As CES Closes, Experts Debate Whether to Break Up Big Tech

Antitrust doctrine historically focused on conduct and structure, said Robert Atkinson, president of the Information Technology and Innovation Foundation. “We should be focusing on conduct,” he said Thursday. “FTC, DOJ, other authorities should be looking very religiously at the behavior and the conduct of big technology companies to make sure they don’t use their market power in ways that are anticompetitive.”

“That big tech companies are big is not a problem in itself; in fact, it’s a benefit,” Atkinson said. The top companies in the world for R&D spending are Google parent Alphabet and Amazon, he said. Size lets these companies make big investments in “the future,” he said: “If we try to break them up, we’re going to lose that.”

Charlotte Slaiman, Public Knowledge senior policy counsel, responded she's “very concerned” about the “power” of big tech companies. “Network effects very well may be a big part of the reason that these companies are so powerful,” she said. Antitrust law probably won’t address concerns, she said. “These companies are too powerful, and we need other solutions.”

Experts in the U.S., Europe and “more and more countries” agree today’s dominant network platforms occupy a unique position, Slaiman said. “Part of this is because of network effects, part of this is because of the incredible increases in the value of data as it is aggregated.” Consumer behavior also makes the companies powerful, she said: “We are not always searching around for the next product, we tend to stick with what we know.” It's time to "fix this market and come up with some new laws and rules" to promote competition, Slaiman said.

The left isn't unique in railing against big tech, said Zach Graves, head of policy at Lincoln Network. Conservative pundit Tucker Carlson also weighed in, Graves said: “It has become very trendy to hate on some of the big tech companies.”

What’s missing is “any agreement on what the underlying grievances are with big tech,” Graves said. The big players “provide tremendous value to consumers that consumers are very happy with.” Conservatives have unique concerns, Graves said. “There’s really a lot of concern about speech-related issues more than concentration of power issues,” he said. “I don’t really see how this remedy of breaking up big tech addresses that.”

Antitrust is designed to address “a specific kind of behavior,” said Jennifer Huddleston, research fellow at the Mercatus Center. “We’re looking at, is there anticompetitive behavior.” Often, “innovation has in itself been our best competition policy in America,” she said. A decade ago, discussion would have been “the MySpace national monopoly or how Yahoo won the search wars,” Huddleston said. New products have come along to replace companies that once looked like they had an unassailable market position, she said.

Slaiman said rules for platforms should include interoperability requirements. Also important are terms and conditions for protecting user privacy, she said. The rules should mandate nondiscrimination, she said: “When these platforms are making their recommendation algorithm decisions, we want to make sure that they are not discriminating in a form that causes competitive problems. Are they referencing their own products, putting their own services at the top of the page, or are they using a neutral criteria?”

Any takeovers should include sector-specific review by experts, rather than just be based on antitrust law, similar to how the FCC analyzes transactions, said Slaiman, a former FTC antitrust lawyer. “The power of these platforms is not just in one market, it’s about the scope of their vertical integration,” she said. “They are so powerful because they’re in so many industries.”

Atkinson said some of Slaiman’s concerns are legitimate, but DOJ or FTC have the tools to analyze deals. He said we “don’t need a separate regulator.”