Klobuchar, Grassley to File Bill Barring Tech Self-Preferencing
Legislation unveiled Thursday would prohibit online platforms from self-preferencing their own products. Modeled after bipartisan legislation in the House, the American Innovation and Choice Online Act will be introduced by Senate Antitrust Subcommittee Chair Amy Klobuchar, D-Minn., and Senate Judiciary Committee ranking member Chuck Grassley, R-Iowa.
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Sponsors include Senate Judiciary Committee Chairman Dick Durbin, D-Ill.; Lindsey Graham, R-S.C.; Richard Blumenthal, D-Conn.; John Kennedy, R-La.; Cory Booker, D-N.J.; Cynthia Lummis, R-Wyo.; Josh Hawley, R-Mo.; Senate Intelligence Committee Chairman Mark Warner, D-Va.; and Mazie Hirono, D-Hawaii.
The bill is similar to HR-3816 (see 2106110070) from House Antitrust Subcommittee Chairman David Cicilline, D-R.I., and ranking member Ken Buck, R-Colo., said a Grassley aide. The House Judiciary Committee passed its bill in June (see 2106240071), but sponsors say the antitrust package isn’t ready for the floor (see 2109280067).
The legislation “will establish new rules of the road to prevent large companies from boxing out their smaller competitors,” Klobuchar tweeted. “Big Tech has a track record of unfairly limiting consumer choices and thwarting free-market competition,” Kennedy told us: The bill “would help offer consumers more options at competitive prices, which is what the American economy is supposed to do best.”
Absent any “meaningful regulations,” Big Tech platforms are using data they collect from companies on their platforms to create “unfair advantages for themselves,” Lummis said in a statement: The bill “would level the playing field and make sure that consumers and merchants in Wyoming have fair access to the marketplace.”
Nondiscrimination protections in the bill are “crucial for breaking down the power of Big Tech,” said Public Knowledge Competition Policy Director Charlotte Slaiman: PK wants to “cut down on the additional hoops enforcers have to jump through to bring a case against Big Tech discrimination” so competition will have a chance. Consumer Reports backed the proposal, noting its “specific non-discrimination requirements which would allow for greater interoperability, restrict how the largest platforms are able to use non-public data, and allow users to change default options and uninstall software.”
“My general read on the House bill is that it might help [competition], depending on how judges interpret it,” said American Economic Liberties Project Research Director Matt Stoller.
The legislation would “distort competition and undermine innovation,” said the Information Technology and Innovation Foundation. U.S. lawmakers are taking cues from EU policymakers, who don’t have U.S. economic interests in mind, and from the EU’s Digital Markets Act, said ITIF Schumpeter Project on Competition Policy Director Aurelien Portuese: “Self-preferencing usually fosters competition rather than undermining it.”
“Proposals to hamstring leading digital services by putting regulators in charge of technological advances risks ceding the U.S. leadership position to foreign rivals,” said Computer & Communications Industry Association President Matt Schruers. “Markets, not ministries, should shape the future of U.S. innovation.”
“It is ironic that Congress is considering adopting such a European-style regulatory approach, which has prevented European businesses from innovating effectively and stymied Europe’s efforts to become a tech leader,” said ex-FTC General Counsel Alden Abbott, now a researcher at George Mason University.