Massachusetts senator Elizabeth Warren is the first presidential candidate in the 2020 race to outline how she would take on Big Tech.
“Today’s big tech companies have too much power — too much power over our economy, our society, and our democracy,” Warren wrote in a new Medium post published today (March 8). “They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else. And in the process, they have hurt small businesses and stifled innovation.”
In her post, Warren recalls the 1990s antitrust proceedings against Microsoft. The case halted the company’s plans to dominate the web-browsing business, which would have likely given it control over the internet (paywall). Promoting competition “allows new, groundbreaking companies to grow and thrive ,” and pushes others to offer better products, Warren writes. “Aren’t we all glad that now we have the option of using Google instead of being stuck with Bing?”
Of course, Google and other Silicon Valley giants are Warren’s current targets. One approach she suggests: “platform utilities,” a new designation for any company that makes over $25 billion and offers an online marketplace or platform that connects third parties. These utilities would need to remain separate from platform participants, Warren says. So for example, Amazon’s main retail site and the Amazon companies that make products, like AmazonBasics, would have to be different companies.
Warren also says she would appoint regulators to use “existing tools” to unwind anti-competitive mergers, and offers seven examples:
- Amazon and Whole Foods (2017, sale price: $13.7 billion). With the acquisition of Whole Foods, Amazon has only about 2% of the very competitive US grocery market, but critics of the merger worried the retail giant would close brick-and-mortar stores and kill off future competitors in online grocery shopping.
- Amazon and Zappos (2009, sale price: $1.2 billion). The online shoe retailer was one of the several competitors Amazon acquired using reportedly aggressive tactics relatively early in its journey to becoming the e-commerce giant it is today.
- Facebook and WhatsApp (2014, sale price: $22 billion). Buying WhatsApp helped Facebook dominate the global mobile messaging market, and stave off the threat the app posed to its own Messenger service.
- Facebook and Instagram (2012, sale price: $1 billion). The acquisition of Instagram, a rising competitor, not only made Facebook an unstoppable advertising powerhouse, it could be key to securing Facebook’s future.
- Google and Waze (2013, sale price: $1.3 billion) Google already dominated the mobile mapping market with its Maps product when it bought Waze, it’s “most viable competitor,” a consumer watchdog said at the time.
- Google and Nest (2014, sale price: $3.2 billion) The smart-thermostat company recently rejoined Alphabet after several years as its subsidiary. At the time of the initial merger, critics noted that Nest is another trove of data for Google to mine.
- Google and DoubleClick (2007, sale price: $3.1 billion). Similarly, privacy advocates complained that allowing Google to buy the online advertising company would give it unparalleled access to user data.
“Unwinding these mergers will promote healthy competition in the market ,” Warren writes, “which will put pressure on big tech companies to be more responsive to user concerns, including about privacy.”