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Bezos, Zuckerberg, Cook and Pichai prepare for their big day before Congress — here’s what to watch out for – CNBC

When the CEOs of Amazon, Apple, Facebook and Google parent Alphabet testify before Congress on Wednesday, it won’t be exactly what the House Antitrust Subcommittee members envisioned when they launched their probe last June. 

For one thing, it will be held over video conferencing software due to pandemic-related precautions, eliminating the optics of the four executives being sworn in before an elevated panel of lawmakers. And with 1.3 million documents already obtained from the companies, the testimony is unlikely to include any bombshells.

Regardless of how well-practiced the CEOs are when they take the witness stand, their testimonies will offer an important insight: how they are handling antitrust challenges from regulators with the authority to break them up.

The House Judiciary Committee’s probe into Big Tech is expected to end with a report and legislative proposals about how to update the antitrust laws to respond to new challenges posed by the digital marketplace. Those laws, if enacted, could have far-reaching and lasting effects on how federal and state regulators crack down on anti-competitive practices in the future.

But the more immediate threat to the four CEOs is a potential lawsuit from domestic and international regulators who have been probing the companies on the same issues the House panel is investigating. Those agencies have the authority to order the companies to alter their businesses or make onerous commitments.

Antitrust questions about the four companies are not uniform, and even an hours-long hearing will only scratch the surface. But the way it plays out will indicate how the companies are fighting antitrust arguments behind the scenes, what commitments they’re willing and unwilling to make under oath, and how likely bipartisan antitrust reform really is.

Big Tech on defense

Google has already faced fines from the European Commission’s competition authority over its shopping search tool and Android mobile operating system. In the U.S., it faces the most pressing threat of legal action against the four companies as the Department of Justice and state attorneys general move toward a lawsuit that could span issues ranging from its search product to digital advertising marketplace, according to a recent report from The Wall Street Journal. Questions about Google tend to center on whether it favors its own products or suppresses competing options through its dominance in search and digital advertising.

Facebook disclosed a new Federal Trade Commission probe into its business last year, just after the agency closed a privacy probe into the company with a $5 billion fine. Several state attorneys general have launched their own joint antitrust probe into the company. Facebook’s past acquisitions of nascent competitors like Instagram and WhatsApp are a particular sticking point. The company has more than 2 billion monthly users, making it the largest social media platform, and enforcement advocates have argued that those acquisitions could have become serious challengers if they’d been allowed to grow on their own.

Facebook founder and CEO Mark Zuckerberg arrives to testify following a break during a Senate Commerce, Science and Transportation Committee and Senate Judiciary Committee joint hearing about Facebook on Capitol Hill in Washington, DC.

Saul Loeb | AFP | Getty Images

Amazon CEO Jeff Bezos will face his first congressional hearing, and he’s likely to get questions about Amazon’s marketplace, where thousands of independent sellers sell new and used products, sometimes competing against Amazon itself. The FTC has been asking third-party sellers about what it’s like selling on Amazon’s marketplace, according to Bloomberg. Some members of the Judiciary Committee were outraged at a Wall Street Journal investigation earlier this year that found Amazon had used data from some of those sellers to create its own products, and suggested that some of Amazon’s past statements to the panel “appear to be misleading, and possibly criminally false or perjurious.”

Apple’s antitrust woes recently gained broader attention after a public spat with the leaders of a software company called Basecamp. The Basecamp executives aired their challenges in gaining approval for their new email service on Apple’s App Store, the only official place for users to download new apps on iPhones and iPads. While Apple ultimately approved the app and created a new way to challenge its App Store rules, the incident shed light on the potential antitrust issues the EU is now looking into, such as Apple’s opaque process for the app marketplace and its 30% commission fee on digital purchases consumers make through apps.

Some of the tech companies have already tipped their hand about how they will respond to claims monopolistic behavior. The arguments typically start by challenging the premise that they’re dominant players, slicing their markets and competitors to downplay the power they hold across all their spheres of influence. 

Apple last week released a study it commissioned that found its App Store fees and practices were generally in line with other digital marketplaces, rejecting the claim that its 30% commission on digital sales was out of step with industry trends.

NetChoice, a trade group that counts Amazon, Facebook and Google among its members, published a report called “Debunking the ‘Big is Bad’ Bogeyman: How Facebook Benefits Consumers.” The report aims to pick apart a recent paper outlining an antitrust argument against Facebook by arguing that it does not monopolize the social media market and faces robust competition from companies like TikTok.

