The Big Tech’s overarching global reach has for long been growing in tandem with a widening trust deficit vis-à-vis both users and regulators.
In the US, of late, attorneys general from Massachusetts and Pennsylvania have now joined a growing list of officials from California, New York, Washington State and the Federal Trade Commission looking at Amazon.com for potential antitrust violations.
The rise of technology superpowers like Microsoft, Amazon, Apple, Facebook, and Google has created new challenges for the competition watchdogs across the world.
Germany’s antitrust regulator last week opened an investigation into Google over anti-competitive practices, wielding a new law that has already been used to scrutinise other US tech giants.
Ireland’s data regulator has recently been given the court permission to resume a probe that may trigger a ban on Facebook’s transatlantic data transfers.
In China, the watchdog in April levied a record $2.8bn fine on Alibaba and ordered its 34 largest tech corporations to pledge compliance with regulations.
In the final months of the Trump administration, the Justice Department sued Alphabet’s Google, while the FTC sued Facebook over allegations they violated antitrust laws.
Those are the biggest antitrust actions against a tech giant since the US sued Microsoft more than two decades ago.
Late in 2020, the House Judiciary Committee’s antitrust subcommittee released a report accusing Apple, Amazon, Google and Facebook of abusing their market power.
Make no mistake, the tech giants are powerful.
In the US, Google and Facebook together collect more than half of digital advertising spending and Apple has about half the smartphone market, says a Bloomberg report.
The House antitrust report estimated that 50% or more of US e-commerce sales goes through Amazon; that 99% of mobile devices in the US and globally run on Apple’s iOS or Google’s Android systems; that Google captures about 89% of all general search queries in the US; and that Facebook’s app reached 74% of US smartphone users as of December 2019.
The Big Five – Alphabet, Amazon, Apple, Facebook, and Microsoft – made more than 600 acquisitions in the last decade worth more than $200bn.
None may be more controversial than Facebook’s acquisition of Instagram in 2012. Critics say the takeover eliminated an emerging competitor.
The companies also have control over vast amounts of data about their customers, raising concerns about threats to privacy.
European data protection authorities, which under the European Union’s strict privacy laws, are empowered to fine companies as much as 4% of global annual revenue if they breach the bloc’s rules.
The EU brought three antitrust actions against Google in as many years carrying penalties that totalled $9.3bn.
Silicon Valley executives are waking up to the backlash, striking a more conciliatory note, and saying they want to work with authorities on a range of challenges.
As a matter of fact, antitrust lawsuits are hard-to-win, long-drawn-out fights, especially in the US.
Heavy fines can easily be shrugged off by the cash-rich giants. Also, regulations aimed at specific practices often fall behind in the fast-moving technology sector.
Whatever the outcome, though, the bludgeoning slew cases may go a long way to reshape industry structures, markets, and even the emerging technologies.
