How Big Tech plans to defend itself at US Congress hearing

29 Jul 2020134 Views

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Ahead of Big Tech’s antitrust showdown with lawmakers in the US, we take a look at the opening statements from the CEOs of Facebook, Google, Amazon and Apple.

Later today (29 July), chief executives from four of the most powerful technology companies in the world are set to face lawmakers in the US.

For the last year, the US Congress has been conducting an antitrust probe into the tech sector, with a focus on Amazon, Apple, Google and Facebook. During today’s hearing, the leaders of these companies will face questions about potential anticompetitive behaviour and their business practices over the years.

The House Judiciary Antitrust Subcommittee has gathered at least 1.3m documents from testifying companies and conducted five public hearings. This has all led to the hearing today, which is expected to make tech industry history regardless of the outcome.

The CEOs of each of the four companies have already released their opening statements, outlining their arguments against accusations of anticompetitive behaviour. While all four statements vary in reasoning, they share one main thing in common: each of the companies is arguing that despite their size, they still face aggressive competition.

Job creation

Amazon boss Jeff Bezos, who is appearing before Congress for the first time, is set to begin his opening statement with a story about the influence his parents and grandparents had on him growing up and why he believes “Amazon’s success was anything but preordained”.

Bezos notes that Amazon might be the largest online retailer in the US, but it is a small player in the global retail market. He adds that the global retail market is “strikingly large and extraordinarily competitive”.

According to the Amazon founder, the company accounts for less than 1pc of the $25trn global retail market and less than 4pc of retail in the US. He names Shopify and Instacart as competitors in e-commerce, while highlighting that Walmart is “more than twice Amazon’s size”.

Bezos argues that Amazon’s scale enables it to achieve things that smaller companies cannot achieve, and that the company plays a significant role in job creation in the US and globally.

Competition in the smartphone market

Apple’s chief executive, Tim Cook, opens his statement with a brief tribute to congressman and civil rights leader John Lewis, who died earlier this month.

He goes on to say that Apple is a “uniquely American company” and that its success would only have been possible in the US. He argues that Apple does not have a “dominant market share” in any market where it does business, and that the smartphone market in particular is “fiercely competitive” with companies like Samsung, LG and Huawei building successful smartphones offering different approaches to the iPhone.

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The Apple CEO touches on the topic of the App Store, which has been dragged into antitrust discussions already for its practices. Cook insists its policies ensure that customers “can feel confident that the selection is high-quality, reliable and current”.

Like Bezos, Cook focuses on job creation. He claims that more than 1.9m jobs in the US are attributable to the App Store ecosystem, from app companies to independent developers.

Facebook’s American values

Facebook boss Mark Zuckerberg jumps straight in by stating that his social media platforms face “intense competition globally”. Like Cook, Zuckerberg turns to patriotism to make his case, stating that he is “proud to stand for American values” through his platforms for sharing ideas, debating and giving users a voice.

Zuckerberg does not name any specific company that Facebook is feeling “intense competition” from, but he does take aim at the Chinese tech industry. He warns that there’s “no guarantee” the ideals of Facebook will “win out” against China’s “own version of the internet” that is being built.

Similarly to Cook and Bezos, Zuckerberg argues that Facebook plays an important role in job creation, as the platform allows small businesses to connect with customers and provides entrepreneurs with “sophisticated tools” that enable them to reach more potential customers.

Responding to criticism of major acquisition deals with Instagram and WhatsApp, Zuckerberg claims that those services have improved under Facebook’s ownership and guidance.

A departure from search engines?

Sundar Pichai, CEO of Alphabet and Google, goes down the same route as Bezos – offering a personal story about his upbringing and experience moving from India to the US. Pichai says that accessing the internet for the first time in a US computer lab during graduate school inspired him to bring technology to as many people as possible.

The main arguments in Pichai’s opening statement are that Google’s ad business has seen an “enormous” amount of competition in recent years, now that just about anybody can advertise with Facebook, Twitter, Instagram, Pinterest and Comcast. As a result of the wider choice of advertising platforms, Pichai says that advertising costs have lowered by 40pc over the last decade.

He adds that he sees competition as a positive thing as it sets “higher standards for privacy and security”, noting that privacy is a “universal right” that should be available to everyone.

When it comes to Google’s search engine, Pichai argues that the firm is now facing more rivals than ever. He lists competitors in this space as Amazon Alexa, Twitter, WhatsApp, Snapchat and Pinterest – despite the fact that none of these businesses are considered to be search engines.

Pichai’s argument here is that these are the platforms people visit when they want to find information, and that more people are going beyond search engines to find information they need.

Kelly Earley is a journalist with Siliconrepublic.com

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