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How US v. Google Antitrust Case Changes Internet Platform Antitrust Outlook

The impending public filing of the expected DOJ antitrust case against Google means big change is afoot for U.S. antitrust enforcement for Internet platforms.

As we look ahead, it’s important to not miss the forest for the trees.

The Senate is having an antitrust hearing on Google. The House is soon releasing a report on Big Tech antitrust. And the DOJ and states are expected to file an antitrust lawsuit against Google.

Some background on my insights and predictions below.

Thirteen years ago, I testified before the Senate Judiciary Antitrust Subcommittee in opposition to the proposed Google-DoubleClick acquisition. I accurately warned of “the stakes of lax antitrust enforcement…” and “missing the forest for the trees,” because the merger obviously “would create extreme market concentration horizontally and vertically, and also tip the online advertising market to a bottleneck.” Since then, I have copiously chronicled Google’s antitrust issues on Googleopoly.net.   

America’s Internet Reset Opportunity for a Responsible, Prosperous Internet

Please don’t miss my Daily Caller Op-Ed (PDF here) on America’s Internet Reset Opportunity for a Responsible, Prosperous Internet.

It explains how America can and must do much better than a Wild West, Winner-Take-All, Internet law.

And it spotlights a bipartisan, popular Internet reset opportunity for Congress to restore a legal duty of care online to revitalize America’s civil society, competitive commerce, and productive prosperity.

 

How Section 230 Is Anticompetitive

Our polarized Internet world has generated at least one area of extraordinary bipartisan consensus: 77 percent of Americans agree Google, Facebook, and Amazon have too much power according to a Gallup survey.  

The near unanimous participation of Federal, State and Congressional antitrust authorities in probing  Google, Facebook, and Amazon, indicates extraordinary concern that their unchecked market power threatens competition for the consumer market.

Both political parties agree that Section 230 of the Communications Decency Act, which grants Internet platforms with immunity from liability for good faith moderation of online content, in practice provides Internet platforms unaccountable power that warrants reform.

Section 230’s intermediary impunity loophole provides these dominant consumer gatekeepers with anticompetitive advantages that facilitate the monopolization of access to consumer demand online, thus undermining competition for U.S. consumer spending that comprises 68% of U.S. GDP.

These gatekeepers, which do their best to avoid competing directly with each other, dominate competitive access to the online U.S. consumer market, leaving most potential competitors dependent on them to broadly reach online consumer demand.

How could this happen?

Coronavirus Is No Cure for Techlash

Big Tech tales that the Coronavirus Crisis somehow will mitigate their Techlash problem, totally miss the mark.

They miss that the crisis is not good and not about tech. They miss that to whom much is given, much is expected.

They miss how many other industries and companies have contributed and sacrificed during this crisis without expecting something in return.

Spontaneously this past week, a tech op-ed chorus broke out singing a new tune and tale, that the Coronavirus Crisis could benefit Big Tech and save it from much of the Techlash.

Consider: Coronavirus gives Big Tech an opportunity to shine – Axios 3-18-20; Has the coronavirus killed the Techlash? Wired 3-20-20; Big Tech has the cash to expand after crisis, Regulatory threat also likely to recede for now, FT 3-20-20; and What Techlash? Virus Could Remake Industry Giants Image, The Information 3-23-20.  

Like some catchy new tunes lyrics, these don’t make sense.

Why is the Coronavirus Crisis no cure for the Techlash?

First, Americans strong bipartisan views undergird the Techlash in the U.S.

Consider a recent Gallup poll of Americans published 3-11-20.

Antitrust Pollyannaism: Google Facebook Amazon = New Entrants Not Incumbents

Are Google, Facebook, and Amazon, pro-competitive Internet “new entrants” or anti-competitive enduring monopoly Internet platform incumbents?

Apparently, that critical distinction depends less on evidence, and more on one’s antitrust predilections and prosecutorial presumptions – i.e. does one view the Internet competition glass half-empty (pessimistic) or half-full (optimistic).  

Recent evidence from the Trump DOJ Antitrust Division suggests it’s in the Internet competition optimist camp almost to the point of Internet competition Pollyannaism, despite the evident Internet platform antitrust enforcement drumbeat around the world, in Congress, and the White House, to the contrary over the last 18 months.

Google Facebook Amazon’s Non-Neutral No-Privacy Paid-Prioritization Models

We all have been played.

One of Google, Facebook, and Amazon’s greatest innovations to date may have been deceiving the U.S. government and voters with the narrative that their core Internet business models and practices were only good, innovative, pro-consumer, and worthy of no regulation, when they knew it was untrue, while at the same time lobbying that if an ISP pursued their same Internet business models and practices, that it would be anti-innovation, anti-privacy, and worthy of maximal telephone utility regulation, including a permanent, user-subsidized, price-of-zero for Google, Facebook, and Amazon’s outsized, pure profit,  commercial downstream Internet traffic usage.

Can you say: “winner take all” industrial policy?

Can you say: “regulatory arbitrage” game?

Can you say: “unlevel playing field?”

After this year’s revelations of Google, Facebook, and Amazon’s many bad, unfair, and deceptive practices, it warrants revisiting if their past forceful policy positions that only ISPs are a risk to consumers, privacy, and competition, and only ISPs warrant utility-grade net neutrality, non-discrimination, and maximal privacy regulation, were self-serving, anticompetitive, and deceptive distractions from their own anti-privacy, discriminatory, paid-prioritization practices?

We have all been played like a fiddle.

The Bipartisan Case for Modernizing Net Neutrality & Online Privacy Policy

What is the simple key to passing bipartisan net neutrality and online privacy legislation?

Put consumer interests first with a new Federal consumer-centric law, not last like today, where technology interests come first, in technology-centric law which minimizes responsibility to safeguard consumers’ choices, privacy, and security.

The tell for whether someone supports bipartisan Internet legislation to protect consumers and level the playing field or not, is whether they are focused on what is best overall for the online consumer or focused on special treatment for one technology over another. It is that simple.

Only people vote, bleed, or care. Technologies do not.

The Bipartisan Case

The origin of the term “Internet” is “inter-networking” per Robert Khan, co-inventor of TCP/IP, the Internet protocol that essentially enables and thus defines which networks are interoperable parts of the Internet’s overall network of networks, which now effectively encompasses ISPs, Internet services, Intenet platforms, cloud providers, apps, and others.  

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.

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