Apple, Amazon, Facebook and Google face a reckoning over their dominance.
It’s fitting, though perhaps a bit anticlimactic, that when Mark Zuckerberg, Jeff Bezos, Tim Cook and Sundar Pichai convene on Wednesday for a highly anticipated congressional hearing, it will be over video chat.
Silicon Valley’s technology has changed the world, allowing people around the globe to stay connected even during an unprecedented pandemic. But the success of Facebook, Amazon, Apple and Google’s parent company, Alphabet — and the four men who lead those companies — has brought about another unprecedented phenomenon: the stunning amount of control Silicon Valley has over what the world sees, reads, buys and does online.
How much control? Facebook is the world’s largest social network, with a user base roughly equal to the world’s two most populous countries combined. Amazon controls 38% of US online sales — Walmart, its nearest competitor, had just shy of 6% — and has data on other retailers using the giant platform. Apple’s App Store is a powerful gateway for software developers to find an audience with the company’s massive iPhone and iPad customer base. And Google processes about 90% of all web searches globally.
The hearing, delayed by two days to accommodate a memorial for the late Rep. John Lewis, marks the first time lawmakers will have the opportunity to grill the CEOs of those four powerful companies at the same time. Officially, the topic is antitrust, the culmination of a more than year-long investigation into the market dominance of Big Tech by a House Judiciary subcommittee led by Rep. David Cicilline (pictured above), a Democrat from Rhode Island. In that time, the subcommittee has gathered more than 1.3 million documents from the tech giants, competitors and antitrust enforcement agencies for the investigation.
But politicians are known to go off-script, and the hearing is expected to become a free-for-all, touching on topics as varied as election security, political bias and relations with China.
Government officials have been wrestling with the power of tech companies for decades. In 1984, AT&T was broken into eight separate companies. Microsoft, the tech industry’s original baddie, was accused of having a monopoly on PC software in the 1990s, a landmark case that simmered into a settlement in 2001. The European Union also forced Microsoft to open its operating system to competitors and repeatedly fined it. But an industrywide reckoning that the hearing represents is uncharted territory.
The hearing is a rare public interrogation of Big Tech’s most important leaders at a crucial time. The US presidential election looms, the country is struggling with social upheaval over racial injustice and the world is staring down a deadly contagion. All the while, Americans are using tech’s services and devices to find information online, buy supplies, and download and stream entertainment while they shelter in place.
“They all control dominant platforms,” said Hal Singer, a senior scholar at the George Washington Institute of Public Policy, referring to the companies. “This is a good opportunity to get them all together and see if any patterns emerge.”
Separate battles
Each of the four companies is facing its own antitrust battle. All of them are reportedly targets of probes by the Department of Justice or a coalition of state attorneys general. Google and Facebook have confirmed various investigations, while Amazon and Apple haven’t publicly acknowledged them.
With Facebook, which was originally scheduled to report second-quarter earnings on Wednesday but moved them to Thursday, regulators are looking into the company’s acquisitions of competitors like Instagram and WhatsApp. For Amazon, Congress has largely focused on the company’s private-label business, which sells Amazon brands of clothing, food and consumer goods like batteries and diapers. Apple has seen scrutiny over the cut it takes from software developers on its app store. For Google, regulators are focused mainly on the search giant’s dominance in digital advertising.
At Wednesday’s hearing, all those disparate threads will intersect like a very wonky and nerdy crossover episode. Republicans have also called for Twitter CEO Jack Dorsey to join the hearing, in the wake of a massive security breach earlier this month. Dorsey isn’t on the witness list.
Adding to the intrigue is the newbie status of Bezos. Zuckerberg, Pichai and Cook have all testified before. (Zuckerberg, the youngest of the bunch, has the most experience testifying on Capitol Hill. In 2018, he fielded questions during two sessions, for almost 10 hours over two days, after the Cambridge Analytica data scandal. He also testified last year about Facebook’s planned Libra cryptocurrency.)
Despite his rising profile — and wealth — Bezos has never faced Congress. Last Monday, the fortune of the world’s richest person grew by $13 billion in one day alone, bringing his total net worth to almost $190 billion.
Bezos may have an uncomfortable day. President Donald Trump has taken personal shots at the Amazon boss, apparently over coverage by The Washington Post, which Bezos owns separately from Amazon. It’s likely Republicans allied with the president will pick up the baton and run with it. But there are also legitimate questions to ask about Amazon’s size and business practices.
A virtual affair
All high-profile congressional hearings are in part political theater, filled with pageantry and spectacle. When Zuckerberg testified before Congress two years ago, an activist group set up 100 cardboard cutouts of Facebook’s CEO on the lawn of the Capitol Building, imploring him to “Fix Fakebook.” Protestors dressed as bunnies and superheroes chanted slogans like “Zuckerberg, you’re absurd!” After he sat down for his first hearing, photographers snapped pictures of him for nearly a full minute before the proceedings could continue.
On Wednesday, the circus won’t be following the young mogul. The event will be conducted virtually, an accommodation to House rules because of the coronavirus pandemic. That means the hearing will lack the drama that comes with in-person visits to D.C. Cutting exchanges, like Rep. Katie Porter’s needling of Zuckerberg over his hairstyle last year, are unlikely to play out. Snappy timing is hard to perfect over Zoom.
Some observers have criticized the format of the forum. Having all four CEOs appear at once means they each get a fraction of the time in the hot seat. The attention would be more focused if each testified individually.
The hearing may be more show than substance. The real developments will come later. A landmark case against Google is expected to be filed this summer. Facebook awaits the findings of several probes, including one by the Federal Trade Commission. So the hearing is unlikely to be a game-changer, even if it will give the CEOs an opportunity to defend their companies in public.
People watching the hearing should lower their expectations, says David Balto, a former lawyer in the Justice Department’s antitrust division whose clients include tech companies. There is only so much lawmakers can accomplish in these settings, he says, and Congress should focus on trying to get a public commitment from the companies to reform their competition practices. That would mean, for example, getting Zuckerberg to commit against big acquisitions that “consolidate” the industry, like its buyout of Instagram.
“The hearing is tremendously significant,” Balto said. But “be ready for disappointment,” he adds, if you’re looking for big changes.
Source: https://www.cnet.com/news/four-of-the-biggest-tech-ceos-are-about-to-be-grilled-by-congress/
