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Antitrust

The Bipartisan Politics for More Google Facebook Amazon Accountability

In this post-mid-term election sea of partisanship, expect a political safe harbor for bipartisanship in the next Congress to protect consumers and level the playing field, by bringing more accountability and transparency to the Internet’s unchecked, winner-take-all, biased-brokers, of online supply and demand: Google, Facebook, and Amazon.

This is timely and relevant because conventional wisdom appears to dismiss bipartisanship in this area as a phase and not lasting to conclude that no Internet-related legislation passes next Congress.

This analysis considers the political reasons why a Republican-controlled Senate and Democrat-controlled House could cooperate and pass bipartisan legislation that brings much more accountability and transparency to the unaccountable Internet triad of Google, Facebook and Amazon.

The Reasons Efforts for More Google Facebook Amazon Accountability Will Remain Bipartisan 

First, there are evident high-level lasting concerns from both the right and left about the Internet triad’s unaccountable power.

Google Facebook & Amazon’s Efficient Vortex Traps

Summary

Why do Google, Facebook, and Amazon apparently so befuddle, overwhelm, and run circles around antitrust authorities to date?

Google, Facebook, and Amazon defy normal narrow, static antitrust market definition analysis and understanding, because what is new and most defines them in an antitrust context is their exceptional, wholistic, centripetal-force dynamic, which is vortex effects and efficiencies, i.e. an effective whirlpool dynamic that in encircles, swirls, and sucks everything near, deeper into an increasing vacuum power trap.

Simply what is different and under-appreciated with these companies is the extraordinary and unprecedented nature, purpose, and effect of the efficiencies their platforms generate and proliferate.

To date antitrust authorities myopic mistake has been to narrow their scope to a market segment and miss the big picture of the enterprise’s combinatorial nature, purpose, and effect -- as a whole, because the purposeful whole can be much different and more powerful than the random sum of its parts.

Google Facebook Amazon’s Civil Liability Immunity = A Culture of Un-Ethics?

Why is the techlash cloud following Google, Facebook, Amazon, and others around, like the cloud of dirt that followed Pigpen around in the iconic Peanuts comic strip?

One theory is advanced by Kara Swisher, a New York Times columnist and proven thought leader, who mused in her columnWho Will teach Ethics to Silicon Valley?” because Silicon Valley CEOs have evident ethics and maturity deficiencies.

Her lede was “I think we can all agree that Silicon Valley needs more adult supervision now” and asked: “Is the solution for its companies to hire a chief ethics officer?” 

Ms. Swisher is right in spotlighting that Silicon Valley, and predominantly its Internet platform leaders, need ethics teaching and more maturity.

Google+’s Market Exit Spotlights Google + Facebook Cartel Market Allocation

Google and Facebook’s cartel dominance of social media, consumer data, digital advertising, and content/news discovery represents a quintessential unlevel playing field in the information/content economy.

The Google+Facebook cartel now controls most mass online info-flows to consumers, without the competitive or public accountability controls other companies face.

However, recent news of Google+ deciding to permanently not compete with Facebook going forward raises an important question:

Is Google+ jumping out of the proverbial privacy frying pan into the Google+Facebook antitrust fire?

FTC-DOJ Signal Privacy Is a New Antitrust Risk for Google Facebook

SUMMARY:

U.S. antitrust enforcement is evidently undergoing a sea change in how it treats consumer privacy in its antitrust investigations. 

Since the early 2000s through apparently late 2017, DOJ and FTC antitrust enforcers did not consider privacy to be a “non-price factor” in antitrust enforcement.

However, since 2018 the evidence catalogued below indicates that privacy now can, and will increasingly be, a factor in antitrust enforcement involving Internet multi-sided business models going forward, in determining whether a commercial practice anticompetitively harms innovation, choice, or quality.

That’s because of increasingly evident consumer “revealed preferences” for privacy; personal data’s effects on competition for markets; and the inherent “flexibility” of the antitrust consumer welfare standard to adapt to new technological, market, economic, and consumer developments. 

A big reason many investors and the marketplace have concluded that Google and Facebook face no serious antitrust risk going forward was the backward-looking, core conventional-wisdom presumption that harms to consumers’ privacy and data security were largely irrelevant because of the consumer welfare standard focus on price reduction in Internet markets where the “price” is already zero, i.e. free.  

