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Dec 13, 2018

The Technology 202: Trump and Democrats signal support for antitrust action on tech companies

By Cat Zakrzewski Cat Zakrzewski Technology




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Congressman David Cicilline talks to reporters during a news conference at a hotel in Yangon, Myanmar November 21, 2017. REUTERS/Soe Zeya Tun
House Democrats and President Trump are signaling that antitrust action is on the table as they seek to limit the expanding influence of large technology companies.
The incoming Democratic majority indicated support for strong enforcement of antitrust law in a pair of hearings this week, just weeks after Trump said his administration is “looking at” Facebook, Google and Amazon for antitrust violations. Lawmakers are upping the pressure as the Federal Trade Commission holds a series of hearings to determine whether competition and consumer protection laws need to be modernized to address the unique power now wielded by the tech industry. (Amazon founder and chief executive Jeffrey P. Bezos owns The Washington Post.)
Rep. David N. Cicilline (D-R.I.), the incoming chair of the House Judiciary Antitrust subcommittee, said during this week’s Google hearing that he’s ready to work with the FTC to develop legislation cracking down on large technology companies that could use their massive platforms to discriminate against their business rivals. At a time when the European Union has been far more aggressive in its antitrust action against American technology companies than U.S. regulators, Cicilline’s line of questioning indicated he wants the United States to take on more of these cases.
Lawmakers can’t force the FTC to bring action against companies, but they can keep a spotlight on the issue and pressure on regulators. They could also write legislation to help adapt antitrust law to the modern economy, as some say the 104-year-old trade commission isn’t equipped to tackle today's technology competition issues.
They might have an unlikely ally in Trump, who has had a contentious relationship with the technology titans since his presidential campaign. On Twitter, the president has said Google is “controlling what we can & cannot see.” He's had very public battles with Amazon and Bezos over the years, and alleged  on Twitter that Bezos bought The Post to protect the company from antitrust cases
Former FTC chair William Kovacic, who served under George W. Bush, said political support for antitrust action clears the way for agencies to act. He said as the Democrats are installed in the House majority, their new influence should be taken seriously.
“They can use a number of soft policy tools at their disposal,” he said. “That does create some pressure on the agencies to act.”
In an exclusive interview with Post reporters Tuesday following his Hill testimony, Google chief executive Sundar Pichai defended the company's size, contending Google is able to focus on the long term and make research-and-development investments “where we don’t see clear returns as a company.”  
“My honest answer on the scale of tech is that there's a lot of constant disruption of tech, and that's always been the constant,” Pichai said.
He pushed back on the argument that any one player is getting too big by pointing out that many companies that were dominant a decade ago are now gone and that major upstarts, like Uber, were soon going public.
“To me when I look at the platforms and I look at the newer apps coming on top of the platforms, there’s evidence that there’s a lot more choice today for users,” Pichai said. 
During two hearings in Washington this week, Cicilline previewed how he might wield his new authority in expressing concerns with Google and Facebook’s alleged discriminatory practices against competitors.
“I strongly support an open, decentralized Internet that is free of powerful gatekeepers with the ability to discriminate against rivals, threaten innovation, or harm consumers,” Cicilline said.
He pressed Pichai on whether the company would commit to stop alleged discrimination against its business rivals through Google products, a charge the Google head denies. In recent years, E.U. regulators have levied several fines against Google, including one for downgrading its rivals in its search results while giving prominent placement to its own comparison shopping service. Google made changes to operate the European Union, but has appealed the fine, a process which could take years. 
Cicilline also called out Facebook for anti-competitive conduct. He argued the social media giants “exploited its dominant position to harm rivals” by discriminating against its rival Twitter. Cicilline was referring to revelations in emails published by British lawmakers last week that showed Facebook executives including Mark Zuckerberg decided to limit Twitter's access to Facebook's user data when the company was launching the video app Vine.
At least one prominent Republican agrees. Rep. Bob Goodlatte R-Va.), the outgoing chair of the House Judiciary Committee, said in a Fox News interview that federal antitrust law must be reviewed at a time when Google controls more than 90 percent of the search market. The chairman’s comments came a day after he pressed Pichai on whether his search engine is biased against conservatives — a claim that Google and third-party researchers have staunchly denied.
“I would prefer not to regulate, but I do think the application of our antitrust laws — which promotes fair competition — needs to be reviewed,” Goodlatte told Fox News.
During the antitrust hearing, Goodlatte went so far to say that antitrust law could be a way to address his concerns of anti-conservative bias. 
A former FTC commissioner told me the bias issue should be viewed separately from the competition one.
Goodlatte's position, however, are not representative of all Republicans, who -- with the major exception of Trump — largely oppose increased regulation of tech companies. A Koch network representative said he hoped the incoming House Judiciary panel leadership would display a “stronger grasp on how tech platforms actually operate.”
“Using the threat of antitrust enforcement as a political weapon should be cause for concern for every American,” said Billy Easley, senior policy analyst at Americans for Prosperity, one of the Koch's political arms. “Chairman Goodlatte’s claim that tech companies are demonstrating bias toward conservatives is not only unfounded, but creates a dangerous public narrative.”
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BITS, NIBBLES AND BYTES

