Two bills recently introduced are at the center of Big Tech’s battle against the proposed antitrust legislation. The American Innovation and Choice Online Act (AICOA) and the Open App Markets Act have resulted in the tech industry spending millions in expensive lobbying and advertising campaigns. Big Tech leaned on many lobbyists, including ones with professional and personal ties to lawmakers, to urge opposition to the antitrust efforts. Tech giants’ supporters spent over $100 million on ads in swing states warning that Congress would “break” Amazon Prime, encourage cyberattacks against the US, and undermine data privacy. Amazon, Google and Apple say the proposed antitrust legislation would make it harder to offer popular services. In addition, they claim that it is fair for e-marketplaces, search engines and app stores to profit off their own innovations. In the first three months of 2022, Apple had already spent $2.5 million on lobbying, a new quarterly record for the technology company. During the same period Meta spent $5.4 million on lobbying, with $5.3 million spent by Amazon and $3.5 million by Google.
Supporters of the bills, including some smaller technology companies, assert the platforms’ dominant position gives them unrestrained power to impact the fate of other businesses. They believe that restricting the platforms’ conduct would carry significant benefits. The AICOA bill was endorsed by the Biden administration’s Justice Department. Here is an opinion piece we found of interest relating to Big Tech’s argument against antitrust legislation.
Big Tech’s National Security Red Herring
In an opinion piece “Big Tech’s National Security Red Herring” for the Heritage Foundation, Michael Ellis, visiting fellow and Kara Frederick, director, discuss two bills – the AICOA which would prohibit Big Tech companies from giving an advantage to their own products on the platforms they operate. The Open App Markets Act which would open Apple and Google’s mobile app stores to competition from third-party software developers. While both bills gained bipartisan support in committee, the Biden Administration has announced its support for AICOA. In response, Big Tech companies launched a lobbying campaign to oppose the two bills. One goal of the campaign is to shift the legislative debate away from the substance of the antitrust reforms and into new areas, including the claim that antitrust reform will harm U.S. national security.
The authors argue that the campaign is an attempt to distract from the anticompetitive conduct of Big Tech companies, and there is little connection between the substance of the proposed antitrust reforms and their opponents purported national security concerns. The dominant global market share of Big Tech companies provides many economic advantages for the United States. It also results in incentives to seek favor with U.S. adversaries to acquire access to their consumer markets. The authors believe that many of the legislative reforms under consideration have been designed specifically to mitigate any national security concerns. According to them, other policy tools can be employed to counter threats to cybersecurity and data privacy from adversaries like China and Russia. The authors urge policymakers to reject Big Tech–funded national security appeals and instead consider antitrust reforms on their merits. They suggest competition, not Big Tech monopolies, will produce the innovation that America needs. Read more on Heritage Foundation.
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 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.
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