Google Facebook Amazon’s Non-Neutral, Neutrality Nonsense Harms Competition

What is non-neutral, neutrality nonsense?

When the world’s dominant biased-broker Internet platforms, Google, Facebook, and Amazon, are the biggest funders of network neutrality and utility common carrier regulation for competitive ISPs, and their dominant, increasingly utility-like, network-effect-driven, business models, regularly treat other businesses non-neutrally while misrepresenting to the public that they are neutral platforms.

Google, Facebook, and Amazon demand maximal ISP regulation for network neutrality, transparency, and accountability, when ISPs operate their networks neutrally, transparently and accountably without it, but Google, Facebook, and Amazon fiercely oppose operating their much larger, global, encrypted-networks, with network neutrality, transparency, or accountability.

The “techlash” has exposed Google, Facebook, and Amazon, as the most dominant companies in the U.S. warranting antitrust scrutiny, as inherently biased-broker non-neutral networks, and as privileged platforms who abuse Section 230 immunity from civil liability to operate non-neutral, non-transparent, unaccountable, and anticompetitive Internet platforms.  

This is the non-neutral, neutrality nonsense of Google, Facebook, and Amazon – i.e. their asymmetric regulatory recipe for a winner-take-all, unlevel playing field.

How EU Amazon Antitrust Probe Spotlights Amazon as an Unlevel Playing Field

Consider the ways that the EU’s announced antitrust probe of Amazon is a game changer in spotlighting how Amazon Marketplace’s conflicted-expanse is a de facto unlevel playing field.

First, the ongoing probe will spotlight that Jeff Bezos, Amazon, investors, and U.S. antitrust authorities can no longer dismiss that Amazon faces antitrust risk.

The EU’s competition commissioner, Margrethe Vestager has launched a preliminary, expert, bulls-eye antitrust probe at by far the most antitrust-vulnerable part of Amazon’s online market-monopsonization model – i.e. the anticompetitive Amazon Marketplace structure where Amazon first commands unchecked, most of its competitors’ most sensitive business confidential information/data and metadata; and second non-transparently and unchecked, determines their competitors’ rank and costs to commercially access Amazon’s monopsonized online consumer demand.

Simply the EU is investigating whether Google’s unchecked dual role as an economy-wide merchant and platform make it an inherently anticompetitive biased-broker?

The Unlevel Playing Field of Asymmetric Competition Expectations

A core question for the FTC to answer in its hearings on “Competition and Consumer Protection in the 21st Century,” is what are the FTC’s underlying competition expectations?

Why have telecom, cable, and wireless network communications’ convergence with information technology turned out to be pro-competitive, but the Internet platforms’ reverse convergence of information technology with communications networks turned out to be anti-competitive, i.e. naturally winner-take-all?

Asymmetric governmental competitive expectations are why.

Congress’ stated purpose in passing the 1996 Telecommunications Act was “to promote competition and reduce regulation…” [bold added] and Congress’ antitrust savings clause clearly did not change the applicability of antitrust laws to communications networks.

In stark contrast, as an unregulated information service, information technology companies’ networks operated outside of the FCC’s pro-competition mandate, despite the well-known monopolistic behavior of consumer/business software provider Microsoft at that time.

Google Facebook & Amazon’s Anticompetitive Nontransparent Exchange of Ideas

There can’t be a “free exchange of ideas” without transparent competition for the exchange of ideas.

This is a timely point for three reasons.

First, the DOJ announced: “The Attorney General has convened a meeting with a number of state attorneys general this month to discuss a growing concern that these companies [Google Facebook Twitter] may be hurting competition and intentionally stifling the free exchange of ideas on their platforms." [Bold added.] This “competition” concern ultimately falls in the lap of the DOJ’s Antitrust Division and State Attorneys General.

What’s the FTC Hearing before their Hearings on the Unlevel Playing Field?

Evidently antitrust non-enforcement can have big consequences.

It can cause big un-ignorable problems that get the attention of the President, all of Congress, and both political parties. That rare feat of collective attention-grabbing can point them collectively in the same rough direction – back to antitrust authorities that could have, or should have, prevented many of the messy Internet platform unaccountability problems that they collectively are wrestling with resolving now.   

Before the FTC has its first retrospective review hearing on its own institutional performance this fall, it has been getting an implicit earful from its governmental superiors that it actions and inactions have apparently created broad and serious negative consequences for competition.

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Q&A One Pager Debunking Net Neutrality Myths