On Wednesday, the four most powerful people on the planet testified before Congress. The CEOs of Amazon, Apple, Facebook and Google, who together control companies worth nearly $ 5 trillion. USD, – were invited individually by videoconference and corrected the question for almost six hours. Some questions were difficult. Some were just everywhere.
It was a scattered and sometimes uncomfortable hearing. The members of the Judiciary Subcommittee of the Antitrust Chamber were given only five minutes at a time to ask questions to all four leaders. The event was also full of all the technical problems that can be expected in a standard video chat, as well as some expected but still distracting political drama.
Democrats have focused on whether companies are anti-competitive practices that oppress competitors and harm consumers. Many frustrations for Democrats, many Republicans have shifted from antitrust issues to focus on unfounded claims of anti-conservative bias on social media and Google platforms.
Although the marathon hearing will not lead to any immediate political or regulatory action, it may put pressure on antitrust regulators at the FTC and DOJ and provide a basis for broader government investigations into the companies’ business practices and laws that have not been thwarted. The event also affects public opinion about technology at a time when almost half of the country believes the industry needs government regulation. Naturally, some came out of the debacle, similar to the winners. There were obvious losers.
Rep. Promila Jayapal
Pramila Jayapal, a member of the Democratic Congress in Washington, D.C., prepared with sharp questions for witnesses, especially for Amazon CEO Jeff Bezos and Facebook CEO Mark Zuckerberg, who was in a hurry to buy her then-rival Instagram in 2012.
Jayapal directly quoted internal documents to put pressure on Zuckerberg when he repeatedly denied Instagram founder Kevin Sistrom the deal. Instead of moving on to another issue, Jayapal read old emails and strategically reminded Zuckerberg that he had sworn to tell the truth. After a tense step back and forth, the CEO of Facebook told Jayapalu that he disagreed with the description of his messages to Systrom.
“I think it was clear that this is a space where we are going to compete one way or another,” Zuckerberg said. “I don’t see these conversations as a threat.”
But Jayapal, who has clearly done his homework, had more evidence, citing reports in which Systrom shared with its investors concerns that Zuckerberg would go into “destruction” mode, copying and crushing his app if he rejected the deal.
“Facebook is a case study with monopoly power, because your company collects and monetizes our data, and then your company uses that data to spy on competitors, copy, buy and kill competitors,” Jayapal said at the end of his conversation. for a deal on Instagram.
Jayapal’s questions provided some of the most formidable evidence presented during the antitrust hearing. He demonstrated how dominance in the Facebook market can cause fear among competitors, even if it is not yet determined whether it meets the legal threshold of anti-competitive behavior.
Although his company has faced heightened allegations of antitrust violations in recent weeks, Apple CEO Tim Cook has received only about half the number of questions as his rivals for technical management, according to a VentureBeat analysis.
Cook has faced some difficult questions about whether Apple is shrinking too much from the revenue of third-party developers selling apps in its App Store. For example, Spotify complained very publicly about this issue, as a result of which European regulators launched a couple of antitrust investigations in June. However, on Wednesday, members of Congress did not focus on Apple’s problems, as on other technical leaders.
Overall, Cook won by lying low. Today, Cook skillfully keeps quiet when he needs to win the Trump-era hyperparty politics. Wednesday’s hearing was no exception.
The CEO of Facebook, who had previously testified at congressional hearings, has faced some of the most difficult issues from lawmakers on both sides. Some claim that the young executive was questioned, but the fact that Zuckerberg became the center of such a large number undoubtedly drew negative attention to Facebook.
Democrats have insisted on Facebook for its inability to stop the spread of hate speech and misinformation on the platform. But where Zuckerberg fought, he found himself polling members like Jayapal, who looked at the hard cases of Facebook’s anti-competitive business practices for years in what Jayapal called a “copy, buy, and kill” strategy to promote competitors outside of business.
Zuckerberg defended Facebook in several ways. First, he argued that if Facebook had not acquired smaller competitors such as Instagram, these startups may never have succeeded on the scale they are today because they need Facebook’s support and talent to grow. Second, Zuckerberg said Facebook is not really a monopoly because it competes with companies such as Google in advertising, Amazon in commerce and TikTok in social media. Third, he argued that if US regulators smashed giants such as Facebook, other Chinese competitors (hint: TikTok) who were “less committed” to American values could take over.
