The top executives at four of the world’s largest and most powerful technology companies are testifying Wednesday before Congress in the culmination of a year-long antitrust inquiry.
The House Judiciary Committee’s antitrust arm will grill Amazon’s Jeff Bezos, Apple’s Tim Cook, Facebook’s Mark Zuckerberg, and Google’s Sundar Pichai on the power their companies wield in the tech sector.
“Our founders would not bow before a king nor should we bow before the emperors of a digital economy,” said Rep. David Cicilline, chair of the antitrust subcommittee, in opening remarks.
The executives are testifying remotely due to the ongoing coronavirus threat, creating a different dynamic than the blockbuster hearings of the past, like Zuckerberg’s testimony on election interference in 2018. Cicilline reminded the CEOs that they are not allowed to take input from their teams during testimony, but it isn’t clear how or if the committee is enforcing that rule.
Early questioning focused on Facebook’s acquisition of Instagram, Apple’s treatment of third-party app developers, and Google’s dominance in search. More than an hour into the hearing, lawmakers still hadn’t posed any questions to Bezos, even though it is the Amazon chief’s first time testifying before Congress.
After nearly two hours, the first question for Bezos came from Rep. Pramila Jayapal, a Democrat from Washington who represents Amazon’s hometown, Seattle.
“The issue that we’re concerned with here his very simple,” she said. “You have access to data that far exceeds the sellers on your platform with whom you compete … you have access to the entirety of sellers’ pricing and inventory — information past, present, and future — and you dictate the participation of third-party sellers on your platform, so you can set the rules of the game for your competitors but not follow those rules yourself. Do you think that’s fair to the mom and pop businesses who can sell on your platform?”
Underlying Jayapal’s line of questioning is a Wall Street Journal investigation from April that found Amazon uses detailed data on third-party sellers in its marketplace to inform the development of in-house products.
Bezos said Amazon has a policy prohibiting such use of seller data but, “I can’t guarantee you that that policy has never been violated.”
Jayapal was following up on testimony that Amazon attorney Nate Sutton gave one year ago before the same committee claiming the company does not use individual seller data to inform its private-label product strategy.
Jayapal also grilled Zuckerberg on its acquisition strategy, accusing Facebook of threatening to copy Instagram and Snapchat while in discussions about buying them.
“You’ve used Facebook’s power to threaten smaller competitors and ensure that you always get your way,” she said. “These tactics increase your dominance … Facebook’s model makes it impossible for new companies to flourish successfully.”
Zuckerberg said he did not remember threatening competitors and defended the practice of developing features that consumers were demanding at the time.
Rep. Mary Gay Scanlon raised a controversial price war between Amazon and Diapers.com that ultimately ended in Amazon acquiring the competitor’s parent company and then shutting it down. Scanlon claimed Amazon lowered prices on diapers to drive the competitor out of business and then raised them when the competitive threat was eliminated.
“I don’t remember that at all,” Bezos said. “What I remember is that we matched competitor prices.”
The long-awaited hearing comes as the companies in question field investigations into alleged anti-competitive behavior from regulators in the United States and abroad.
The Federal Trade Commission and Department of Justice have divvied up the four companies as they investigate whether antitrust law has been violated. The House began its own inquiry a year ago and several states are also looking into the dominance of the nation’s largest tech companies.
We’ll be following along and updating this story throughout the day. Check back for highlights and analysis from the historic hearing and read prepared remarks from Bezos, Cook, Zuckerberg, and Pichai.
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