Google Leads Tech Sector Lobbying Boost as Companies Push on Surveillance, Patents
The maturation of the tech sector and ongoing data security concerns continued to drive increased tech lobbying spending in Q2, as Google matched its highest quarterly lobbying total and Amazon surpassed $1 million in quarterly lobbying expenditures for the first time, according to lobbying disclosure forms. The forms revealed tech companies and trade groups are pushing for changes to government surveillance programs, email privacy standards, Internet privacy expectations, cross-border data flows and the patent system.
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Tech industry lobbying spending has risen dramatically in recent years as the sector itself has rapidly expanded -- a normal course of events, said University of North Carolina political science professor Frank Baumgartner in an interview. “I'm always surprised at how long it takes these companies to figure this out,” said Baumgartner, who has worked on numerous books and articles on the effects of lobbying spending. “It’s a very good return on investment to lobby."
Facebook nearly doubled its year-over-year quarterly spending in Q2, recording $2.12 million, but was down from its Q1 total of $2.78 million, a company high. “They're really pushing into the same sort of league that Google used to be in,” Consumer Watchdog Privacy Project Director John Simpson told us. Consumer Watchdog analyzes the top-15 tech and communications lobbying spenders each quarter (http://bit.ly/1ryZSaq). Google has topped the list both quarters this year. Through most of 2012 and 2013, Google spent in the mid-$3 million range, with the exception of Q1 in 2012, when it spent $5,030,000, according to disclosure forms. It matched that high point in Q2 this year. “Google’s sort of a player on its own level here,” Simpson said.
Simpson said Google’s 2012 spike was likely due to several ongoing FTC investigations -- one regarding electronic device competitiveness (http://1.usa.gov/1uciE9v) and another involving tracking cookies (http://1.usa.gov/19VRGcD). But reasons for the 2014 jump are less clear, he said. The company’s disclosure forms from Q2 2014 and Q2 2013 show the search engine company lobbying on mostly the same wide range of issues -- online advertising, the U.S.-EU Safe Harbor agreement, patent bills, cybersecurity, mobile location privacy. A few notable additions in Q2 2014, and in other more recent disclosure reports, are surveillance, connected education, health information technology and “advanced sensor-based technologies.”
"The surveillance issues have really made it clear to them that government can ruin their reputations very quickly,” said Baumgartner. Google’s expanding its health and education reach as well. Google recently licensed its smart lens technology to European drug maker Novartis to manufacture smart contact lenses (CD July 16 p19). In September, Google will unveil Classroom, to integrate Google Drive, Google Docs and Gmail together for teachers as part of its Google Apps for Education platform (http://bit.ly/1fwF08O). “You can’t spend that much money without going into a lot of different domains,” said Baumgartner. Google didn’t comment.
Amazon hit $1.06 million in Q2, its first time surpassing the $1 million mark, and up from $860,000 a year ago. Amazon was recently hit with an FTC lawsuit over years of allegedly unauthorized in-app purchases made by children. Amazon’s form said it was lobbying on “issues related to mobile payments and payment processing,” but said it was lobbying only Congress, the Federal Reserve and the Treasury Department on the issues. The e-commerce retailer also listed some issues on which it was lobbying the FTC -- drones, patent assertion entities, data breach notifications, data security and “issues related to online wine sales.” Amazon didn’t comment.
Apple was also up in year-over-year spending, but down from a company high in Q1 2014. Its Q2 total -- $840,000 -- was up $150,000 from last year, but down $230,000 from Q1. The company in January agreed to settle FTC allegations similar to those currently aimed at Amazon (CD Jan 16 p9). A few major tech spenders were down in Q2. Microsoft and Yahoo declined year-over-year in Q2 spending. Microsoft disclosed $2,340,000 in Q2, down from $2,960,000 last year. Yahoo showed only a slight decrease -- from $710,000 to $700,000.
Twitter has a ways to go before it reaches such levels, but it nearly doubled its lobbying spend from Q1 to Q2. After holding relatively steady at $40,000 and $50,000 in its first three quarters of filing a lobbying disclosure form, the micro-blogging company jumped to $90,000 in Q2. The eight-year-old company listed one lobbyist and targeted patent revamp efforts, surveillance program reforms and updates to the Electronic Communications Privacy Act in its disclosure form. “Nobody invented a new technology platform because they were wanting to have regular meetings with their senators,” said Baumgartner. But if companies keep growing, nearly all eventually come to “an unhappy realization that they can’t leave things to chance,” he said.
Trade Groups Hold Steady
Spending held even among major tech trade groups, and ticked up among smaller trade groups. The Software & Information Industry Association was even year-over-year at $280,000, while the Computer and Communications Industry Association was down slightly over the same time span -- from $165,000 to $160,000. The Direct Marketing Association held even at $250,000, as it has each Q2 for the three years.
Smaller groups like the Application Developers Alliance and NetChoice boosted their spending. The Alliance jumped nearly 80 percent from Q2 2013 to Q2 2014, hitting $147,000. A spokeswoman declined to comment on the increase, but the group’s form highlighted a number of patent bills -- including the recently marked up Targeting Rogue and Opaque Letters (TROL) Act (CD July 11 p14), the Protecting Student Privacy Act from Sen. Ed Markey, D-Mass., and “general telecommunication issues surrounding connected cars and navigation apps.” E-commerce trade group NetChoice has been ramping up its spending in recent quarters as the debate intensifies over whether states can levy taxes on companies not physically located in the state, which NetChoice opposes, said NetChoice Policy Council Carl Szabo. The group’s Q2 lobbying spend of $90,786 also focused on the ongoing facial recognition technology code of talks, organized by the NTIA (CD June 24 p6).
Consumer Watchdog’s Simpson said major tech companies should disclose how much they pay industry trade groups. It’s “soft lobbying,” he said. For instance, Facebook, Google and Yahoo are all NetChoice members. Hard or soft, all lobbying spending goes toward simply having a Washington presence, Baumgartner said. “Part of what companies do is simply spend money to monitor things,” he told us. “Just to pay attention, just to be sure nothing bad is happening.”