The fight between technology and FTC chief Lina Khan over antitrust supervision will be a mess

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For several years, Congress and regulators have been warning that they may try to break up large technology companies in the future. In the past week, this threat has become more real.

On June 11, Congress proposed a Five sets of antitrust laws The bipartisan support that targets the tech giants Amazon, Apple, Facebook and Google is significant, which may undermine their core business. On June 15, the White House unexpectedly appointed a tech giant as its nemesis Lina Khan is not only a member of the Federal Trade Commission (FTC), but also the chairman A powerful federal agency that enforces antitrust laws.

“If I run a large technology company, my pulse today will be much faster than 24 hours ago,” Bill Kovacic, who led the FTC during Bush’s presidency, is second after the news that Khan will be chairman. Tian told Recode the Federal Trade Commission.

So now, although it is not clear what the Khan or the antitrust bill can achieve, supporters of large technology companies are strengthening their defenses. One of the main antitrust criticisms opposed by technology industry groups and lobbyists is that large technology companies are too large and need to be controlled.

These technology-supporting groups believe that the current proposed legislation is a serious over-expansion that may harm the U.S. economy and make it more difficult for ordinary Americans to use popular technologies that they are accustomed to obtaining for free, such as email and social media. Supporters of these technology industries are trying to convince lawmakers that regulating large technology companies will have unintended consequences and harm consumers. They specifically targeted Khan, who publicly advocated breaking up technology companies such as Amazon.

“These proposals cannot withstand public scrutiny,” said Adam Kovacevich, the chief executive of Chamber of Progress, a center-left technology advocacy organization that is backed by Amazon, Facebook, Google, and other technology companies. “In the final analysis, what people want from Congress is to solve the problems that have been broken, not to break the things they already think are working.”

Why industry leaders are afraid of Lina Khan

Khan’s appointment to the FTC—approved by a vote of 62-28 with bipartisan support—is regarded as one of the most serious regulatory threats facing technology companies to date.

This is because the FTC has extensive powers to prevent large technology companies from acquiring their competitors, as well as small upstarts who may one day become major competitors. This means that the future FTC may prevent Facebook from buying the next Instagram. The FTC can go further by forcing technology companies to retroactively separate acquisitions and existing business lines, such as preventing Amazon from selling Echo devices and Kindles on its website (although such efforts are difficult to achieve).

Khan published an article in 2016 Academic papers This laid a legal foundation for breaking up Amazon. Since then, she has been called the “leader” The “fashionable antitrust” movement among young scholars Those who wish to expand the existing anti-monopoly law to better solve problems such as corporate concentration and income inequality. Khan also received support from politicians in various ideological fields, including progressive Senator Elizabeth Warren and Republican Senator Josh Hawley.

The argument in favor of separating certain business lines of large technology companies is that some large technology companies are alleged to have compromised consumer choices and competitors by operating their own markets and prioritizing their own products over those of competitors.An example that emerged during an antitrust investigation was a report showing Amazon employees use data about third-party sellers Launched Amazon branded competitive products on the Amazon market.

Under Khan’s leadership, the FTC can begin to actively pursue such cases. Therefore, some supporters of the technology industry have targeted Khan’s past academic works, which have been criticizing the economic strength of Amazon and other large technology companies.

“Lina Khan’s chairmanship will generate prejudice and prejudice in technology business decisions,” said Carl Szabo, vice president and general counsel of NetChoice. NetChoice is an industry organization whose funders include Google, Facebook, and Amazon. Recode.

Szabo said that he believes that because of her academic work, Khan should avoid any cases involving technology.He pointed out that as early as 1966, a company named U.S. cyanamide sued the U.S. Federal Trade Commission, Forcing the then chairman of the committee to avoid the case because of his prejudice against the company.Sweat I dismissed this idea before She should fully avoid all technical cases and said that if there is a problem, she will consult the FTC Ethics Committee Regarding the challenge of specific casesThe FTC declined to comment on criticisms of Khan’s past work.

At this point, there is no sign that any large technology company will consider filing a lawsuit based on Khan’s bias, but the fact that technology industry group leaders are proposing this idea shows that they are shocked by her powerful new role.

Even for experts, regulatory techniques are complex

Big Tech’s challenges are not limited to Khan and FTC. Congress has introduced five broad-influencing legislation that may harm these technology giants. Advocates supporting large technology industries are on the defensive, calling on legislators to explain why they should not support this wave of bills.

“Efforts are being made to educate lawmakers on the unexpected and harmful consequences of the bill we see in the House of Representatives,” Sabo said.

Progress Association Wrote a letter to Congressman David Cicilline (D-RI), he led the antitrust legislation of large technology companies as the chairman of the powerful House Antitrust Subcommittee. In the letter, the organization listed the worst-case scenarios that consumers may face if the legislation is passed, including future Alexa users may not be able to order from Amazon, YouTube may have to let users upload pornographic content, and Apple’s iPhone may be sold. There are no pre-installed applications.

Bloomberg Seems to confirm At least one of them was when it was reported on Wednesday that Cicilline stated that his bill would prevent Apple from installing its own apps on the iPhone, because doing so would put competing app makers at a disadvantage. Technical analyst, Lobbyists, and commentator Instantly criticism This mocks the idea of ​​consumers buying the iPhone, which is essentially a blank sheet of paper, and there is no application like the Apple App Store to implement basic smartphone functions.

“It is one thing to say that you oppose discrimination. It is another thing to say that you oppose the iMessage and FaceTime preinstalled on the iPhone,” said Kovacevich of Chamber of Progress.

Cicillin The spokesperson later wrote on Twitter Members of Congress have been wrongly quoted that the bill will not prevent Apple from pre-installing apps, but will force the company to let people uninstall or switch Apple’s default apps.Currently, on newer iPhones, you can delete Some-but not all-Apple installed apps. You can already switch the default application for your device Email and web browser On newer iPhones, although not on older iPhones.

Repeated discussions on the details of the Cicilline Act show how chaotic the battle between supporters of large technology companies and politicians trying to regulate the industry is becoming-especially when it involves unintended consequences for the regulation of mass consumers. Subtle discussions on technologies like the iPhone.

It is undeniable that the existing anti-monopoly law was not designed for the Internet age.But there is also a Public debates between members of parliament Regarding whether regulation will stifle innovation. As we all know, some politicians in Washington are slow to understand basic knowledge, which is of no avail. How a large technology company works, As evidenced by public hearings in the past few years. Even for experts, the consequences of adjusting widely used consumer technologies are difficult to predict.

On the other hand, politicians who oversee technology like Cicillin believe that inaction may stifle innovation in different ways—by preventing the rise of upstarts who may challenge the status quo of the most powerful major technology companies.

This is a tactical ideological debate. Each party has appealed to legislators, especially Republican legislators, that the Democrats may need to pass these bills.

Kovacevich of the Progressive Chamber of Commerce said his team will launch an advertising campaign specifically targeted at members of Congress, trying to persuade them not to support the technology antitrust bill. This is just another step in a protracted battle.

“About this question [Big Tech] The lobbying team is-can you stop it? Or did your opponent bypass you? “Former Federal Trade Commission leader Kovacic said. “This is a contest of ideas. ”



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