By Jon Swartz
The virtual clashes capped more than a year of hearings and investigations by Congress into the business practices of the Big Four and whether they violate antitrust laws. The committee and its staff accumulated 1.3 million documents; its conclusions, following today’s hearing, are expected to be issued in a report later this year.
Read more: Congress has a million-plus documents from Big Tech antitrust investigation, and are ready to grill big-name CEOs
What they recommend will go a long way in influencing current probes by the Justice Department and Federal Trade Commission, as well as state attorneys generals — all of whom are looking into how Apple, Facebook, Alphabet, and Amazon leverage their vast resources to accumulate significant market share in multiple industries. The companies are also the subject of investigations by European regulators, who have shown more of a willingness to fine them.
The companies boast sizable market share an influence in e-commerce (Amazon, Google), streaming (Amazon, Apple), advertising (Google, Facebook, Amazon), search (Google), social media (Facebook and its properties Instagram and WhatsApp), cloud computing (Amazon, Google), and fledgling areas such as artificial intelligence and machine learning.
“Your platform is so big, you can’t contain false and harmful content,” Cicilline told Zuckerberg at one point, driving home the immensity of its digital properties.
Google, which is being investigated by the Justice Department and state attorneys general for its ad business, is likely to face the first action from the federal government. During an exchange in Wednesday’s hearing, Rep. Pramila Jayapal, D-Wash., asserted that Google controls both the buy and sell side of the ad market.
Microsoft Corp. /zigman2/quotes/207732364/composite MSFT +0.24% , which does not play big in consumer markets, is not part of the investigations though Slack Technologies Inc. last week filed an anticompetitive claim against the software giant with the European Commission. An attempt by Republicans to add Twitter Inc. /zigman2/quotes/203180645/composite TWTR +1.26% to Wednesday’s hearing was unheeded by Democrats, who control the House.
The tentacles of power of the four companies questioned have affected thousands of smaller companies and businesses that compete in some manner. Their combined market value of about $5 trillion continued to rise Wednesday. Shares of all four were up at least 1% on Wednesday.
“We want to see fairness at the end of the day,” said Ben Volach, co-founder and co-CEO of Blix, an email app developer that claims it has data showing Apple suppressed App Store rankings of products that compete with Apple’s own apps. Blix, which sued Apple in October alleging patent infringement and antitrust violations, worked with Cicilline’s staff to come up with questions for Cook. “Apple not only creates the devices and the OS, but the main operations on the phone, and they extend this into even more areas,” Volach told MarketWatch.
“A handful of technology platform giants have come to exert far too much power over consumer commerce and communications,” George Slover, senior policy counsel at Consumer Reports, said in a statement. “This extreme level of market concentration harms consumers, depriving people of competitive choices, fair and transparent prices, and a meaningful diversity of views.”
All four tech CEOs opened with statements that ranged from the personal (Bezos) and prowess of and popularity of products (Apple’s Tim Cook) to an eight-part opus that read like a grade-school essay (Zuckerberg) and personal success stories of customers (Pichai).
See also: Here’s what the CEOs of Apple, Amazon, Facebook and Alphabet will say at Wednesday’s antitrust hearing
What impact, if any, the hearings have on shares of the companies — all four report quarterly results Thursday — is unclear. So far, their stocks have flourished during COVID-19 with Amazon a particular beneficiary.
Wedbush Securities analyst Dan Ives cautioned in a note Wednesday that “anti-trust storm clouds appear to be building in the Beltway against Big Tech looking ahead into the rest of 2020.”
“Ultimately, we think a legislative fix is the only one that creates a potential for limitations on these companies’ ability to conduct business, whether that takes the form of higher taxes or new rules regarding market concentration,” Ives wrote. “Absent a legislative fix, we don’t see meaningful change in regulation, although future acquisitions will most certainly be scrutinized and more difficult to close (see Alphabet’s proposed acquisition of FitBit , still unsettled after 9 months).”
See also: Big Tech’s big test arrives in the busiest week of earnings season