By Victor Reklaitis, MarketWatch
MarketWatch photo illustration/iStockphoto
Amazon.com Inc. spent $3.9 million on lobbying Washington in the first quarter, topping the outlays by other so-called FAANG companies and putting the e-commerce giant on track for another record year of spending in this area.
Facebook Inc. /zigman2/quotes/205064656/composite FB -1.32% spent $3.4 million on lobbying as did Alphabet Inc.’s /zigman2/quotes/205453964/composite GOOG +0.06% /zigman2/quotes/202490156/composite GOOGL -0.08% Google business , according to disclosures filed in late April.
The tech titans’ significant spending to influence lawmakers and regulators comes as the companies face increasing scrutiny over how they handle their users’ data and how they deal with misinformation and political bias, with that attention triggered by recent scandals and Big Tech’s growing power.
In Amazon’s /zigman2/quotes/210331248/composite AMZN -0.47% case, its first-quarter disclosure underscores its vast reach, with businesses that range from its Whole Foods supermarkets to its cloud-computing unit that’s trying to win a $10 billion Pentagon contract. The company’s filing said it lobbied on matters such as the Supplemental Nutrition Assistance Program (also known as food stamps), as well as on issues related to U.S. Postal Service reform, high-skilled immigration and drones.
It lobbied on minimum-wage matters, data protection, trade policy, vehicle electrification and many other subjects. The latest disclosure doesn’t mention alcohol regulation, but Amazon has that in its sights as well, with its jobs website this year listing an opening for a Washington-based alcohol lobbyist to join its “growing public policy team.” The new hire would help with the company’s work already underway related to alcohol regulations across the country.
“Amazon provides a wide range of products and services for our customers, and we’re always looking for ways to innovate on their behalf. Our Washington, D.C., team is focused on ensuring we are advocating on issues that are important to policymakers, our employees and our customers,” said an Amazon spokesperson, when asked to comment on the company’s filing.
The e-commerce giant’s lobbying efforts have been increasing as it enlarges its footprint in the Washington, D.C., area. The company, led by Jeff Bezos, who also owns The Washington Post newspaper, announced in November that it’ll put a second headquarters in Crystal City in Northern Virginia.
Amazon’s ramped-up activity in the capital region has drawn criticism, with a George Washington University law professor writing in a recent Politico column that many Founding Fathers “would have hated the idea of a megacorporation in such close proximity to Congress and the White House.” And lawmakers’ drives against Amazon have included a “STOP Bezos Act” from Vermont independent Sen. Bernie Sanders that helped spur the company to raise its minimum wage to $15 per hour.
The tech titans’ significant spending to influence Washington to kick off 2019 follows sizeable outlays last year. Google laid out $22 million , Amazon spent $14 million and Facebook spent $13 million on lobbying in 2018 , representing a record level of annual spending for each company. That’s according to data from OpenSecrets.org, a website tracking money in politics that’s run by the nonpartisan Center for Responsive Politics.
Facebook’s disclosure for 2019’s first three months showed it lobbied on matters such as internet privacy and tax policy, while Apple’s many targets included trade barriers and health records. Netflix focused on issues like broadband caps and intellectual property, and Google lobbied on a wide range of matters, from cybersecurity to H-1B visa reform.
Facebook and Google declined to comment on their filings, while Apple and Netflix didn’t respond to requests for comment.
As Facebook reported its first-quarter earnings last week, the social-media giant said it expects to pay $3 billion to $5 billion to the Federal Trade Commission as that agency looks to punish the company for violating a consent decree on user privacy. CEO Mark Zuckerberg also called for U.S. regulators to step in and give clear policies for internet data privacy and harmful content.
The FTC last year began investigating whether Facebook violated the terms of an earlier settlement when massive amounts of its user data were transferred to the firm Cambridge Analytica. While that probe appears to be ending, analysts are warning that Silicon Valley isn’t out of the woods in Washington.
“The Cambridge Analytica episode will soon be over, but we see the political risk light still illuminated for Facebook and the tech sector,” said Robert Kaminski and Christopher Eyestone of Capital Alpha Partners in a recent note. “We have low odds of passage of federal privacy legislation, but Facebook and peers should still be cautious of the FTC’s ‘Tech Task Force,’ expected data collection and use studies, and potential updated enforcement guidance resulting from the commission’s series of public hearings.”
Lawmakers have talked up the potential for a bipartisan law that would lead to better protections of personal data, but analysts say it’s unlikely because of a partisan split. Democrats don’t want federal preemption of states’ laws, while GOP politicians favor preempting a California law that’s viewed as tough. A Senate committee was due to hold a hearing on data privacy at 10 a.m. Eastern Time on Wednesday.
Facebook’s stock has gained 48% in 2018, Amazon is up 29%, and Apple is also higher by 34%. Netflix shares have tacked on 42%, while Alphabet is up 14%. Meanwhile, the S&P 500 /zigman2/quotes/210599714/realtime SPX +1.48% has advanced 18%.
This report was first published on April 29, 2019.