Facebook CEO Mark Zuckerberg’s testimony will reportedly touch on the rise of TikTok, according to Bloomberg, as he paints Facebook as a patriotic counterbalance to upstart Chinese tech companies that lawmakers believe could pose a threat to U.S. security. Separate from the antitrust probe, lawmakers have expressed concern about TikTok and other Chinese-created apps, fearing they could collect valuable data on U.S. users that Chinese officials could force companies to hand over.

Facebook COO Sheryl Sandberg has previously pointed to the rise of Chinese tech companies when defending her company’s position, arguing that even if Facebook is broken up, Chinese companies won’t be.

But that argument may not sit well with lawmakers. Rep. Ken Buck, R-Colo., a member of the Antitrust Subcommittee whose amendment to a defense bill banning TikTok from government-issued devices recently passed in the House, said the threat of Chinese tech firms is separate from that of Big Tech’s dominance.

A man holding a phone walks past a sign of Chinese company ByteDance’s app TikTok, known locally as Douyin, at the International Artificial Products Expo in Hangzhou, Zhejiang province, China October 18, 2019.

Reuters

“I’m very concerned about China and their influence, but I think that’s a whole different story,” Buck said in an interview Monday with CNBC. “If we allow our tech companies to become so big that they stifle innovation in this country we will never be able to compete with China because that’s really what separates us from China is our ability to innovate and move forward.”

Rep. Pramila Jayapal, D-Wash., also dismissed the defense, saying in an interview it was not “legitimate.”

“Of course those things all get taken into account but that has nothing to do with monopolistic power and behavior via the antitrust laws that govern the way we do work and govern business regulation in this country,” she told CNBC. “It’s not a compelling factor, and the reality is that these companies have been engaged in this behavior for quite some time, and none of the data that we have seen in our investigation points to this being because China is coming in and trying to take business away. It’s not borne out by any of the documents.”

Spokespeople from Amazon and Google did not provide comment for this article. Representatives from Apple and Facebook did not respond to requests for comment.

Commitments under oath

The most tangible thing that could come from the panel are new commitments from the four CEOs. 

“Are they going to get any surprising new information? I highly doubt it,” a senior staffer for a Democratic member of the subcommittee said. “Now with that said, I do think there is a possibility that they get new commitments. There’s a difference between new information and new commitments.” The staffer spoke on the condition of anonymity, citing a lack of authority to comment publicly.

Some of those commitments may deal directly with the antitrust issues at hand: Will you commit to never ripping off a product or app sold on your marketplace? Will you commit to never purchasing a company you perceive to be a future threat to your business?

Others could run the gamut of other political issues: Will you commit to never taking down a post by a sitting president? Will you commit to fact-checking ads by all customers, including sitting presidents? Will you commit to never selling user data to third-party providers without their clear and explicit permission?

One line of questioning to watch for is a grilling of Bezos over Amazon’s use of data from third-party sellers. Antitrust Subcommittee Chairman David Cicilline, D-R.I., said Amazon’s witness at an earlier antitrust hearing “may have lied to Congress” about how the company uses data from its third-party sellers to come up with its private-label products following the WSJ report earlier this year. During a hearing in July 2019, Amazon general counsel Nate Sutton said Amazon does not use individual sellers’ data to inform its strategy, though it uses aggregated data to get a sense of how a product category is performing. 

Amazon Founder and CEO Jeff Bezos addresses the audience during a keynote session at the Amazon Re:MARS conference on robotics and artificial intelligence at the Aria Hotel in Las Vegas on June 6, 2019.

Mark Ralston | AFP | Getty Images

But the Journal’s report found that aggregate reports could contain as few as two sellers or easily expose individual performance metrics by other means. An Amazon spokesperson previously told CNBC it doesn’t allow employees to use “non-public, seller-specific data to determine which private label products to launch” and said it had opened an internal investigation, though it didn’t believe the allegations are true.

Jayapal is likely to take the opportunity to pin down Bezos on his stance on third-party seller data. She questioned Amazon’s general counsel about the data at the previous hearing, and her district includes Amazon’s headquarters in Seattle.

