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US lawmakers are targeting big tech — and it’s going to affect us all

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Five antitrust laws proposed in the United States aim to aggressively rein in the market power of “big tech” companies and change the way they do business.

The set of bills, introduced on June 11, targets the enormous economic power wielded by the likes of Amazon, Apple, Facebook, and Google (owned by parent company Alphabet).

The expansive proposals range from breaking up different businesses run by big tech, to more effectively preventing mergers known as “killer acquisitions”, in which big tech companies buy up rivals to stamp out threats to their market power.

The proposals would represent a massive change to US antitrust laws. US courts applying these laws currently tend to favor the growth of large companies and regard their economic power as a sign of superior economic efficiency.

Each of the bills has some support from both Democrats and Republicans. Remarkably, the proposals have survived to this stage, in the face of record lobbying by big tech companies in Washington.

Even if only some of the proposals are passed as law, they will likely have significant consequences for the way big tech does business globally.

Who is targeted as “big tech” and why?

The five bills — collectively called “A Stronger Online Economy: Opportunity, Innovation, and Choice” — would apply to any “covered platform” which:

  • has at least 50 million active monthly users in the US
  • has an owner with minimum net annual sales or market capitalization of US$600 billion
  • and is a critical trading partner for the supply of any product or service on or directly related to the platform.

This would capture at least Amazon, Apple, Facebook, and Google. The proposals are the result of a 16-month investigation into these companies by the US House Judiciary Subcommittee on Antitrust.

The investigation famously saw the chief executives of Apple, Amazon, Facebook, and Google each testify before members of the committee. This culminated in a 450-page report published by the majority Democrats in October last year.

The report slammed various strategies used by the companies as being monopolistic and harmful to innovation, competition, and consumers. It said:

“To put it simply, companies that once were scrappy, underdog startups that challenged the status quo have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons.”