Nearly three years ago, when the Justice Department and the Federal Trade Commission launched investigations into Big Tech’s business practices, antitrust experts and legal discussion leaders heralded a new era in enforcement and a chastisement of unbridled financial power.
But a pandemic and countless bill raises later — amid frenetic lobbying efforts by Apple Inc. AAPL,
GOOGL of Alphabet Inc.,
Google, Amazon.com Inc. AMZN,
and Facebook parent company Meta Platforms Inc. fb,
— there is still no significant US law and there won’t be a real possibility in a few years.
With midterm elections approaching in the fall and both houses of Congress poised to take an extended recess in August, the prospect of antitrust law is dwindling. Policy experts view the next three months as a “jumpball” moment with the real possibility that if bills don’t become laws by Labor Day, nothing will happen until a new government in 2025, warns a tech policy expert .
“It could take years for the stars to align again to do something impactful,” Paul Gallant, a technical policy analyst at Cowen, told MarketWatch. “The summer of 2022 has always been the do-or-die period.”
Time is running out. The prospect of heavily regulating, if not shattering, the largest tech companies — what seemed like an inevitable tectonic shift in American life last year — is limited to a secondary status on Capitol Hill.
“The world is focused on Ukraine and inflation, so tech regulation is likely to fade into the background,” Vasant Dhar, a professor at the Stern School of Business and the Center for Data Science at New York University, told MarketWatch.
“It’s getting less likely by the day,” Herbert Hovenkamp, a law professor at the University of Pennsylvania, told MarketWatch, pushing the times in the Beltway and Silicon Valley.
News events have conspired to bury antitrust law as a priority, behind the battle over Roe v. Wade, COVID aid, a Chinese competition law, immigration policies, more money for Ukraine and saving parts of the stalled Build Back Better social spending and climate legislation that $1 billion in antitrust funding for the Justice Department and the Federal Trade Commission.
Read more: Congress returns to argue over COVID aid, China competition invoice
A historically intractable Congress has stymied key legislation — especially something as complex as antitrust — beginning with a deadlock in a national digital privacy law that could have served as a building block.
The two issues on which Democrats and Republicans disagree are whether a digital privacy law should include private action rights so that individuals can sue for violations of their data rights, and whether the federal law should preempt state laws, according to Caitriona Fitzgerald, deputy director of the United Nations. Electronic Privacy Information Center.
Even bipartisan bills like Senator Amy Klobuchar’s American Innovation and Choice Online Act and Senator Richard Blumenthal and Marsha Blackburn’s Open App Markets Act have seen heavy sledding for most of the year due to conflicting political motivations: Democrats want strong anti-competition, while Republicans focus on content moderation on digital platforms, said Rebecca Allensworth, a law professor at Vanderbilt University.
Representatives of Klobuchar, D-Minn., Blumenthal, D-Conn. and Blackburn, R-Tenn. did not comment on the status of their antitrust laws.
Then there is tension within the Democratic party among moderates who believe the bills go too far, as well as reticence among the California delegation representing Silicon Valley, where Apple, Alphabet and Meta are headquartered and employ tens of thousands of people, according to Bhaskar Chakravorti. Dean of Global Business at Tufts University Fletcher School.
Senate bills have not progressed since early February. “Key power brokers, such as (Speaker of the House) Nancy Pelosi and (Senate Majority Leader) Chuck Schumer, have struggled to bring antitrust laws into their rooms,” Chakravorti told MarketWatch.
Still, some developers pushing for legislation continue to hope it can happen soon.
“The votes are there, but only if Leader Schumer calls for the vote,” said Luther Lowe, senior vice president of public policy at Yelp Inc. YELP,
told MarketWatch. “The ultimate question is whether Leader Schumer will protect New York’s startup ecosystem by scheduling that vote or accidentally help Big Tech out of time constraints.”
Big Tech eagerly awaits
Big Tech’s antitrust strategy looks set to soften, flatter and precipitate this year. Tech companies have made concessions to their companies as they ramped up their lobbying efforts in Washington.
The most glaring activity last year was lobbying spending. Amazon and Meta set records with at least $20.3 million and $20.1 million, respectively, according to data collected by OpenSecrets.org. Google spent $9 million in 2021 and Apple $6.7 million.
The activity continued through March, with Amazon and Meta spending an additional $4.8 million and $4.79 million respectively.
Read more: Amazon, Facebook continue their significant spending on lobbying in Washington during Q1
At the same time, Google and Apple have some features in their powerful app stores. Google reduced commission fees while allowing side-loading of third-party apps and payment systems in the Google Play Store; Apple has slashed fees for most of its smaller developers, though it remains resistant to side-loading and alternative payment services due to consumer privacy and security concerns.
Apple, Google, Amazon and Meta declined to comment on this report. Sources familiar with their plans and not authorized to speak publicly indicate they are taking a wait-and-see, calm approach to the US legislative process
The positions they took were against the European Digital Markets Act, an upcoming law that is likely to end Apple’s practice of blocking the installation of apps from outside its own App Store and freeing developers from high commission fees charged in are charged by Apple, Alphabet, Amazon, Meta and other major app platforms.
Read more: Apple spent decades building its walled garden. It might start to crack
In the United States, however, the antitrust front is fairly muted. Expected lawsuits by the Justice Department against Apple and Google – rumored for months and expected this spring – have not taken place. An antitrust challenge by the FTC against Amazon is also seeping through.
Adding the delays is unrest within the regulatory authorities.
Jonathan Kanter, the Justice Department’s antitrust chief, has been temporarily banned from working on the government’s monopoly investigation into Google, amid a rebuttal attempt by Google. Kanter, who has represented a number of companies, including Microsoft Corp. MSFT,
in motions against Google, is an outspoken critic of the search giant.
FTC Chair Lina Khan’s aggressive antitrust agenda had remained neutral until Wednesday, when the Senate confirmed Alvaro Bedoya’s nomination to the five-member FTC, giving Khan and Democrats a majority. Bedoya’s arrival should pave the way for Khan’s agenda to scrutinize Big Tech and shape privacy and competition rules.
With no legislation to level the playing field, developers like Match Group Inc. MTCH,
and Epic Games Inc. have taken it upon themselves to sue Google and Apple for monopolistic business practices.
The question is when developers, consumers, privacy advocates, investors and Big Tech can expect antitrust laws, if ever.
“We have to take history into account. Only two narrow federal technology laws have been enacted in the past 25 years,” Chakravorti said. “Regulating railroads or tobacco took decades. August 8 is barely three months away.”