facebook – j2i.net

Today, July 29, 2020, the CEOs of four technology companies will meet virtually with a House subcommittee about their market power. Some have asserted that these companies have monopolies or near-monopolies. Time Cook of Apple, Mark Zuckerberg of Facebook, Sundar Pichai of Google, and Jeff Bezos of Amazon will be present. There was a push for Jack Dorsey of Twitter to attend from representative Jim Jordon of Ohio, but he is not expected to attend.

These companies are being investigated for their market dominance. For Apple, a key issue is that the only method of distribution to iOS devices is through the Apple App Store. While it is the case for a number of consumer devices that the device manufacturer is the only entity that can decide if an application will be available to the device (ex: Nintendo licensing games for the Switch, Sony for the Playstations, Microsoft for the Xbox) some entities have asserted that the arrangement is unfair. Most notably Spotify made a complaint about the revenue split terms for the Apple App Store and being disallowed from advertising other ways that a customer may purchase its service that do not involve Apple.

Amazon’s use of data that is has collected is in question. It’s combination of customer data, seller data, and its intelligence capabilities give it a significant advantage. Not only does Amazon sell items from third parties, it also produces its own products that compete with those providers. There is a question of it being fair.

For Facebook’s acquisition strategies are in question. And it also has a large advertising network that is being scrutinized.

Google, in addition to having the worlds most popular search engine, also has a wide advertising network. Google also gained the attention of regulators in the European Union because if its search engine giving preference to Google products for some types of searches.

Live-streaming of the hearing will be available on YouTube at the following starting at 12:00PM Eastern Time today, 29 July 2020.

Livestream/Replay

This isn’t the first hearing that the committee has had, but it will be the first one at which these CEOs have all been present. In previous hearings in which representatives from Facebook or Google have been present it hasn’t been unusual for questions to not focus on the investigation, but to also be on other topics of interest. In addition to questions on the competition practices, I expect there to be questioned on censorship, with the most recent well-known instance being the removal of a group that called themselves “American Frontline Doctors.” The group held a live stream on Monday that made claims of a cure for COVID-19, stating that masks offer no question, and made many other statements that contradict the advice of health organizations. The video was removed by Facebook, Twitter, and YouTube in addition to SquareSpace deciding to terminate their hosting agreement for the group’s site.

Previous hearings from the sub-committee are also available for viewing.

Free and Diverse Press (June 11, 2019)
H.R. 3942, Preventing the Sale of E-Cigarettes (June 11, 2019)
Competition in Labor Markets (29 October, 2019)
The perspective of the Antitrust Agencies (2019 November 13)
Competitors in the Digital Economy (Jan 17, 2020)
Online Platforms and Market Power (July 29, 2020)

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.