Amazon, Apple, Facebook and Google engaged in anticompetitive, monopoly-style tactics to evolve into four of the world’s most powerful corporate behemoths, according to congressional investigators, who called in a wide-ranging report released on Tuesday for sweeping changes to federal laws so that government regulators can bring Silicon Valley back in check.
The roughly 450-page report, capping a 15-month investigation by the House’s top antitrust committee, found the four tech giants relied on dubious, harmful means to solidify their dominance in search, smartphones, social networking and shopping — and in the process evaded the very federal regulators whose primary task it is to ensure that companies do not grow into such corporate titans.
Congressional investigators faulted Facebook for gobbling up potential competitors with impunity, and they concluded Google improperly had scraped rivals’ websites and forced its technology on others to reach its pole position in search and advertising. Lawmakers’ report labeled both of those companies monopolies while faulting the federal government for failing to crack down on them sooner.AD
Amazon and Apple, meanwhile, exerted “monopoly power” to protect and grow their own corporate footprints. As operators of two major online marketplaces — a world-leading shopping site for Amazon, and a powerful App Store for Apple — the two tech giants for years set rules that essentially put smaller, competing sellers and software developers at a disadvantage, the report found.
The House stopped short of calling for any of those four companies’ to be broken up. Instead, investigators proposed the most sweeping overhaul of U.S. antitrust law in decades, a series of legislative proposals that could empower the government to battle bigness in the industry and prevent future problematic mergers. Any such reforms would require approval from Congress — and affect not only Silicon Valley but the entire economy, essentially turning the House’s probe into a broader assault against corporate consolidation.
The findings also could carry considerable legal weight, lending fresh evidence to state and federal officials as they actively investigate Apple, Amazon, Facebook and Google for potential violations of antitrust rules. The Justice Department is expected to file an antitrust lawsuit against Google expected in a matter of days, as state attorneys general mount their own, nearly finished probe of the search-and-advertising giant.AD
“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,” the House panel concluded in its report. “Although these firms have delivered clear benefits to society, the dominance of Amazon, Apple, Facebook, and Google has come at a price.”
“These firms typically run the marketplace while also competing in it,” investigators continue, enabling tech giants “to write one set of rules for others, while they play by another, or to engage in a form of their own private quasi regulation that is unaccountable to anyone but themselves.”
Apple, Facebook and Google did not immediately respond to requests for comment. Amazon responded with a blistering, unsigned blog post, calling House investigators’ slew of proposed antitrust reforms “flawed” and “fringe” in nature and scope.AD
“All large organizations attract the attention of regulators, and we welcome that scrutiny. But large companies are not dominant by definition, and the presumption that success can only be the result of anti-competitive behavior is simply wrong,” Amazon said.
Amazon CEO Jeff Bezos owns the Washington Post.
This is a developing story. Please check back for updates.