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In a move that could potentially disrupt the largest companies in Silicon Valley, the US Department of Justice announced that its antitrust division had opened a review of whether and how market-leading online platforms had reached the power of the market.
The Department of Justice, in its announcement Tuesday, did not identify the companies it is examining in the context of the investigation. Facebook, Amazon, Google and Apple are the largest and most powerful companies in the industry.
This is the latest political coup against the technology industry, which has drawn criticism across the ideological spectrum.
"Without the discipline of real market competition, digital platforms may not respond to consumer demands," said Deputy Attorney General Makan Delrahim of the Antitrust Division of the Ministry of Justice. in a statement. "The department's antitrust review will examine these important issues."
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Delrahim led the ultimately unsuccessful DOJ trial to block the AT & T-Time Warner merger.
In recent months, the media has announced that the DOJ and the Federal Trade Commission are considering launching antitrust probes in major technology companies.
The Justice Ministry said Tuesday that its investigation was prompted by "widespread concerns" from consumers and businesses about "research, social media, and some online retail services." According to the Department of Justice, the investigation will seek to determine whether companies are "engaging in practices that have reduced competition, smothered innovation or harmed consumers."
The DOJ antitrust division is seeking information from the public, including industry participants "who have direct knowledge of online platform competition". The agency said that if its investigation determines that companies have broken the law, it will proceed "appropriately redress."
The shares of Alphabet (parent company of Google), Amazon, Apple and Facebook gave way after normal business hours after the Wall Street Journal announced the GM's investigation before the official announcement.
According to Wedbush Securities badyst Dan Ives, the Justice Department investigation is unlikely to lead to the dissolution of any of the companies. However, the survey introduces a short-term uncertainty for the sector.
"Ultimately, we think it's more noise than the beginning of broader structural changes in the technological food chain, and this will likely result in changes in the business model and potential fines imposed by the FJ / FJ. in the worst case scenario rather than by the forced split of the underlying business, "Ives wrote in a note to investors.
Earlier this month, the FTC would have voted in favor of a $ 5 billion fine for violating confidentiality rules. The agency was seeking to find out if the social media giant had breached the terms of its 2011 deal with the FTC after data from Facebook users had been obtained by the now-defunct Cambridge Analytica consulting firm. .
Beltway's critical reaction against tech giants included calls from Democratic presidential candidates Elizabeth Warren and Bernie Sanders to dismantle huge tech companies, while Republicans, including Donald Trump, focused on one party taken policy in the way that platforms such as Facebook and Google moderate and rank the content.
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