“That is important for me to follow up on because obviously I am extremely disturbed by the fact that their general counsel appears to have lied to me based on reports from papers like The Wall Street Journal,” she said. “So it won’t be a satisfactory answer to say that that was rogue behavior because we have constant data from multiple sources, multiple reports that Amazon does engage in accessing information that hurts third-party sellers and using that to benefit their own products and their own business lines, so I think I will certainly be following up on that.”

She said no decision has been made about whether an unsatisfactory answer could result in a perjury referral, but said once she hears what Bezos has to say, “everything’s on the table.”

Bipartisan appetite for change?

The hearing will also show whether there’s really a bipartisan appetite in Congress to change the antitrust laws.

When the investigation was launched last year, it had buy-in from top Democrats and Republicans on both the Judiciary Committee and Antitrust Subcommittee. But Judiciary Ranking Member Doug Collins, R-Ga., stepped down from the position during the probe as he pursues a Senate bid, handing the reins to Rep. Jim Jordan, R-Ohio. Jordan has signaled discontent with aspects of the investigation and hearing format in public letters to Chairman Jerrold Nadler, D-N.Y.

Before he left the role, Collins and Subcommittee Ranking Member Jim Sensenbrenner, R-Wis., wrote to Nadler, condemning remarks he delivered at a fundraising event about breaking up big companies. Nadler was not specifically calling to break up tech companies but rather talking about broad changes needed to dismantle concentrated market power, Politico reported at the time.

Representative Jim Jordan, Republican of Ohio, asks questions of witnesses U.S. Ambassador to Ukraine William Taylor and Deputy Assistant Secretary George Kent during the first public hearings held by the House Permanent Select Committee on Intelligence as part of the impeachment inquiry into U.S. President Donald Trump, on Capitol Hill in Washington, DC, November 13, 2019.

Saul Loeb | Pool via REUTERS

But Jordan has appeared as the sole signatory on several other letters questioning Democratic leadership’s decisions about the hearing itself. He has advocated for it to be held at the full committee level and asked for Twitter CEO Jack Dorsey to be invited to the hearing, despite not being a subject of the initial investigation. Jordan did not sign the bipartisan letter asking Bezos to testify following the WSJ report.

Questions from Republican lawmakers on the subcommittee could show how committed they remain to the initial goals of the investigation and whether they still have an appetite to amend the antitrust laws.

Buck said both Republicans and Democrats remain concerned that the large platforms could “stifle innovation.”

“This is the most bipartisan effort that I have been involved with in five and a half years of Congress and I’m really pleased with Chairman Cicilline’s leadership and willingness to share resources and be very open in the approach to these issues,” he said. “The only way really to get a well thought-through law as well as a law that will pass the House and Senate and be signed by the president is to work in a bipartisan fashion and I think Chairman Cicilline has great vision in how he has approached this issue.”

Still, several conservative members have signaled a focus on the alleged bias they believe platforms like Facebook and Google’s YouTube display in their algorithms and moderation of users’ content. Democrats have largely dismissed those concerns, and the companies have denied they build their products and policies in ways that discriminate against conservative voices.

Republican Buck said he expects issues of bias and privacy to come up mainly as they relate to anti-competitive behavior. He plans to focus his questions on behavior he believes should be regulated.

“I think that it’s clear that the [antitrust] law was written at a time when Big Tech didn’t exist and I think that there are new challenges now that we have to update the law to make sure that regulators have the tools and resources that they need to assure competitive behavior in the marketplace,” he said.

No matter how lawmakers reach their conclusions, the question to watch is whether members on both sides of the aisle see these companies as too powerful, and if updates to the antitrust laws could reset the balance.

WATCH: How US antitrust law works, and what it means for Big Tech

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Zuckerberg, Bezos, Cook and Pichai antitrust hearing rescheduled for Wednesday – CNET

gettyimages-1177753363

Facebook CEO Mark Zuckerberg testifying before a Congressional House Financial Services Committee in 2019. 


NurPhoto/Getty

Wednesday should be a historic day. Mark Zuckerberg, Jeff Bezos, Tim Cook and Sundar Pichai — the CEOs of Facebook, Amazon, Apple and Google-owned Alphabet — are scheduled to sit before the House Judiciary Subcommittee on Antitrust. The hearing, which was initially scheduled for Monday, has been rescheduled for noon Eastern, as Axios first reported on Saturday morning

A scheduling conflict was to blame for the delay. The late John Lewis, a Democratic representative and civil rights leader who died last week of pancreatic cancer, will lie in state in the Capitol Rotunda on Monday, it was announced on Thursday.

