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There are more and more signs that the Biden administration will be tough on large technology companies when it comes to antitrust rules.
Tim Wu is a professor of law at Columbia University. Last week, the White House put him in charge of the National Economic Council. Wu has warned that putting too much power in the hands of a few very large tech companies could be dangerous. This was the subject of his 2018 book, The Curse of Bigness: Antitrust in the New Gilded Age. In it, he talks about the risks that come with the market power of companies like Alphabet (GOOG), which owns Google, Facebook (FB), and Amazon.com (AMZN).
Now, reports say that the government is almost ready to add another tech critic to its team. Politico says that the president plans to put Lina Khan, an expert on fighting monopolies, on the Federal Trade Commission. Khan is also a professor at Columbia Law School. She has worked as counsel for the House Judiciary Committee’s Subcommittee on Antitrust, Commercial, and Administrative Law, where she helped lead last year’s investigation of digital markets and helped get its final report published.
Khan could not be reached right away for comment. That report, which focused on Amazon, Apple (AAPL), Facebook, and Google, said that all four companies had abused their market power.
“These giants can pick winners and losers across our economy because they control access to markets,” the report said. “Not only do they have a lot of power, but they also take advantage of it by charging outrageous fees, making contracts that are hard to get out of, and getting valuable information from the people and businesses that depend on them.
Second, each platform keeps its market power by using its role as a gatekeeper. By controlling the infrastructure of the digital age, they have kept an eye on other businesses to find potential competitors. Then, they bought them out, copied them, or shut them down. And finally, these companies have taken advantage of their role as middlemen to make their power even stronger and grow it.
Khan has written more than once in favor of regulating Big Tech in a stricter way.
In an article she wrote for New York Magazine in 2017, she called for Amazon to be banned from selling books or any other goods below cost. She wrote, “It’s time to go back to enforcing anti-predatory-pricing laws in a way that makes the playing field the same for big chains and your local bookstore.”
Khan said in the same article that Google shouldn’t be able to steer people to its own apps. He did this by pointing out that the European Union fined Google $2.7 billion for sending people to its own shopping comparison engine instead of those run by others.
“The best way to keep competition fair and open is to make sure the big internet companies don’t have this kind of conflict of interest,” she wrote. “In American culture, the usual way to do this is to make it illegal for network monopolists to own businesses that compete with companies that rely on their network to reach the market.” She said that people should do the same thing with Google, Amazon, and “other online monopolists” as they did with railroads, banks, and utilities in the past.
Khan wrote in a 2017 note for the Yale Law Journal called “Amazon Antitrust Paradox” that the e-commerce giant had mostly avoided antitrust scrutiny. He said that the way antitrust law is usually interpreted “underestimates the risk of predatory pricing and how integration across different business lines may be anti-competitive.”
Politico said that FBI agents have been calling Khan’s friends as part of an investigation. It said that Khan’s appointment to the FTC shows that the White House is planning “a big push on regulation once its early legislative agenda is done.”
Khan, who is 32 years old, would be the youngest FTC commissioner ever if the Senate agreed to him.
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