Tech giants subject of antitrust investigations

Global Business

When it comes to big tech – how big is too big?

That’s the question a number of state officials are asking, as they look into possible anti-trust violations by Google.

And it’s not the only tech giant that some think should be cut down to size.

CGTN’s Hendrik Sybrandy reports.

As Texas’ Attorney General puts it, “now, more than ever, information is power and perhaps the most important source of information in our lives is the internet.”

When most people think of the internet, he said, they no doubt think of Google.

“Your lifeblood, my lifeblood, is searching on Google,” said John Holcomb, who teaches business ethics and law at the University of Denver’s Daniels College of Business.

He said Google has become so dominant in digital search and advertising that its critics claim the company features some products and web sites to the disadvantage of other application software and other companies that want to advertise on Google.

There’s evidence, four dozen U.S. attorneys general argue, that Google has controlled the flow of online information, stifled innovation and undermined consumer choice. They’re investigating the company for antitrust violations and reportedly met in Denver recently to discuss next steps.

“The search result invariably is laden with Google-related goods, services and those who pay Google,” said D.C. Attorney General Karl Racine recently. “That’s a very different model than that model with which they began.”

A similar investigation is now being conducted into Facebook, which, like Google, is being examined for possibly mishandling its users’ private data. Other tech titans are under the legal microscope too.

“If these guys are able to collect the data and there’s no sort of recourse if it’s not protected or if they proactively go out and sell it, that’s where regulators are concerned,” said Whitney Traylor who teaches business law at Metropolitan State University of Denver.

U.S. antitrust laws were first enacted to promote competition for the benefit of consumers. Now members of both political parties, at the state and federal level, are looking into whether tech giants, like the so-called Big Four (Google, Facebook, Apple and Amazon), have amassed so much market power that they’re monopolies squashing competition.

“When you have bipartisan agreement to go after some of these companies, then you’re in real trouble,” Holcomb pointed out.

There’s debate about whether current antitrust laws are adequate for the new tech age or whether stronger ones are needed. Some believe tech giants should be broken up to boost competition and level the playing field which Holcomb thinks could actually benefit the Big Four.
“If the analysts are right that this will unlock value for stockholders, is it necessarily going to have a downside effect on consumers?” he asked. “I would expect not.”

Last week, Google demanded investigators provide safeguards for sensitive business documents that it’s been asked to turn over.
“They’re fighting back,” Holcomb said. “Everybody’s going to fight back.”

Years of litigation may lie ahead, or “It can be everybody coming to an agreement and there’ll be a lot of energy put towards that effort,” Traylor said.

As much energy as consumers spend on services like Google Search? We’ll see.

“They’re going to walk over coals before they give that up,” Holcomb said.