Big tech isn’t the problem; it’s allowing any company to scoop up large volumes of data to make a buck. Give individuals control over their data.
The Justice Department and House Judiciary Committee announced late last month separate antitrust investigations into multiple big tech companies, and tech giants have faced criticism from politicians on both the left and the right.
What would change? Nothing.
By Robert Robb
There has been a lot of discussion, and now some action, about breaking up big tech. That’s usually a reference to Facebook, Google and Amazon. Sometimes Apple is thrown into the discussion.
It’s hard to see consumer benefits from breaking up big tech. But the exercise does point out the need for substantial reform of antitrust laws.
The real problem with big tech is privacy: scooping up large volumes of data about individuals and their social media habits, and then using that information to make a buck.
The problem is that providing that data is, as a practical matter, virtually involuntary. If you use social media, big tech tracks and records your movements. Partially opting out requires technological sophistication and patience.
Focus on privacy. That’s the problem
It doesn’t matter how big ‘big tech’ companies have grown. It’s what they’re doing with our data, columnist Robert Robb says. Brian Snyder, Arizona Republic
The solution doesn’t require breaking up big tech. And breaking up the companies wouldn’t solve the problem — it would just create more companies doing the same thing.
The answer is to create a quasi-property right to our data and our movements on social media. Forbid big tech from collecting and tracking social media activity without explicit permission. Forbid the use of any data collected without our explicit permission. And forbid big tech from making permission to collect and use data a condition of access to their social media services.
If enough people refuse permission, that might reduce the extent to which big tech offers stuff for free. But it puts the legal relationship right-side up. We should own our data and make the decisions about its use, not big tech.
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What might a breakup look like?
While the concern about the market power of big tech is bipartisan, Sen. Elizabeth Warren, D-Mass., tends to think about these things with greater specificity than the other politicos in either party.
She would treat anyone who creates a big internet market as a “platform utility.” A tech company could not both run the marketplace and sell stuff on it. And it would have to treat all those selling stuff on the platform the same.
Why forbid Amazon if it’s OK for CVS?
None of this makes any sense.
The primary big-tech offense here is supposedly Amazon selling self-branded products that compete with others on its platform. But walk into any grocery or drug store and you will find scads of self-branded product cheek-by-jowl with competitors on the shelves.
Why should Amazon be forbidden to do online what Safeway and CVS do with great abandon in physical stores?
Some sellers are more valuable to any marketplace, digital or physical, than others. Differential pricing for access based upon volume or profitability is a natural, and useful, market phenomenon. Substituting the judgment of a government regulator about what is fair or reasonable will gum up the works.
Warren would also break up the companies. For example, Facebook would have to divest Instagram and WhatsApp. But all three are free to use. How are consumers being hurt from common ownership?
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The three are different ways for people to communicate with others via social media. Whether common ownership creates synergies that benefit customers or stifles innovation isn’t something government can really determine. If the latter, it creates a market opportunity for others.
How many antitrust regulators do we need?
Warren isn’t the only one looking into big tech. Both the Department of Justice and the Federal Trade Commission have opened up inquiries. Reportedly, Justice and the FTC divvied up the task. Justice would look into Google and Apple, while the FTC would examine Facebook and Amazon. Lately, however, it appears that Justice is poaching into the territory allotted to the FTC.
Meanwhile, a posse of state attorneys general is pawing the ground, opening up inquires or threatening to do so.
This is nuts. No American business, not even big tech, should be subjected to such an array of overlapping and potentially conflicting investigations.
The federal antitrust laws should preclude the involvement of state AGs on clearly national matters such as presented by big tech. If the local dairy companies are colluding on prices, let the state AGs take them on. But we shouldn’t have 50 state antitrust regulators of large, national companies.
And we shouldn’t have two federal antitrust regulators. Federal law should give the responsibility to Justice or the FTC, not both.
Give individuals, not big tech, ownership and control of the data. But otherwise, it’s probably best to leave big tech alone.
What other people are saying:
FTC Chairman Joe Simons, Bloomberg interview: “If you have to (break up tech companies), you do it. … It’s not ideal because it’s very messy. But if you have to, you have to.”
Tom McKay, Gizmodo: “The growing backlash to tech consolidation follows a long time period in which competition and antitrust watchdogs did basically nothing to stop it — and the pendulum is only slowly swinging back in the other direction. In June, New Street Research analyst Blair Levin told the Information that ‘any concrete action and coherent thinking on these things’ is likely to take at least a year and a half to materialize, meaning the next presidential administration.”
Juan Williams, The Hill: “U.S. intelligence has confirmed that the Russians acted to damage Hillary Clinton’s campaign and help Donald Trump win the White House. Then there is the damage big tech is doing to American journalism. More Americans now get their news from Facebook than from newspapers. And local newspapers have been killed off as advertising dollars have migrated from papers to online posts. Online journalism is too often reduced to a contest of who can get the most clicks. Forget about the accuracy of the stories or the quality of the analysis. It’s all about the retweets featuring conspiracies, vulgar personal attacks, celebrities in bikinis and celebrities in feuds created by their publicists.”
What our readers are saying:
We must break up all of these companies. We live in a capitalist society where there must be free competition.
— Diane Bancroft
Most legislators and employees have yet to master a slide rule, let alone the internet.
— Norman Hopkins
Corporate fines, like the one against Facebook this summer, are generally peanuts. And they almost never have to admit guilt or fault.
— Billy Corners Burke
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