Advantages and Disadvantages of Federal Digital Antitrust Law

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In 2020, the United States House of Representatives Antitrust Subcommittee published a report on anti-competitive behavior by Apple, Amazon, Facebook and Google.

Investigators found that these companies were suppressing competition. In response, ILegislators introduced several billsincluding the “American Innovation and Choice Online Act” or AICOA.

The law would do a lot of things, including banning big tech companies like Google from “personal preference”.

According to Brian Albrecht, chief economist at the International Center for Law and Economics, self-preference “occurs when a company gives an advantage to one of its own products. For example, when you search for “restaurants in proximity” on Google and you see a Google Maps box at the top, that’s self-preference.

Under AICOA, this behavior would likely become illegal and subject companies like Google to massive fines.

Several New York State legislators, including Deputy Senate Majority Leader Mike Gianaris are urging US Senate Majority Leader Chuck Schumer to bring the bill to a vote.

Without surprise, big tech companies have invested in lobbying against the AICOA.

Critics of the bill, such as Dr. Cameron Miller, an assistant professor at the Martin J. Whitman School of Management at Syracuse University, say it would hamper innovation.

“The premise of the bill is that big will equal bad, without actually showing what’s hurt,” Miller said. Capital tonight. “So if you’re a seller on Amazon, or a consumer using Amazon, you benefit from having a lot of parties on the other side.”

When it was pointed out that companies that have achieved gatekeeper status like Amazon are or are approaching monopolies, and that monopolies have historically nullified innovation (think Standard Oil), Miller was not disagree that platforms have a monopoly on a particular area. market.

“[Amazon] isn’t the only game in town,” he said. “Do you feel like you’re paying higher prices? »

While advocates want Schumer to get AICOA to vote before the August recess (which begins Aug. 6), big tech pushes back hard with a few arguments that might resonate with voters.

First, the bill could make Amazon Prime illegal because it prioritizes the shipping of specific products, including Amazon-branded products. Although the exact number of Prime members in the United States is not known, it is estimated that approximately 60% of the adult population has used the product.

“That’s exactly one of the provisions that AICOA would eliminate,” Miller said of Amazon Prime.

Another argument against the AICOA comes from academics who believe the bill “would hinder content moderation practices used to remove hate speech and combat misinformation online.”

But supporters of the bill, including YELP, which is a Google competitor, claim it would address some of the anti-competitive behavior raised by the published House subcommittee report and perhaps spark the kind of innovation that John Oliver discussed a recent program.

Another of Miller’s arguments against the bill is that the Federal Trade Commission actively regulates big tech, so the bill is redundant.

News released on Wednesday underlines how enormous this work continues to be.

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