Google, Facebook and Amazon are facing tough questions about potential monopolies

In the middle of a congressional antitrust hearing Tuesday afternoon, Colorado representative Joe Neguse asked a Facebook representative if his company was a monopoly.

"No, member of Congress, this is not the case," responded quickly Matt Perault, responsible for the development of Facebook's global politics.

Neguse, a Democrat, then proceeded to list the world's largest social media companies, by active users. There was Facebook at No. 1, then WhatsApp at No. 3 and Facebook Messenger at No. 4. Instagram was No. 6. The four belong to Facebook.

"When a company has four of the six largest entities, measured by active users, in the world of this industry, we have a word for it," said Congressman, "and it's a monopoly, or at least a monopoly power ".

This exchange, at a hearing of the judiciary of the House, could give a clue to the American tech giants about how they will be perceived in Washington, DC, as follows: Congress and regulators start to see again competitive practices and acquisitions of Facebook, Google, Amazon and Apple. But, with the government just starting to investigate these companies, there is still no clear sign that this work will result in any major changes, such as Facebook's dissolution of Instagram and WhatsApp, or much more stringent regulation for master these technologies. .

The hearing was held as part of a close examination of the tech giants, the Federal Trade Commission, examining competition in the sector, including past mergers and acquisitions. potentially anti-competitive practices. State attorneys general are also preparing to investigate major technologies. Senator Elizabeth Warren, Democratic presidential candidate, calls for the dissolution of Apple, Amazon, Google and Facebook, arguing that they have become too powerful.

The audience included representatives from Google, Amazon and Apple, although Apple received the fewest questions. This may be because the company is not perceived as a monopoly threat or because its representative was lucky Tuesday. Apple has been confronted with questions about its App Store, fearing that it favors its own services compared to competing applications.

The four representatives stated that they face intense competition in their industries and that their customers have many choices in competing services. However, in some cases, these allegations of competition referred to much smaller competitors, such as Yelp, Travelocity and Snapchat. They also highlighted their efforts to invest in the US economy and job creation in the United States.

While members of Congress attending the hearing seemed particularly concerned about the considerable power of these companies, Congressman Jim Sensenbrenner, a Republican from Wisconsin, warned his colleagues. He called on members of the judiciary to review the actions of these companies, not just their size, and warned that their break-up could hurt small businesses and not solve ongoing problems, such as protection issues. private life.

"It's not because a company is big that it's bad," he said, adding that "antitrust laws do not exist to punish successes." .

Nate Sutton, Amazon's Assistant General Counsel for Competition, has been confronted with a series of questions about how his company could stifle online retail competition and hurt smaller sellers on its site. Sutton, a former lawyer in the antitrust division of the Department of Justice, retorted that his company could identify some of the most popular products on his site and copy them.

"We use the data to serve our customers," said Mr. Sutton, repeatedly reminding him that he was responding under oath. "We do not use data from individual sellers to compete directly with them."

Google has also been questioned about claims that it will keep more traffic on its site and direct it to its own services rather than to its competitors. Representative David Cicilline, a Democrat from Rhode Island, claimed that if Google's search is "rigged" in favor of Google, "then the Internet, as we know it, ceases to be a driving force." economic opportunities ".

Google's Adam Cohen said his company sent much of its traffic to competitors.

Like Néguse, the representative of Georgia, Hank Johnson, seemed particularly concerned about the market power of Facebook.

"Each of you occupies a unique and dominant position," he said, "but Facebook remains the only one in terms of social media."

"Dream to be bought, not to build something of their own"

The tech giants were criticized Tuesday afternoon at the second meeting of the jury. Professors and antitrust experts attended the hearing before Congress.

Timothy Wu, a law professor at Columbia Law School, said the consolidation of technology companies was threatening the US position as a pioneer of new industries.

"I'm afraid … we will not become a country where inventors and entrepreneurs dream of being bought, not of building something of their own," Wu said. The acquisition of Instagram by Facebook in 2012, saying that this showed the power to repurchase threats to eliminate competition, as well as the "willingness of the government" to accept it.

Stacy Mitchell of the Institute for Local Self-Reliance agrees, saying the decline of independent companies has resulted in a contraction of trade by some tech giants.

Mitchell said the rise of Amazon had hurt American entrepreneurship, local economies, innovation and competition. The Amazon distribution center's costs have doubled, local businesses are disappearing and producers are struggling to invest in new products and start businesses at unprecedented levels, she told the congressional audience. the Amazonian labor strike this week during Amazon Prime Day also showed how work environments have become "increasingly farmer" because of the lack of competing employers, she said.

Fiona Scott Morton, professor of economics at Yale, explains that digital platforms pose a significant barrier to entry into the market. And even if existing companies spend money on R & D, this does not reach the same level of innovation as many competitors in the market.

Carl Szabo, vice president and general counsel of the trade badociation NetChoice, was on the other side of the fence. He explained that large platforms help small retailers. He said this access was open by the Etsy, YouTube, eBay and Facebook markets.

"The competition is strong," he told the audience, claiming that this was demonstrated when Google took over the dominance of research at Yahoo, when Facebook had surpbaded MySpace in social networks and how TikTok was doing competition to Facebook – "and all this in the last few years."

Morgan Reed, executive director of the App Association, also said that innovation and competition "occur everywhere."

"The application economy is booming," he said, adding that it was worth $ 1.3 trillion today and had created 5.7 million jobs in the USA.

Morton recommended better enforcement of the antitrust law to prevent big companies from buying their competitors. She also suggested setting up a digital standard to remove barriers to entry by setting open standards for data portability and micropayments, as well as regulations allowing consumers to control their own data. data.

While Wu recommended more antitrust measures, including retroactive merger review, Maureen Ohlhausen, an antitrust practitioner and partner at Baker Botts, said "trying to unravel the eggs" long after the merger, or even break the tech giants, carries a serious risk of harm to consumers.

First publication at 15:56 PT on 16 July.
Updated at 16:51 PT: add details on the second panel.