Democratic presidential candidate Sen. Elizabeth Warren has proposed breaking up the big tech giants, including Amazon, Facebook and Google, a move she says will help the “next generation of great American tech companies … flourish.”
“I want a government that makes sure everybody — even the biggest and most powerful companies in America — plays by the rules,” Warren wrote in a blog post. “And I want to make sure that the next generation of great American tech companies can flourish. To do that, we need to stop this generation of big tech companies from throwing around their political power to shape the rules in their favor and throwing around their economic power to snuff out or buy up every potential competitor.”
Warren, who has been seen as a foe of Wall Street, has said in the past that the largest technology companies, which account for over $2 trillion in market cap, need some reigning in.
In a 2016 speech, the Mass. Senator said companies such as Google, Apple and Amazon were using their size to “snuff out competition.” In Warren’s post on Friday, Apple was not mentioned.
Warren noted that “nearly half of all e-commerce” in the U.S. goes through Amazon, while more than 70 percent of all internet traffic comes from sites “owned or operated” by Google and Facebook, including sites such as YouTube and Instagram.
“As these companies have grown larger and more powerful, they have used their resources and control over the way we use the Internet to squash small businesses and innovation, and substitute their own financial interests for the broader interests of the American people,” Warren added in her post. “To restore the balance of power in our democracy, to promote competition, and to ensure that the next generation of technology innovation is as vibrant as the last, it’s time to break up our biggest tech companies.”
Google and Amazon have not yet responded to a request for comment from Fox News. Facebook declined to comment.
Rob Atkinson, president of the Information Technology and Innovation Foundation (ITIF), a think tank for science and technology policy, disagreed with Warren’s proposal.
“The Warren campaign’s call to breakup big tech companies reflects a ‘big is bad, small is beautiful’ ideology run amok,” Atkinson said in a statement obtained by Fox News. “The proposal ignores the fact that many of the services big tech companies now provide free used to cost consumers money. Breaking up large Internet companies just because they are large won’t help consumers. It will hurt them by reducing convenience, reducing quality of service and innovation, and in some cases leading to the introduction of priced services.”
Warren said the large tech giants had used mergers to “limit competition,” citing examples such as Facebook’s acquisitions of Instagram and WhatsApp; Amazon using its market power to “force” smaller competitors, such as Diapers.com to sell to the company; and Google buying mapping company Waze and advertising company DoubleClick.
She also mentioned that their marketplaces were used to limit competition. “Amazon crushes small companies by copying the goods they sell on the Amazon Marketplace and then selling its own branded version. Google allegedly snuffed out a competing small search engine by demoting its content on its search algorithm, and it has favored its own restaurant ratings over those of Yelp,” Warren wrote.
Warren proposed two ways of restoring competition to the tech sector, including passing legislation that would designate the large platforms as “platform utilities” and reversing already approved mergers, which she deemed “illegal and anti-competitive.”
Concerning the platforms and rebranding them as utilities, Warren said that companies with annual global revenues of $25 billion or more that offer online marketplaces, exchanges or places to connect third parties would be designated as utilities and be prohibited from owning both the platform and participants on the platform.
“Platform utilities would be required to meet a standard of fair, reasonable, and nondiscriminatory dealing with users. Platform utilities would not be allowed to transfer or share data with third parties,” she wrote.
For companies with smaller annual revenues, she proposed they “meet the same standard of fair, reasonable, and nondiscriminatory dealing with users, but would not be required to structurally separate from any participant on the platform.”
Warren specifically cited Amazon Marketplace, Google’s ad exchange, and Google Search as examples of platform utilities and said “Amazon Marketplace and Basics, and Google’s ad exchange and businesses on the exchange would be split apart,” while adding that Google Search would also have to be spun off.
With regards to mergers, Warren blasted regulators who approved purchases such as Whole Foods and Zappos for Amazon, as well as the aforementioned Facebook and Google purchases (in addition to Google’s acquisition of smart home company, Nest).
“Unwinding these mergers will promote healthy competition in the market — which will put pressure on big tech companies to be more responsive to user concerns, including about privacy,” she wrote.
Warren added that her proposals would not change the way the internet works, but would give small businesses and entrepreneurs a “fighting chance to compete against the tech giants.”
This story has been updated to include a statement from the Information Technology and Innovation Foundation.
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