Tech companies take aim at Klobuchar antitrust bill 

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WASHINGTON – Sen. Amy Klobuchar has been locked in a pitched fight with tech giants like Google and Amazon. They have used their own platforms as well as newspaper op eds and television ads to try and defeat one of the Minnesota Democrat’s legislative priorities.

Klobuchar has remained true to her legislative principles in her campaign to end some of the anticompetitive practices of big tech. Klobuchar prefers bipartisan support when possible, so she has enlisted Senator Charles Grassley (R-Iowa) as an ally.

Klobuchar also thoroughly researched the topic – she explored the anticompetitive practices in Big Tech in her book “Antitrust: Taking On Monopoly Power From the Gilded Age To the Digital Age”. She also relied on a detailed report from the House Judiciary Anti-Trust Subcommittee. This was the result of an extensive investigation, which included testimony from Amazon chief Jeff Bezos, and other tech giants.

Klobuchar has been a long-standing advocate for tightening online privacy laws to protect children from predators and other threats on the internet. The tech bill that could have the greatest impact and be her crown jewel in her Senate career is American Innovation and Choice Online Act . This bill has been hammered by intense lobbying.

Platforms like Amazon and Google would be prohibited from giving preference to their services by the legislation. It would also ban platforms from using non-public data of platform users to create copycat products and make businesses purchase other services in order to get good search rankings on their platforms.

Klobuchar’s bill would also grant the Justice Department, Federal Trade Commission, and state attorneys general the authority to prevent violations and prosecute violators.

Klobuchar stated that American prosperity was built upon open markets and fair competition. However, right now, the country is facing a monopoly problem and American consumers, workers and businesses are paying the price.

Klobuchar stated that her American Innovation and Choice Online Act was “the first bill for tech competition to make it to the Senate floor.” She also stated that her legislation will “put common-sense rules of the road in place to lower consumer costs and help small businesses compete.”

The legislation was accompanied by a companion bill that was sponsored by Rep. David Cicilline (D-R.I.). Both the House Judiciary Committees and the Senate Judiciary Committees voted it out in a bipartisan fashion. The legislation has been endorsed by the Justice Department, which indicates that President Joe Biden supports it.

Klobuchar also modified her bill in an effort to calm some of her coworkers’ fears.

Klobuchar’s bill has been opposed by tech giants for many months. The Wall Street Journal reports that groups representing tech giants have invested more than $36million in television and digital ads compared to $193,000 by those who supported antitrust legislation.

According to Senate lobbying disclosure reports, Amazon and Meta, the umbrella company for Instagram, Facebook, etc., were among the top 10 U.S. companies when it came to spending money on lobbying. The top 10 U.S. corporations that spent money on lobbying during the first quarter of 2018 were – Amazon spent $5.3 Million and Meta $5.4 Million, which is a significant increase in their lobbying budget for the first three months 2021.

Meta, Google, and Amazon did not respond to requests for comments on this story.

Amazon Prime is over?

NetChoice is a group that claims its mission is “make the internet safe” and that the federal government should have a “light touch” when regulating tech companies. It is one of the groups that has run digital and television ads this year against Klobuchar’s bills, which targeted key senators.

Carl Szabo, NetChoice Vice President, stated that “we want to make constituents aware what their legislators are doing.”

Klobuchar’s bill, he said, would “increase prices, decrease choice, and break many features Americans have.”

He said that the legislation would eliminate the alerts his sons, aged 9 and 6, receive when they try to purchase something online.

Szabo believes that the bill’s worst feature is its exclusion of certain companies. The bill covers publicly traded companies with 50 million monthly active U.S. users or more and net annual sales greater than $550 billion in the last two years. This would include Amazon, Apple and Meta, as well as Google.

Szabo stated that the latest bill includes private companies with 50 million monthly U.S. users, and 1 billion worldwide active users. This was to capture TikTok.

Szabo stated that the bill was written in a “capricious fashion” to unfairly single out certain companies.

Szabo stated that Klobuchar has made this a personal project. She did not want to help consumers but she wanted to help the companies she liked.

The Chamber of Progress, an American trade organization that represents technology companies and is a trade group, has called Klobuchar’s legislation “politically toxic.” It counts Amazon as one of its “partners” along with Apple, Google, Meta, and Google.

One release stated that the legislation “would negatively impact tech products with Amazon acknowledging that Amazon Prime will be’significantly reduced,'” according to one of the organization’s releases. “Concerns over the bill have caused divisions within the Democratic Party.”

According to the chamber, Klobuchar’s bill would require Amazon to treat all sellers equally and end its “Prime” service.

Adam Kovacevich, CEO of Chamber of Progress, stated that “Breaking Amazon Prime in an election year would have an even greater political disaster for Democrats than rising Inflation.”

Klobuchar supporters dispute this claim.

Sacha Haworth, executive Director of Tech Oversight Project, stated that “it’s complete BS.” “There is nothing in this bill to do that.”

Haworth stated that third-party sellers feel obliged to pay Amazon for the “Prime label.” They then send their products directly to Amazon. Amazon sells and ships the products to customers.

Haworth stated that “that’s not necessarily a best or cheapest method to get a book delivered to you.” “Big tech monopolies are abusing their market share for too long,” Haworth said.

Haworth said that small businesses can be effectively bankrupted.

Klobuchar’s bill was also attacked by opponents who argued that big tech is unable to moderate content when their platforms are open to all users.

Sumit Sharma is a Senior Researcher at Consumer Reports. He also supports the American Innovation and Choice Online Act.

Sharma stated that the bill is focused on competition and not content moderation and will not lead to more dangerous content being posted on the internet.

Sharma agreed with Klobuchar’s supporters and said that there should be greater federal oversight of the tech sector.

He said, “You feel that they make their own rules.”

However, Klobuchar was still contacted by four Democratic senators led by Sen. Brian Schatz (D-Hawaii), about concerns her legislation might raise regarding content moderation.

The senators stated that “Limiting the ability of the largest technology companies to leverage their gatekeeper status through anticompetitive means is a worthy goal, which we support.” The bill could also be used to hinder content moderation practices such as the application community guidelines and policies that are used to combat misinformation and remove hate speech.

Wired responded to the senators’ concerns.

Wired published an article on the senators’ letter stating that “Here is the bill’s content moderation clause: Nothing.” The relevant section states that a covered platform – such as Google, Amazon and Meta – can’t ‘discriminate’ in the application of the terms of services of the covered platform among similar situated business users in an manner that would materially hurt competition. This doesn’t appear to prohibit or limit content policies. This suggests that platforms can still enforce their terms and conditions , but not in a discriminatory manner.

Klobuchar would require 60 votes to overcome any filibuster, and get her bill approved in the Senate. She and allies are certain she has the votes, despite her lobbying war. The Senate calendar, which is compressed by the need for many senators campaigning in the election year, may prove to be a greater obstacle.

Szabo from NetChoice stated that, as legislators become more aware of its impact, momentum for the bill has “come crashing to a halt.”

Klobuchar remains optimistic.

The senator stated that despite all the lobbyists and lawyers fighting the bill and all the millions spent on airwaves against us, the American people are on our side. He also said that the momentum was growing to pass commonsense legislation.

Haworth, of the Technology Oversight Project, stated that Klobuchar’s attempt to get approval for his bill was “truly a David-vs.-Goliath battle.”

Haworth stated that tech companies don’t have the support of the public. They do have money. We have grit.

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