Google chief executive Sundar Pichai appears before the House Judiciary Committee on Dec. 11. (Melina Mara/The Washington Post)
BITS: Pichai told The Post in an interview while he was in town this week the tech industry should be left to self-regulate its use of artificial intelligence. But he also acknowledged that worries over the potential misuse of AI are “very legitimate.” “Regulating a technology in its early days is hard, but I do think companies should self-regulate,” Pichai told my colleagues Tony Romm, Drew Harwell and Craig Timberg. “This is why we've tried hard to articulate a set of AI principles. We may not have gotten everything right, but we thought it was important to start a conversation.”
Pichai also stressed the need to include people who don't come from a computer engineering background in conversations about technology use. “In some sense you do want to develop ethical frameworks, engage non-computer scientists in the field early on,” he told The Post. “You have to involve humanity in a more representative way, because the technology is going to affect humanity.”

Federal Communications Commission Chairman Ajit Pai arrives for a Federal Communications Commission meeting in Washington on Dec. 14. (Jacquelyn Martin/AP)
NIBBLES: An advocacy group said a Federal Communications Commission decision affirming that wireless carriers can block unwanted text messages could allow those companies to censor messages. “The FCC voted 3-to-1 to classify text messages as an information service rather than a telecommunications service, which it said would have limited the ability of wireless carriers to combat robotexts and spam messages,” Reuters's David Shepardson reported. Ajit Pai, the commission's chairman, said that “the FCC shouldn’t make it easier for spammers and scammers to bombard consumers with unwanted texts,” as quoted by Reuters.
The advocacy group Public Knowledge decried the FCC's decision, saying it could let carriers discriminate against messages. “This decision does nothing to curb spam, and is not needed to curb spam,” Harold Feld, senior vice president at Public Knowledge, said in a statement. “It is simply the latest example of Chairman Pai’s radical agenda that puts companies ahead of consumers.” FCC Commissioner Jessica Rosenworcel, a Democrat, also criticized the decision, the Verge's Colin Lecher reported. The FCC decision applies to SMS and MMS messages, as the Verge noted.
From Rosenworcel:
Let's be honest, today's @FCC decision offers consumers no new ability to stop robotexts. It simply provides that carriers can block our text messages & censor the very content of the messages themselves. Calling this decision anything else is doublespeak. https://t.co/BoUugKgpYc
— Jessica Rosenworcel (@JRosenworcel) December 12, 2018

A spectator uses an iPhone during an NBA basketball game in Oklahoma City on Jan. 17, 2014. (Larry W. Smith/European Pressphoto Agency)
BYTES: The California Public Utilities Commission is set to vote next month on a plan to create a fee for sending text messages to help fund access to phone services for poor people, the San Jose Mercury News's John Woolfolk reported. Several business groups as well as the CTIA, which represents the wireless communications industry, oppose the project. The wireless industry says such a surcharge would be unfair because it would affect carriers but not services such as WhatsApp, Facebook Messenger and Apple's iMessage, according to USA Today's Dalvin Brown.
“It’s a dumb idea,” Jim Wunderman, president of the Bay Area Council, an advocacy group sponsored by businesses, told the Mercury News. “This is how conversations take place in this day and age, and it’s almost like saying there should be a tax on the conversations we have.” Users probably would have to pay a flat surcharge rather than a fee per text, Woolfolk reported.
PRIVATE CLOUD

