in the wake of COVID-19.

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