Opening Moves

Issue 49

12.14.20 - The rise of America’s tech giants has posed a unique challenge to regulators. The sheer speed in which today's tech giants went from mere “Dot-Com start-ups” in dorm rooms and garages to the top of the Fortune 500 is unprecedented. On top of this, Congress is facing a significant problem; they are just beginning to understand the businesses in which they’re attempting to regulate.

In October the Department of Justice filed a lawsuit against Alphabet, the parent company of Google, making it the first shot fired in what will be a long multi-front war against Big Tech by the Federal Government. Today, the state of California has filed to join that lawsuit. The Justice Department’s lawsuit is alleging that Google has violated antitrust laws through their partnerships with Apple and Samsung to be the default search engine on their devices.

The suit also alleges that Alphabet pressured other device makers that used its operating system, Android, to preload its search engine and its other applications on devices powered by its software.

On Wednesday, the Federal Trade Commission and a bipartisan group of 46 states filed broad antitrust lawsuits against Facebook. The FTC lawsuit is alleging that Facebook acquired what the agency has deemed as “competitors” to prevent them from becoming future threats and demonstrated “anticompetitive behavior”. They also highlighted Facebook's conduct toward other potential competitors.

The lawsuits also cited further evidence of Facebook’s monopolistic behavior and attitudes through its rules on how third-party apps could or couldn’t leverage Facebook’s platform and userbase. The FTC released a statement saying these measures “have served to hinder, suppress, and deter the emergence of promising competitive threats”. Read More

Source: Brookfield Brief