Time’s up for Big Tech? — moving towards antitrust reform and regulation
For years, academics, policymakers and activists alike have been calling for harsher regulation on “Big Tech” such as Google, Facebook, and Amazon. The issue famously even launched the current chairwoman of the Federal Trade Commission into her current role. These groups have long argued that the current antitrust framework, which utilizes consumer welfare as impacted by price fluctuations in the market as the gage anticompetitive harm, is ineffective against the unencumbered market power of these Silicon Valley giants. The problems go beyond simple market monopolization: there are issues of tax avoidance and concerns about data privacy Given the extent to which Big Tech is intertwined with our daily lives, the problems are nothing short of distressing.
At the same time, US regulators have on the whole been slow to catch up with technological developments or implement any form of regulation that would impact the actions of these behemoth technology companies. This is diametrically opposed to the stance of their European counterparts, who have favored more heavy-handed regulation.
However, the momentum has recently been building for a radical shift in the US approach, thanks largely to key political decisions made by the Biden administration and backed by bipartisan cooperation. In mid-October 2021, the Senate Judiciary Committee Antitrust Subcommittee introduced the American Innovation and Choice Online Bill and approved the legislation at the end of January 2022. The Act applies to all online platforms meeting certain usage or market capitalization requirements. In general, these platforms would not be able to prejudicially favor their own products at the expense of their competitors or use non-public data generated by their platforms to sell their products to a user.
The industry reaction to the bill has been mixed – larger companies like Apple and Amazon have lobbied to prevent the progression of the bill and warned that the bill could disrupt their service. Smaller tech companies, like Yelp, have expressed clear support, testifying that the bill would prevent Big Tech from abusing their dominant market positions. Nevertheless, there is one that is for certain: the tides are starting to turn against Big Tech and as such, the American Innovation and Choice Online Act could be a watershed moment for tech regulation.
While the US’ much needed antitrust law reform is rather welcome, it ought not to be the only regulatory tool employed to reign in the market power of Big Tech – addressing anti-competitive behavior only partly confronts the more nuanced issues that Big Tech has introduced. Importantly, antitrust enforcement tends to be reactionary rather than ex ante policy that would address the root of the problem rather than the symptoms. For example, stronger federal data policies, another area in which the US has been lagging behind its European peers, are needed to protect users’ data online. But, until the bill becomes law, it remains to be seen whether this watershed moment will be realized.
Iqra Bawany serves as a Graduate Editor of the NYU Journal of Law & Business. She is an LL.M. candidate at NYU specializing in International Business Regulation, Litigation and Arbitration. Prior to attending NYU, she studied Law at the University of Cambridge.