Bloomberg Businessweek December 7th, 2020 PP12-13|REMARKS|”A Global Reckoning for Big Tech”. “ China, the EU, and the U.S. aim to rein in the power of Alibaba, Amazon, Google, and other giants”. By Shelly Banjo
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While China, the EU, the U.K., India and the U.S. all have their differences they all share a going concern regarding the monopoly power of the tech giants like Alibaba, Amazon, Apple, Facebook, Google and others. The concerns unlike the past are not about high prices because these firms “have established trillion-dollar monopolies by charging consumers next to nothing.” So, the real issues now are the impact; of such pricing on small companies, on individual privacy, the unusual amount of data these companies control and worker’s rights. The pandemic, with lockdowns-mask-wearing & social distancing, not surprisingly, has exaggerated a worldwide reliance on these large firms often at the “expense of smaller competitors.” Since the start of the pandemic more than a fifth of small companies in America have closed. According to Amy Klobuchar (U.S. Senate D. Minn) "We could emerge from this pandemic with markets that are much more concentrated by charging customers next to nothing."
What are the claims?
China. “Chinese food delivery giant Meituan was forced to apologize after a restaurant association accused it of abusing its dominance during the outbreak by requiring merchants to sign exclusive agreements and charging restaurants commissions as high as 26%.”
France. “The French government postponed Black Friday to Dec. 4 to placate shopkeepers who accused Amazon.com of stealing their sales during the latest coronavirus lockdown.”
America. “Google isn’t simply dominant in search and advertising; it preserves its status as gatekeeper to the internet by using exclusionary practices that crush competitors, the U.S. Department of Justice alleged in a lawsuit in October.” American’s it's said are “increasingly skeptical of social media companies. According to a 2020 Pew Research study 60% see SM sector as having a negative impact and “almost half want more regulation” of SM.
Everywhere “Merchants both depend on and compete with Amazon, Spotify and other apps appear in Apple Inc’s app store but also compete with its music service.”
According to Sam Weinstein (Benjamin N. Cardozo School of Law) “At some point these companies get so big that even if you’re the Communist Party [China] you start to think ‘Who’s holding the reins.’”
So, what’s being done?
In the EU it was clear that local firms couldn’t compete “with Silicon Valley and Beijing in emerging areas of artificial intelligence, cloud computing and 5G wireless technology.” Margrethe Vestager, the EU’s competition chief, is trying to “police the market and encourage fair play.” She discovered that these dominant firms have “sniffed out sweetheart tax deals” that unfairly benefited Amazon and Apple etc. Since the EU has leveled high fines “on Google [but they] have not significantly changed the market dynamics.” New efforts against gatekeepers could “head off bad behavior before it happens by threatening fines, or breakups in severe cases, for companies that don’t share customer data with business rivals as well as for operators of marketplaces and search engines that favor their own services.”
China has collaborated with the EU in learning how to tackle these situations. As it is, the Chinese form of government has been more effective as they “implement[ed] an antitrust crackdown unveiling anti-monopoly rules last month that wiped $290B off the stock market valuation in two days.” They also suspended a “$37 billion stock offering by billionaire Jack Ma’s fintech powerhouse Ant Group Co.” According to Andrew Polk, all companies in China are “expected to, as some level, support state policy. And that’s not a conversation anywhere else in the world.”
America will continue the Justice Department’s “monopoly abuse suit already underway against Google” and legislation is being proposed, David Cicilline (D. R.I.) to arm “U.S. competition cops” with “new powers to safeguard not just consumers but also ‘workers, entrepreneurs, independent businesses, open markets, a fair economy, and democratic ideals.'”
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