But Zuckerberg on the grill from Congress did not stop with the acquisitions. Zuckerberg has faced a series of angry questions from Republicans, who have accused meager evidence that Facebook is inherently biased against conservatives. Even if these claims are unfounded, they left Zuckerberg, defending his company from all points of view.
Sundo Pichai, the CEO of Google, known for his quiet speech, was forced to argue at Wednesday’s hearing when he faced a breach of Google’s privacy practices and dominance in the advertising market.
Like Zuckerberg, Pichai ended a lot of hell over Google’s almost baseless allegations of political bias. But the guerrilla republican attacks did not end. Several Republicans, such as rap. Ken Buck and Matt Goetz also decided that Google had abandoned a major contract with the Pentagon to develop an AI to be used in the fight against drones. The project, nicknamed Maven, was partially rejected due to the open dissatisfaction of thousands of Google employees, claiming that they did not register in the war business.
In his survey, Pichai acknowledged that staff anger at Maven was the result of a decision to abandon the project, which is an obvious and understandable conclusion that the rap. Goetz insulted the bomb as a revelation. Pichai also said that the company is actively cooperating with US government agencies.
“We do not work with the Chinese military.”
Rep. Gaet asks Google why US company will help Chinese military pic.twitter.com/yG1r9oR8w7
– Bloomberg QuickTake (@QuickTake) July 29, 2020
However, all this puts Pichai in a difficult place. On the one hand, he must keep his engineers – a narrow pool of talents who are known to be difficult to recruit – happy. And many of these engineers are adamantly against the development of technology that can cause physical harm. At the same time, as testified at the hearings, Pichai has to answer to angry lawmakers who consider any refusal not to participate in military or police contracts to be unpatriotic.
Google’s previous work to create a search engine under strict Chinese Communist Party censorship has also been questioned by Republicans, who have accused Pichai of adhering to the Chinese government.
For Google, this is important because the company is likely to face potential antitrust action in the near future. The Republic-led DOJ is expected to file a lawsuit against Google this summer. So you can say that there was no chance to beat Pichai on Wednesday.
Both winners and losers
Amazon’s CEO and the world’s richest man was calm, polite, and mostly straightforward in his responses to his first address to Congress. He also survived more than an hour at the beginning of the hearing without asking any questions due to a reported technical problem, and did not face the fact that the “internal documents” of the chicken gun “could make it tougher” when the inquiries finally began.
But Bezos’s testimony has little allayed the various concerns about Amazon’s power of about 1.7 million small and medium-sized resellers. These include suspicions about how a company uses data to develop competing products, as well as a tendency to suspend or ban sellers with little notice or explanation. Bezos was also specifically called upon to increase the sales cuts that Amazon charges from retail sellers – the amount they have to pay to succeed in the giant trade market.
Faced with Amazon’s anecdotes or accusations of abuse of power as ruler of his market square, Bezos would express his displeasure, promising to sort it out and try to reassure lawmakers that the problems were not systemic. Even if he is right and the abuse is a series of one-off actions, the model shows that Amazon has grown so powerful that it can massively disrupt or transform its own affiliates – even through neglect or accident.
Rep. Jim Jordan
A member of Congress in Ohio was the most outspoken of his Republican counterparts in attacking the tech giants, arguing that they censored or suppressed conservative views in various ways. “I’m just cutting the chase. Great technology is there to get conservatives,” he said in his opening statement. So if success for Republicans was based on airing as many unproven theories of bias as possible, Jordan was a star. And if you watched the hearing and didn’t know who he was before, you certainly are now.
But Jordan has spent precious opportunities asking difficult questions to technical titans about the real challenge: documenting whether they are abusing power over partners and competitors. To some extent, these hearings are a form of theater, and most politicians are looking for an attractive sound that shows them that they are telling the truth to the authorities. If you give an amazing show for a show other than what the audience paid for, then you deserve to be picked up on stage.
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