Has Big Tech Finally Become Too Big for the FTC to Ignore?

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Yesterday the Federal Trade Commission (FTC) announced that the agency will hold a series of public hearings beginning later this year on whether broad-based changes in the economy, evolving business practices, new technologies, or international developments require adjustments to competition and consumer protection enforcement law, enforcement priorities, and policy. Based on the questions these hearings will delve into, the clear aim of these hearings will be whether big tech giants in Silicon Valley have grown too big and wield too much power.

Some of the questions the FTC is interested in investigating and discussing during this inquiry include whether changes in the economy and evolving businesses have created competition and consumer protection issues in communication and information technology networks, market power and entry barriers in markets featuring “platform” businesses, the role of intellectual property in competition, and a variety of issues surrounding the security and use of big data.

Citing the 1995 hearings of then-FTC Chairman Bob Pitofsky, which focused on global competition and innovation, current FTC Chairman Joseph Simons said that these hearings would be similar in scope and purpose.


“A fundamental characteristic of a strong institution is a willingness to engage with new ideas and, in our case, changes in markets and business-to-business and business-to-consumer relationships,” Simons wrote in a prepared statement released along with the announcement. “In that spirit, I am announcing today a new public hearings project – Hearings on Competition and Consumer Protection in the 21st Century – that pays tribute to, and is modeled after, the Pitofsky Hearings. This project reflects the spirit, style, and, most importantly, broad scope of that effort.”

The hearings and public comment process will provide opportunities for FTC staff and leadership to obtain the views of those representing a diverse range of viewpoints. Additionally, the hearings are intended to stimulate internal and external evaluation of the FTC’s law enforcement and policy agenda.

In advance of these hearings, public comments on any of the following topics may be submitted to the FTC. These topics are discussed in more detail at Public comment topics and process.

  1. The state of antitrust and consumer protection law and enforcement, and their development, since the Pitofsky hearings;
  2. Competition and consumer protection issues in communication, information, and media technology networks;
  3. The identification and measurement of market power and entry barriers, and the evaluation of collusive, exclusionary, or predatory conduct or conduct that violates the consumer protection statutes enforced by the FTC, in markets featuring “platform” businesses;
  4. The intersection between privacy, big data, and competition;
  5. The Commission’s remedial authority to deter unfair and deceptive conduct in privacy and data security matters;
  6. Evaluating the competitive effects of corporate acquisitions and mergers;
  7. Evidence and analysis of monopsony power, including but not limited to, in labor markets;
  8. The role of intellectual property and competition policy in promoting innovation;
  9. The consumer welfare implications associated with the use of algorithmic decision tools, artificial intelligence, and predictive analytics;
  10. The interpretation and harmonization of state and federal statutes and regulations that prohibit unfair and deceptive acts and practices; and
  11. The agency’s investigation, enforcement, and remedial processes.

With networks, market power, platforms, intellectual property and big data being the focal point of the FTC inquiry, there is little doubt that the big tech giants of Silicon Valley are the targets of this FTC competition review. For those in innovator community the feeling will no doubt be that such a government inquiry is long overdue.

The market power of the big tech giants is almost difficult to comprehend, with each company being an order of magnitude larger than Standard Oil when the government decided to break up that monopoly, which remains the textbook example of a company that had grown too large and became abusive with its power. Furthermore, the way the tech giants have ignored patent rights and trampled on innovators has led to a stagnation of innovation and a culture of copying. When there is no penalty for copying you quickly find yourself in an economy full of copyists where innovation inches forward rather than leaps forward.

The FTC invites public comment in stages throughout the term of the hearings.

  • Through August 20, 2018, the Commission will accept public comment on the topics identified in the announcement. Each topic description includes issues of particular interest to the Commission, but comments need not be restricted to these subjects.
  • Additionally, the Commission will invite specific comments on the topic of each hearing session. The FTC will issue a news release before each session to inform the public of the agenda, the date and location, and instructions on submitting comment.
  • The Commission will also invite public comment upon completion of the entire series of hearings.

Public comments may address one or more of the above topics generally or may address them with respect to a specific industry, such as the health care, high-tech, or energy industries.  Any additional topics for comment will be identified in later notices.

The hearings will begin in September 2018 and are expected to continue through January 2019 and will consist of 15 to 20 public sessions. All hearings will be webcast, transcribed, and placed on the public record. A dedicated website for information about the hearings including the schedule as it evolves can be found at www.ftc.gov/ftc-hearings.


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Join the Discussion

5 comments so far.

  • [Avatar for Joachim Martillo]
    Joachim Martillo
    June 23, 2018 10:47 am

    Necessity of breaking up Google should be obvious. A patent system is important means to stabilize a capitalist economic system. When a company becomes large enough effectively to undermine the patent system and thus to destabilize the economy, that company is probably too large.

  • [Avatar for Ted the bear]
    Ted the bear
    June 22, 2018 01:33 pm

    It is hard to view a company like Alphabet Inc. as a simple monopoly. A monopoly equates to being “the only sign on the highway” for a particular service, whereas Google IS the highway when it comes to software.

    While their ability to steamroll competition in the CAFC may stifle innovation, any action against them causing considerable business impact would effectively “turn back time” in the affected industries.

    Unless similar data protection regulations to GDPR were enacted state-side, causing a dramatic change to the pricing model of these tech giants’ services, it is hard to see new regulations lowering the barrier of entry. In fact, it would likely do the opposite for a vast majority of smaller entities. Not to say that this is right, just that it will be an uphill battle for innovators.

  • [Avatar for Chris Gallagher]
    Chris Gallagher
    June 22, 2018 05:50 am

    Let’s be sure to raise the issue of “efficient infringement”

  • [Avatar for temorit]
    June 21, 2018 04:09 pm

    Based on some mergers we’ve seen approved in the past few years, the “antitrust” law that we learned in law school or of years past is long gone. Now it’s like “oh, you have 50% market share? How about some government subsidies and protections to help you out?”

  • [Avatar for Anon]
    June 21, 2018 11:40 am

    Is Mr. Iancu invited to share his “let’s change the dialogue” message?