Biden's DOJ backs legislation prohibiting Apple from favoring its own apps

From Ryan Tracy's "Antitrust Bill Targeting Amazon, Google, Apple Gets Support From DOJ" posted Tuesday by the Wall Street Journal:

The Justice Department Monday endorsed legislation forbidding large digital platforms such as Amazon and Google from favoring their own products and services over competitors’, marking the Biden administration’s first full-throated support of the antitrust measure.

“The Department views the rise of dominant platforms as presenting a threat to open markets and competition, with risks for consumers, businesses, innovation, resiliency, global competitiveness, and our democracy,” says a letter to bipartisan leaders of the Senate Judiciary Committee, signed by Peter Hyun, the Justice Department’s acting assistant attorney general for legislative affairs.

The letter, obtained by The Wall Street Journal, expresses support for the American Innovation and Choice Online Act, which the Senate’s judiciary panel approved in January in a bipartisan vote, as well as similar legislation moving through the House.

Amazon.com Inc., AlphabetInc.’s GOOG +0.88% Google, Apple Inc. AAPL +0.85% and others oppose the proposed legislation, saying it would make it harder to offer popular services. The bills’ opponents also say it is fair for e-marketplaces, search engines and app stores to profit off their creations’ popularity.

The department’s letter throws its weight behind a different view: that the platforms’ dominant position gives them unchecked power to influence the fate of other businesses, and that restricting the platforms’ conduct would carry significant benefits.

“Discriminatory conduct by dominant platforms can sap the rewards from other innovators and entrepreneurs, reducing the incentives for entrepreneurship and innovation,” the letter says. “Even more importantly, the legislation may support the growth of new tech businesses adjacent to the platforms, which may ultimately pose a critically needed competitive check to the covered platforms themselves.”

Here's a link to the letter

My take: Tommo_UK saw this coming. Me, I recall Rep. Ro Khanna's  interview with Kara Swisher last week in which he suggested that any legislation targeting big tech faced an uphill fight given how popular companies like Apple are and how unpopular Congress is.

See Kara Swisher: Who made Tim Cook president?

22 Comments

  1. Kirk DeBernardi said:
    Apple might as well get into energy production as they’re about to be roped and tamed as a utility by fiat.

    1
    March 29, 2022
  2. Fred Stein said:
    We need a law to allow all sports franchises to allow anyone to sell branded soft drinks in their venues.

    As a brilliant innovator, here is my million dollar idea. Buy a few pallets of soda from Costco and pay some min wage kids to sell the soda for $2 that cost 25 cents. I’ll use a contract labor org to eliminate any liability. Brilliant, eh? helping grow the economy, creating jobs…….

    7
    March 29, 2022
  3. Fred Stein said:
    Sorry, Judge Gonzales, we’ll make success illegal.

    2
    March 29, 2022
  4. Dan Scropos said:
    “The Department views the rise of dominant platforms as presenting a threat to open markets and competition, with risks for consumers, businesses, innovation, resiliency, global competitiveness, and our democracy.”

    The above is utter bullshit. It would be more accurate if you changed the word “dominant” with “popular” or “most trusted.”

    5
    March 29, 2022
    • Robert Paul Leitao said:
      Dan: In business school we learned that economic and industrial policies championed by academics work until they are applied. Unfortunately, the academics pushing these theories have nothing to lose. Regulators in government service have mostly recession-proof employment and are isolated from the economic impact of their actions. The operative word in that last quoted sentence is “may.” Where’s the data supporting the contention and exactly who or what “may” benefit from the overt government action? Or, is the action being taken in some foggy effort at “fairness” with precise and specifically targeted outcomes not defined?

      4
      March 29, 2022
  5. Michael Goldfeder said:
    Then they also need to first investigate the NBA for discriminatory practices against dwarfs, elves, munchkins, and Ewoks.

    6
    March 29, 2022
  6. bas flik said:
    strange that usa government has an urge to destroy there own companies. terrible demostroyers. i miss Trump.

    3
    March 29, 2022
  7. David Emery said:
    “Discriminatory conduct by dominant platforms can sap the rewards from other innovators and entrepreneurs, reducing the incentives for entrepreneurship and innovation,” the letter says. “Even more importantly, the legislation may support the growth of new tech businesses adjacent to the platforms, which may ultimately pose a critically needed competitive check to the covered platforms themselves.”

    The problem I’m having is “Cui Boni”… It’s clear this legislation is focused not on benefiting consumers, but on benefiting (potential) competitors. Of course, consumers don’t spend megabucks on lobbying (or on carefully constructed PR/court cases, either…)

    6
    March 29, 2022
    • Tommo_UK said:
      David, no it’s aimed at benefitting competitors or anyone else really, but keeping regulators powerful in highly paid jobs because they’re paid to regulate high profile companies to justify their very existence. Simplez.

      5
      March 29, 2022
  8. John Konopka said:
    In the case of Apple, what apps does it favor? I don’t see iWork promoted in the App Store. iMovie, GarageBand, mail, messages are free. Maybe they want Apple to charge for these?

    1
    March 29, 2022
  9. Jerry Doyle said:
    There is much political instability coming soon from the mid-term elections that will send a clear message to Congress on specific issues of importance to the American people. I’m not being facetious. Folk are pissed over the Congressional and Executive Branch time spent on activities such as American Innovation and Choice Online Act. The Senate’s judiciary panel bipartisan vote was perfunctory, and for show. What came forth from that panel never will see the light of day on the chambers’ floors. After the results from the mid-term elections Congressional members will be scurrying everywhere during the last two years of the Biden administration to survive the 2024 election relative to public annoyance on issues that truly matter to them. Even the Biden administration’s ostensible support for this proposed legislation will vaporize as the last two years of the administration will target the public’s demand on issues that matter to hold office. A clear message from the mid-term election will be sent to Congress that this proposed legislation is not the path for incumbency retention.

    To reiterate and to recapitulate: this proposed legislation never sees the “light-of-day.” My Congressional office holders already have been placed on alert that this proposed bill is not the problem we demand Congress to address.

    1
    March 29, 2022
  10. Walmart often positions POS displays of their store brand at the store entrance or at eye level on the shelves. Exxon favors fuel & oil with their additives at stations displaying their signs. Congress will face challenges or else the bill will be watered down.
    Sidenote: Still on track for 185 by Friday.

    0
    March 30, 2022
  11. Greg Lippert said:
    Our politicians have their heads up their ass and are wrong on just about every issue.

    Conservatives mount campaigns against right to chose, Race Theory, Books in school, LGBTG and conspiracy. (See Gruber post about Nebraska politician worried about kids identifying as cats OMG – spoiler not true)

    Current admin working hard to destroy the greatest US companies the WORLD has ever seen! Who benefits? Not the consumer. And Europe is walking hand-in-hand!

    It’s bass-akwards!

    1
    March 30, 2022

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