Elon Musk, founder of the Boring Company, speaks at a news conference in Chicago on June 14. (Kiichiro Sato/AP)
— Elon Musk's plan for a tunnel between downtown Chicago and O'Hare International Airport is advancing — and giving him a chance to show whether his Boring Company can produce viable tunnels. Tom Budescu, managing director of finance at the Chicago Infrastructure Trust, which is tasked with negotiating the project on behalf of the city, said Musk's Chicago project is halfway through an environmental assessment, Bloomberg News's Sarah McBride and Janan Hanna reported.
“The project’s advancement through the early stages of environmental review signals brisk momentum for a company that launched only two years ago, but also presents a challenge,” McBride and Hanna wrote. “Musk has yet to prove he can get one of his several proposed tunneling initiatives beyond the concept stage and into commercial service.”
— More technology news from the private sector:
Unfettered genius. Unpredictable rages. Here's what it was like to work at Tesla as Model 3 manufacturing ramped up and the company's leader melted down.
Wired
Apple plans to invest $1 billion to build a new campus in Austin that could create 15,000 jobs, as it seeks to make good on its promises to strengthen its contributions to the economy.
The Wall Street Journal
Analyst sees slower App Store, Licensing, Apple Care growth
Bloomberg News
Amazon’s announcement that it will bring 25,000 new jobs each to New York and Northern Virginia sparked a frenzy of activity. Lost in the commotion: It will take many years, if not a decade, before residents see an army of Amazon employees invading their cities.
The Wall Street Journal
A new scandal over Uber’s self-driving cars suggests that while Dara Khosrowshahi may have cleaned up the sexism, a reckless competitive streak still defines the company’s DNA.
Vanity Fair
Uber controls the majority of U.S. ride-hailing but Lyft is growing twice as fast. And both plan to go public in early 2019.
Recode
The purchases of AOL and Yahoo, at a cost of nearly $9 billion, haven't turned out as planned.
Hamza Shaban
Google's top AI researcher, Geoff Hinton, discusses a controversial Pentagon contract, a shortage of radical ideas, and fears of an "AI winter."
Wired
The second annual AI Index report pulls together data and expert findings on the field’s progress and acceleration.
The Verge
PUBLIC CLOUD

Sen. Brian Schatz (D-Hawaii) in his office on Capitol Hill in Washington on June 28, 2017. (Melina Mara/The Washington Post)
 A new Senate bill previewed what Democrats want to see included in a national privacy law next year. Sen. Brian Schatz (D-Hawaii) and 14 other Democratic co-sponsors introduced a measure that would require online providers to “take responsible steps” to protect users' information, according to a news release from Schatz. The measure, titled the "Data Care Act," would also aim to curb the misuse of personal data and could be enforced both at the federal and state levels.
“Just as doctors and lawyers are expected to protect and responsibly use the personal data they hold, online companies should be required to do the same,” Schatz said in a statement. “Our bill will help make sure that when people give online companies their information, it won’t be exploited.”
Under the bill, online providers would have to abide by three kinds of duties, according to Schatz's news release.  A “duty of care” would require those companies to “reasonably secure” personal data and inform users in the event of a data breach. The companies would not be allowed to use that data “in ways that harm users” under a “duty of loyalty.” Finally, under a “duty of confidentiality,” third parties would also be bound by the same requirements to protect users' information.
— An Amazon executive's response to a question about the company's relationship with U.S. Immigration and Customs Enforcement elicited an audible rebuke from protesters during a hearing of the New York City Council, according to Business Insider's Paige Leskin. “We believe the government should have the best available technology,” Brian Huseman, vice president of public policy at Amazon, replied when he was asked about the company's interactions with ICE. Amazon told Leskin that it “wasn't the intent” of Huseman's comments to confirm whether ICE uses software from Amazon.
— More technology news from the public sector:
New York City council members questions Amazon executives and the head of New York City's Economic Development Corporation about why the government granted Amazon nearly $3 billion in incentives to build on Long Island City.
CNBC
A landmark U.S. bill that would speed adoption of self-driving cars is now “a long shot” to pass before the current Congress adjourns in the coming weeks, a key Republican senator behind the legislation said.
Reuters
The Senate passed the 21st Century IDEA Act, giving agencies one year to improve citizens’ digital experiences.
Nextgov
Billionaire philanthropist Tom Steyer is putting out feelers on the professional networking website LinkedIn for several high-level campaign staffers in three crucial early-voting states.
The Hill
FAST FWD

The Google logo at the company's headquarters in Mountain View, Calif., on July 19, 2016. (Marcio Jose Sanchez/AP)
— A Google training document provides guidelines for employees when dealing with temporary workers, vendors and contractors, who the company refers to as TVCs. “The risks Google appears to be most concerned about include standard insider threats, like leaks of proprietary information, but also — and especially — the risk of being found to be a joint employer, a legal designation which could be exceedingly costly for Google in terms of benefits,” the Guardian's Julia Carrie Wong reported.
“Google’s treatment of TVCs has come under increased scrutiny by the company’s full-time employees (FTEs) amid a nascent labor movement at the company, which has seen workers speak out about both their own working conditions and the morality of the work they perform.”
#TRENDING
If your algorithms are smart enough to realize that I was pregnant, or that I’ve given birth, then surely they can be smart enough to realize that my baby died, and advertise to me accordingly — or maybe, just maybe, not at all.
Gillian Brockell
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