Congress proposes law to prevent Big Tech from favoring its own products

Congress proposes law to prevent Big Tech from favoring its own products

by Tech News
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In context: Recent antitrust lawsuits and investigations from various agencies in multiple countries have pushed numerous companies’ anticompetitive behavior to the forefront. So it’s not surprising that the US Congress has been pursuing several legislative measures to address issues exposed by these cases. The latest hopes to ban companies from favoring their own goods and services.

On Wednesday, a bipartisan group of US senators introduced a bill that would prohibit Big Tech firms from favoring their own products. It is one of several motions in Congress to address various antitrust concerns that have sprouted up with several tech giants, including Apple, Facebook, Google, and Amazon.

The legislation sponsored by Amy Klobuchar and Chuck Grassley looks to ban companies operating large platforms from locking their clients into using their goods and services. For example, the law would prohibit Facebook from requiring advertisers to use its Audience Network—it would have to let them use third-party ad solutions if they wish. It could also potentially apply to the use of payment platforms that is at the heart of the Epic v Apple antitrust battle.

I think small businesses in America should have a shot to compete online. That’s the bottom line of our new legislation: to make sure Big Tech companies can’t use their dominance to push out the competition.

— Amy Klobuchar (@amyklobuchar) October 20, 2021

Reuters notes that the bill also prohibits companies from tuning their search algorithms to favor their own products. This second part of the legislation seems to be directly related to the recent discovery that Amazon India has been fixing search results to funnel users to its own knock-off products versus its competitors.

Unsurprisingly, Amazon, Facebook, and Google oppose the measure, saying it could have “unintended consequences.”

“[This legislation] would harm consumers and the more than 500,000 US small and medium-sized businesses that sell in the Amazon store, and it would put at risk the more than 1 million jobs created by those businesses,” Amazon said in a statement.

Big tech companies shouldn’t be able to use the information they collect on small businesses that sell on their platforms to create copy cat products and box out competition. This hurts our economy and raises prices for YOU.

Now is the time for Congress to act.

— Amy Klobuchar (@amyklobuchar) October 19, 2021

Facebook defended itself, saying that it competes with several social media platforms, including TikTok and Twitter. It contends the bill would “dismantle” its integrated products and services in a way that would harm its customer base.

A Google spokesperson told Reuters that if the bill were to become law, companies would have a hard time offering free services such as search and maps. The company also feels that such a law would lead to those free services becoming “less safe, less private and less secure.”

Not all tech companies are against the bill. Senator Klobuchar’s office said that Spotify, Roku, Match Group, and DuckDuckGo support the legislation.

The House Judiciary Committee has already approved the bill, but it still has to be passed by both branches of Congress before being sent to President Joe Biden for his signature or veto.

Image credit: UpstateNYer (CC BY-SA 3.0)

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