AICOA to Promote Competition in the Digital Marketplace

AICOA to Promote Competition in the Digital Marketplace

By The Fatty Fish Editorial Team - April 27, 2022

The American Innovation and Choice Online Act (AICOA) is a bill proposed to promote competition in the digital marketplace by addressing antitrust concerns related to major technology companies. The goal of AICOA is to prevent monopolies by prohibiting dominant platforms from abusing their gatekeeping power, favoring their own products, and disadvantaging competitors. AICOA proposes that the Federal Trade Commission (FTC) and the Department of Justice (DOJ) enforce new antitrust and anticompetitive regulations. The regulations include prohibiting:

Dominant platforms from preventing other businesses’ products or services from interoperating with the platform.
Requiring a business to buy a dominant platform’s goods or services.
Preferential gatekeeping placement on its platform.
Misuse of a business’ data to compete.

The proposed legislation only applies to the largest online platforms, which must be a “website, online or mobile application, operating system, digital assistant, or online service.” AICOA qualifying platforms must:

Enable users to generate or interact with content, facilitate e-commerce, or enable user searches that display large volumes of information.
Have at least 50 million U.S. monthly users or 100,000 U.S.-based monthly active businesses.
Have a market capitalization or a total U.S. net sales exceeding $550 billion and serve as a “critical trading partner” for business users.

The passage of AICOA would have an impact on most US citizens. Companies such as Apple, Alphabet, Amazon, and Meta would be affected. Almost half of Americans utilize an Apple iPhone, while almost 70% of adults use Meta (formerly known as Facebook). In addition, almost half of the US population uses Amazon Prime, and 70% of Americans, or 268 million individuals, shop online. Here is an opinion piece we found of interest relating to the support by Commerce Secretary Gina Raimondo of AICOA to promote competition in the digital marketplace.

Raimondo supports Senate tech antitrust bill

In an opinion piece “Raimondo supports Senate tech antitrust bill” for POLITICO Pro, Rebecca Kern and Emly Birnbaum, reporters, discuss the backing of the American Innovation and Choice Online Act by Commerce Secretary Gina Raimondo. Her backing of AICOA aligns her with the Biden administration’s Justice Department, which sent a letter supporting the bill. The proposed bill aims to block tech giants from giving preferential treatment to their own products and services. Her support is a contrast with her past statements defending tech companies from similar European proposals. Raimondo had previously argued that proposed European regulations would “disproportionately impact US-based tech firms.” While testifying before the Senate Commerce Committee, she said “I clearly agree that we need to improve competition, which increases innovation.” She added, “last month, the Department of Justice (DOJ) released a views letter on behalf of the administration in support of the American Innovation and Choice Online Act, and the department and I certainly support that and concur with the aim of the legislation and the views expressed in that views letter.”

AICOA would block dominant online companies such as Amazon, Apple, Meta and Google from preferencing their products and discriminating against rivals on their platforms. Raimondo also voiced her support behind the Kids Online Safety Act. The proposal would require social media platforms to take additional measures to keep children under 16 safe online, including by providing families with safety tools and additional transparency measures. Read more on POLITICO Pro.

Disclosure: Fatty Fish is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

The Fatty Fish Editorial Team

The Fatty Fish Editorial Team includes a diverse group of industry analysts, researchers, and advisors who spend most of their days diving into the most important topics impacting the future of the technology sector. Our team focuses on the potential impact of tech-related IP policy, legislation, regulation, and litigation, along with critical global and geostrategic trends — and delivers content that makes it easier for journalists, lobbyists, and policy makers to understand these issues.