Commentary

Bezos, Cook, Pichai, Zuckerberg Face Congressional Antitrust Grilling

Amazon CEO Jeff Bezos will encounter face-to-face congressional scrutiny for the first time tomorrow -- albeit via videoconferencing software due to COVID-19 -- as he and chief executives Tim Cook of Apple, Mark Zuckerberg of Facebook and Sundar Pichai of Alphabet respond to allegations of their enterprises skirting antitrust laws on their way to dominating their sectors.

“The congressional inquiry has been more than a year in the making. Lawmakers have amassed 1.3 million documents, conducted hundreds of hours of interviews and held five other hearings featuring the industry’s friends and foes. Led by Rep. David N. Cicilline (D-Rhode Island), the lawmakers plan to produce a report in coming months that some party leaders expect will find the industry has skirted federal competition laws because the protections haven’t kept pace with the digital age,” writes  Tony Romm for The Washington Post.

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“In recent decades, similar high-profile interrogations have yielded some of the country’s most important reforms, including safeguards to spare the economy from another financial collapse and rules to protect drivers, smokers, workers and countless others from a combination of corporate missteps and lax regulation,” Romm adds.

Bezos, in particular, “is expected to face an onslaught of critiques, with questions as varied as Amazon’s labor conditions and market power and his status as the richest person in the world,” David McCabe and Karen Weise observe  in The New York Times. The headline of their story reads: “Jeff Bezos Cast in a Role He Never Wanted: Amazon’s D.C. Defender.”

“Bezos “has jumped at opportunities to cast himself as a statesman -- the savior of The Washington Post, who holds court among the country’s elite. At the same time, he has eschewed the day-to-day grind of bolstering Amazon’s influence with policymakers,” they write, pointing out that he has taken a “hands-off approach” with Amazon’ policy and communications group, which employs more than 800 advocates globally. 

“Avery Gardiner, general counsel and senior fellow for competition, data, and power at the Center for Democracy and Technology, a nonprofit that works to shape tech policy, told Business Insider she expects Bezos will, first and foremost, have to supply answers to inquiries relating to Amazon's private-label business,” writes  BI’s Avery Hartmans.

“A Wall Street Journalreport  from April found that Amazon was using trend data gleaned from third-party sellers in order to develop its own private-label products. While offering private-label products in stores is nothing new, the committee is likely to explore whether Amazon wields more power as a digital marketplace than a brick-and-mortar store would,” Hartmans continues.

“By extension, Bezos will likely be asked who he sees as Amazon's most robust competitors -- in that case, Gardiner said, we're likely to hear a lot about how Amazon competes with Walmart.”

In The Wall Street Journal this morning, Sebastian Herrera points out  that Bezos likes to “stick to folksy talking points about Amazon’s rise” but he will be facing a tougher crowd than usual when he faces the House Antitrust Subcommittee.

“Former Amazon executives say they expect Mr. Bezos to prepare carefully and to maintain discipline in sharing several messages that have come up frequently in the company’s responses to scrutiny and criticism.

“One is that while Amazon accounts for a large volume of e-commerce sales, its overall size in U.S. retail is much smaller. Another is its ‘customer obsession,’ one of 14 principles long touted by Mr. Bezos and his team as an explanation for the company’s competitive behavior.”

Over on Vox, Jason Del Rey says “it’s about time” Bezos got grilled.

“Other people impacted by Amazon policies work in Amazon warehouses and delivery centers, earning pay rates and benefits that are often superior to that offered by retail competitors -- but some of these workers say they are asked to hit performance marks that some say are more suited to robots than humans. And then there are Amazon’s competitors -- big and small across a growing number of industries -- that have been flattened in the tech giant’s wake. When it comes to online retail, the pandemic has only accelerated the trend to online shopping and given Amazon a new leg up over many of its traditional retail competitors,” Del Ray writes. 

Look for other issues to emerge during hearings, too, Brian Fung writes  for CNN Business.

“In some sense, the hearings can be viewed as a culmination of years of mounting scrutiny and criticism of the tech industry's impact on privacy, civil discourse, hate speech and elections. But those issues may have less to do with specific antitrust claims than a perception that the platforms have simply become essential services. Still, even though those issues are less directly tied to competition, many analysts widely expect them to be raised at the hearing.”

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