The state is against IT giants. The essence of claims and why it is important
The US Congress has been investigating Amazon, Apple, Google and Facebook since last year. The Antimonopoly Committee is trying to figure out whether there is abuse in the work of technology giants due to their dominant position on the market. On July 29, a meeting of the legal subcommittee on antitrust policy of the US Congress was held, to which they were invited. Apple CEO Tim Cook and Aplhabet (Google's parent company) Sundar Pichai, Facebook founders Mark Zuckerberg and Amazon Jeff Bezos answered the Congress’ questions.
The scale of the event is unprecedented. This only happened in 1998. Then the head of Microsoft Bill Gates introduced the answer before the Congress. Therefore, it will be interesting to understand the history of the issue - why the world's leading IT companies came to the attention of the state, and what consequences this may lead to.
People vs Technology
Not only the United States, but also the governments of other countries have claims against the leaders of the technology industry. Often this happens due to the protection of their citizens and businesses.
The fears of regulators are shared by citizens, who, however, do not stop using the companies’ services and products. The public opinion survey conducted in 36 countries found that approximately 74% of its respondents believe that the power of technology giants should be restricted.
Source: U.S. News Best Countries Report
In countries such as the UK, Canada, Germany, India, Thailand, Indonesia, Australia, more than 80% of those surveyed believe that large technology companies should be subject to more stringent restrictions. More loyal to the problem are Nigeria and Japan. Approximately 40% of those polled are in favor of restrictions.
Sentiments were also influenced by high-profile scandals related to privacy issues and data security breaches.
But there is another reason that can be formulated as a fear of progress. About 74% of respondents worldwide agree with the statement "Technology is replacing our jobs."
What to regulate?
The debate about what exactly should be regulated has been going on for many years. Antitrust policy issues? Content moderation? Data security and transparency?
An important event in history was the US presidential election in 2016. There were many scandals then. From problems with the manipulation of public opinion on social platforms, to accusations of foreign hackers interfering in the course of the campaign.
Some experts believe that the concerns voiced by government officials to protect the privacy of citizens and personal data are just a background behind which there is a struggle for power and influence between the state and global technology corporations, whose market capitalization exceeds the GDP of many countries.
Unusual suspects
Let us look at the complex relations between states and individual leading companies.
The Justice Department's antitrust investigation, which began last summer, has focused on Google's search and advertising business. Details until completion are not disclosed.
The company also has serious problems in the EU. Google has already paid huge fines for manipulating search and AdSense contract terms ($2.7 billion and $1.9 billion). We also had to separate Google Shopping from search and separate the Android platform from the Google services that support it financially. The case also resulted in a $5 billion fine. And these are only the largest payments, not counting several smaller claims and fines.
Not without resistance, but still Google pays large sums, but does not cease to be one of the leaders not only in its industry, but also in general one of the most expensive companies in the world.
Source: Investing.com
The US Federal Trade Commission (FTC) issued a $5 billion fine for violations of Cambridge Analytica on Facebook. The accusations were that Facebook did not make sufficient efforts to prevent actions that changed the course of the election campaign.
In addition, the FTC is also conducting an antitrust investigation into Facebook.
Amazon
In addition to the antitrust investigation, the FTC was investigating Apple and Amazon's unique arrangement with resellers, as well as how the company treats third-party marketplace sellers.
Source: Investing.com
Apple
The biggest complaint from regulators against Apple has to do with how the company manages the iOS app store. Subscription services such as Spotify allege that Apple's 30 percent commission on App Store purchases is abusive. The Supreme Court upheld the civil antitrust suit against Apple on this basis.
In addition, Apple has regular investigations and lawsuits about product defects. For example, due to low battery and FaceTime bug in iOS. But all these are rather everyday threats that do not significantly affect the company's activities.
What is next?
There is a certain curiosity in the fact that the control over the activities of high-tech companies must itself be high-tech. Otherwise, it is impossible, old tools do not cope well with this.
The desire of states to limit the power of IT giants, to create frameworks and restrictions, has serious grounds. But it is not necessary to say that they will be able to restrain the development of both technologies and companies in the sector seriously.