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Why the attack on Big Tech could be destined to fail

The report also suggested that platforms should assume a role akin to a utility like the electricity grid.

Sam Bowman, director of competition policy at the International Law Economy Centre, said the proposed changes read like the “most extreme wish list” for anyone who hated Big Tech. “It’s ridiculous, it ends up reading like they tried to frame every single possible behaviour by these companies as harmful and anti-competitive, which is far-fetched,” he said. “No neutral reader could look at that report, and not realise that they’re reading a political document.”

Without core law changes, we believe this antitrust momentum hits a brick wall.

Dan Ives, managing director at Wedbush Securities

Bowman said there was nothing in the report that demonstrated or alleged consumer harm. Instead, it focused on harms to competitors which were “alien” to American and British policy and “much more in line” with European norms. The European Commission has taken a hard line on Big Tech, and imposed heavy fines for anti-competitive behaviour.

“I think where this will probably land – and this is still really bad – is this kind of forced interoperability, basically treating platforms as a utility,” Bowman said.

Some Republicans back elements of the report, but do not go so far as to endorse Congress to intervene and restructure tech firms. Colorado’s Ken Buck said he agreed with three quarters of the report, but not with recommendations around breaking up the giant businesses.

Dan Ives, managing director at Wedbush Securities, said the differences between Republicans and Democrats on how to tackle tech’s dominance made wide-scale change unlikely. “Without core law changes, we believe this antitrust momentum hits a brick wall,” he said. He added that both parties had struggled to gain a consensus on “more pressing issues” and, as a result, made agreeing to new laws on tech unlikely.

The subcommittee spoke to employees at the companies and their rivals to determine if competition had been unfairly crushed. As the inquiry neared its conclusion, the heads of all four firms were called to testify against allegations of monopolistic behaviour.

Big Tech has undergone exponential growth over the past decade with the combined valuation of all four now at more than $US5 trillion ($6.9 trillion).

Christopher Rossbach, fund manager at London-based investor J Stern & Co, said that the report provided a “blueprint for regulation” if Democratic Joe Biden was elected. “It confirms our view that the Democrats will investigate past acquisitions like Instagram by Facebook and Doubleclick by Google, and raise the possibility of breaking up parts of the companies as one of the remedies,” he said. “Traditional antitrust focuses on harm to consumers. The simplest harm is higher prices. However, the Big Tech platforms are free to consumers, have increased choice and lowered prices.”

A range of investigations into the tech firms are ongoing across the US, with the contents of the report likely to encourage prosecutors.

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The justice department and several states are looking into Google while the Federal Trade Commission is examining Facebook’s moves for Instagram and WhatsApp. Both are believed to be exploring if Amazon is abusing its position of power to promote its own products. Apple has also drawn the attention of the justice department for its commission charged on App Store sign-ups.

Telegraph, London

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