Will a Biden administration try to break up Big Tech?
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Recent antitrust investigations into Facebook, Google, Apple and Amazon have garnered rare bipartisan support. But there are differences of opinion when it comes to enforcement, even within the Democratic Party. Some progressives have called for breaking up tech giants, while others favor a more moderate approach. So how might President-elect Joe Biden move forward?
Many analysts expect Biden to continue the Trump administration’s recent lawsuit against Google, which accuses Google of abusing its monopoly power in search and search advertising to unfairly stifle competition. The new administration is also likely to file complaints against other big companies. I spoke with Rebecca Allensworth, a law professor at Vanderbilt University. The following is an edited transcript of our conversation.
Rebecca Allensworth: You might see a little bit of a different flavor from the Biden administration, at least in their rhetoric. If you look at the joint task force that his people and the Sanders people put together this summer, there was a lot of talk in there about competition brought to heel and restoring competition for the benefit of workers and equality and minorities and underserved communities. But the trick here is that antitrust laws aren’t really about those things. And so while you could have those interests inform your decision of what cases to pursue and inform your enforcement strategies, at the end of the day, the arguments that are going to win in court are going to be about competition and economics and about consumer welfare.
Amy Scott: Right, because the conventional thinking about antitrust is usually that the government intervenes if there will be harm to consumers. So you’re saying this is a different approach that Biden could take, but maybe with some difficulty?
Allensworth: Exactly, except that the whole point of antitrust has always been to maybe indirectly confront those other problems that you might have with large companies having too much power in terms of politics, large companies poorly treating their workers. If you go after anticompetitive conduct, you will benefit those things indirectly. I think that if Biden chose to make those arguments directly, that’s going to be a real uphill battle.
Scott: So with Congress potentially divided, what tools does the administration have to regulate Big Tech on its own, if there isn’t agreement in Congress?
Allensworth: So the antitrust laws can be enforced by private parties, that’s what you see in the Epic suit against Apple. But one of the major enforcers of the laws is the executive branch of government. And so you’ll have a lot of discretion on the part of the administration about what kinds of cases to pursue and what arguments to make. The problem, perhaps, is that the decider in those cases will ultimately be the courts. And they will be using century-plus of case law built up around these statutes in order to interpret the claims that the government is making. So to the extent that the courts are not yet ready to take these bold new moves, that will constrain what the executive can do.
Scott: Both Democrats and Republicans have supported antitrust efforts against Big Tech, but they have different bones to pick with these companies. Do you think they can find common ground on the outcome, the actual goals of legislation?
Allensworth: I think that they can find common ground on the idea that the power wielded by these tech companies is not good for America. And I think from that perspective, they should be able to find some compromises on how to restore competition in these platforms. I feel less optimistic when I take my competition hat off, which is the hat I’m most comfortable wearing, and put on a First Amendment speech hat. I think about how the two sides might come together to say, “This is or isn’t the set of rules that we should apply to speech on the internet.” That seems like a really difficult and very contentious [topic]. The two sides seem almost a whole polar opposites about that.
Related links: More insight from Amy Scott
If you want to take a deep dive into President-elect Biden’s possible approach to antitrust regulation, and a whole bunch of other issues related to technology, here’s that joint task force report Allensworth mentioned. The report, released over the summer, was meant to bridge Biden’s more moderate platform with the progressive goals of Sens. Bernie Sanders and Elizabeth Warren on issues like climate change, criminal justice reform, health care and education. One recommendation: tackling “runaway corporate concentration” and reviewing whether any mergers during the Trump administration raised consumer prices, harmed workers, increased racial inequality or reduced competition.
Allensworth also talked about a private lawsuit against Apple by Epic Games, maker of Fortnite. I recommend Molly’s interview with Nicole Carpenter from the gaming news site Polygon, laying out the details. In a nutshell, the fight is over the fees Apple charges for in-app purchases on its mobile platform.
And the United States isn’t the only country grappling with the growing power of its tech industry. The Wall Street Journal reports that China has released new draft rules for online platforms. The rules take aim at anticompetitive practices like offering different prices for the same product to different consumers, or using market power to deter sales on competing platforms. The news follows last week’s sudden move by Chinese regulators to block the $34 billion IPO of financial tech company Ant Group, an affiliate of the e-commerce giant Alibaba.
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