Is Big Tech too big to work together?
Dec 17, 2021

Is Big Tech too big to work together?

Politico's Emily Birnbaum says the Internet Association's breakup shines a light on the deeper divisions among tech lobbying firms — and tech companies.

The tech industry is a powerful lobbying force here in Washington, working to shape government policy around technology regulations, trade agreements and privacy laws.

And a big player in that space has been the Internet Association. The 9-year-old trade group counts Google, Amazon and Meta as members.

Here’s the group’s leader, K. Dane Snowden, testifying before the Senate just last month:

“IA represents over 40 of the world’s leading internet companies on public policy. Our mission is to foster innovation, promote economic growth and empower people through the free and open internet.”

But this week, the Internet Association announced it’s closing at the end of the year.

That news is our topic for “Quality Assurance,” where we take a second look at a big tech story.

Emily Birnbaum broke this story. She’s a tech lobbying and influence reporter at Politico. And she explained just how much tech companies spend on lobbying.

Emily Birnbaum: Together, they spent $124 million in lobbying and campaign contributions. Amazon, Facebook and Google are consistently in the top 10 to 20 spenders in Washington. Last year, we know that Facebook spent $19.7 million, Amazon spent $17.9 million. All that to say — they spend more than Big Oil, Big Tobacco, some of the most important players in Washington.

Kimberly Adams: And where do trade groups like the Internet Association fit into this sort of political landscape of tech regulation and lobbying?

Birnbaum: Originally, it was sort of aimed at e-commerce. But over the course of a couple of years, as it grew and grew, it realized there was a niche for them as the voice for Silicon Valley. You know, “We’re going to represent the internet economy, we’re going to represent apps.” IA was one of the most important voices for the tech industry, and particularly the large platforms, in Washington until recent years.

Adams: And until it disbanded. What happened here?

Emily Birnbaum smiles towards the camera.
Emily Birnbaum (Courtesy Birnbaum)

Birnbaum: Yeah. So over the last two years, antitrust has become the top priority for both the small companies that want to take on Google and Google that’s facing antitrust threats in the U.S. and around the world. IA was kind of paralyzed by a lot of these internal competing pressures. The true final straw was Microsoft pulled its funding, along with a couple of other companies. There was a huge hole. They wanted to get more money, but the biggest spenders said, “No, this organization just is not valuable to us anymore.”

Adams: What kind of signal does that send about where we’re headed in terms of how the tech industry approaches lobbying in Washington? Because it seems like there’s sort of two separate paths forming here.

Birnbaum: I mean, I think this is really symbolic of the larger fragmentation happening across the tech landscape. Some of the most important tech policy issues coming up today are company versus company. But overall, we’re seeing a lot of splits happening, and it’s all sort of in flux. Because while the companies spend more than ever in D.C., they’re less effective at getting their message across, and this is part of it.

Adams: What other trade groups do you see as maybe stepping in to fill some of the space that’s going to be vacated by the Internet Association?

Birnbaum: So there are tons of tech associations in Washington. Two groups come to mind immediately that are both partisan. So one of them is NetChoice. It’s a tech association that’s sort of flamboyant, and they’re geared towards the right. And then there’s the Chamber of Progress, recently formed by a former Google executive, which represents the same kinds of companies. You know, the big tech companies, some of the gig work companies, but that group speaks mainly to the left. And I think their growing prominence says something about partisan breakdowns in Washington more broadly — even business groups have to have a partisan slant. Speaking with both of those groups over the last couple of days, it sounds like they’re going to try to approach these policy issues, speak the language of Democrats, speak the language of Republicans when it comes to tech, and then try to find a tech-friendly solution in the middle.

Adams: Right. I was just thinking with all of this fragmentation, what does it mean for how effective these companies are going to be in shaping policy?

Birnbaum: Yeah. I mean so, you know, one of the ideas of trade groups is the big guys will fund them and the smaller guys can be the more sympathetic face of them. But now we’re in a situation where Google’s speaking for itself, Amazon’s speaking for itself, and they’re not very popular on Capitol Hill. I think a lot of these companies are going to turn to their own strategies. For instance, Amazon has tapped some of the small businesses that use its platform to advocate on its behalf, or Google has been considering bringing Google users into Congress to lay out their arguments against regulation. But I think this is a real inflection point, and the smaller tech companies, if they’re able to strategize correctly, could really get their way.

Adams: For a lot of people outside of Washington and definitely outside of the tech industry, one group going away may not seem all that important, especially a lobbying group, given sort of how people think about those. Why does this matter to regular consumers?

Birnbaum: Right now, one of the biggest questions facing our country is economic concentration. Are the biggest companies too big? Do they have too much power? And tech is at the center of that question. Tech companies make up our daily lives. You know, we rely on Google, we use Amazon Prime, and the question is: Should they be able to exert that power at the detriment of consumers, of small businesses? Should we have more competition in the marketplace? This is an issue that President Joe Biden has really taken on. And so, that’s really the question at the center of all of this. You know, can the companies get their way, continue wielding the same amount of power, or are they going to face some kind of reckoning or even be broken up?

Related links: More insight from Kimberly Adams

As I mentioned, Birnbaum broke this story for Politico.

And by the way, we had the Internet Association’s K. Dane Snowden on our show a few weeks ago when we were doing our series on tech regulation. He was talking about the industry’s push for federal privacy rules.

Also, here is the official statement from the Internet Association, which says, in part: “As this chapter closes, member companies … will continue to work with stakeholders in other capacities.”

Which basically means — tech lobbying isn’t going away, even if the Internet Association is.

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