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Months in the making, the antitrust hearing aims to have four of the most powerful CEOs in tech defend accusations of monopolistic behaviors. All four tech giants have faced scrutiny over the past year from lawmakers and regulators, who not too long ago looked at Silicon Valley in a far more positive light. Now officials are raising concerns about these companies’ growing dominance in the market, which could be squashing competition. 

“Since last June, the subcommittee has been investigating the dominance of a small number of digital platforms and the adequacy of existing antitrust laws and enforcement,” House Judiciary Committee Chairman Jerrold Nadler and Antitrust Subcommittee Chairman David Cicilline said in a joint statement. “Given the central role these corporations play in the lives of the American people, it is critical that their CEOs are forthcoming. As we have said from the start, their testimony is essential for us to complete this investigation.”

During a committee hearing in January, smaller tech firms complained about unfair business practices from the tech giants. Sonos CEO Patrick Spence told lawmakers that Google tried to restrict his company’s innovations and wanted insights into Sonos’ future product plans. Sonos sued Google, claiming the company stole its wireless speaker technology. David Barnett, CEO of PopSockets, blasted Amazon for ignoring issues about counterfeit that he’d raised for months, bullying him to lower his prices.

“There’s such a dominant power that exists with these companies that really even as a company of our size you feel like you have no choice,” Spence said.

The process of getting all four CEOs in front of the committee was not without drama. Cicilline in May threatened to subpoena Bezos to appear at the antitrust hearing after sending an open letter to Bezos calling for his testimony. Bezos agreed to appear in June.

The hearing will stream live here.

CNET’s Richard Nieva and Michelle Meyers contributed to this report.

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Bezos to the Moon: Blue Origin joins SpaceX and Dynetics in a three-horse lunar lander race – The Register

NASA selects three contenders for flag-in-Moon prize

Blue Origin founder Jeff Bezos reveals the Blue Moon lander

With a scant few years remaining until the agency’s 2024 boots-on-the-Moon goal, NASA has named the three US companies that will be dealing with the tricky human landing bit of the mission.

The combined contract award of a cool near-billion dollars over the 10-month base period will be split between Jeff Bezos’ Blue Origin, Dynetics and SpaceX.

Big News! The #Artemis generation is going to the Moon to stay. I’m excited to announce that we have selected 3 U.S. companies to develop human landers that will land astronauts on the Moon: @BlueOrigin, @Dynetics & @SpaceX. https://t.co/mF6OzFqJJC pic.twitter.com/nuMQlDIyGS

— Jim Bridenstine (@JimBridenstine) April 30, 2020

Two of those will also be making use of United Launch Alliance’s (ULA) upcoming Vulcan launch system while the third continues to make big promises about its Starship, which seems to have taken a break from regular explosions and implosions during ground tests.

There was no love for Boeing, however, which has challenges of its own in getting NASA’s monster Space Launch System rocket to the launchpad.

Blue Origin’s pitch is a “national team” with Lockheed Martin dealing with the ascent element of the lander, Draper handling the guidance and navigation systems and Northrop Grumman taking care of transfer duties. Bezos’ crowd will be responsible for the descent portion of the system, with a lander powered by Blue Origin’s BE-7 engine.

The first uncrewed demonstrator is due in 2023, with humans bounding about the surface once more in 2024 should everything go to plan.

NASA’s Source Selection Statement for the Human Landing System (HLS) rated Blue Origin as “Acceptable” on the technical side and “Very Good” for management. However, even though $579m is due to be slung Blue Origin’s way, the selection board worried that “this system is comprised of multiple relatively low technology readiness level (TRL) systems that will be challenging to manufacture, integrate, and test.”

Dynetics scored higher, rated as “Very Good” in both categories, and leads a team with more than 25 subcontractors aimed at producing a launcher-agnostic, low-slung design. It nabbed $253m of the pot.

SpaceX scored $135m, with the selection statement rating it as “Acceptable” both technically and in management terms. However, the report worried that the proposed propulsion system was “notably complex” and did not address the potential for delays particularly well. The company plans to use its Super Heavy Booster to launch a Starship vehicle, which will perform the lunar landing.

At the end of a 10-month period of monitoring and review, NASA will likely whittle the field down further to those it reckons stand the best chance of meeting the increasingly ambitious 2024 deadline. ®

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