Daily Management Review

US Congressional Report On How The Largest Tech Firms Dominate Markets


US Congressional Report On How The Largest Tech Firms Dominate Markets
A report that details strategies and tactics that the four largest United States based tech giants use for gaining a dominant market position in areas of  online search, advertising, social networking shopping and other businesses areas was issued by Democrats from a US House of Representatives subcommittee.
With respect to Amazon, the report noted that the company used a single platform to sell goods from independent merchants as well as those its own products. Amazon has "monopoly power" over many of these merchants and these merchants "do not have a viable alternative to Amazon for reaching online consumers", alleged the Congressional report. This results in a "conflict of interest" in which Amazon owns he incentive to use data of competing companies selling products on its platform and use it to its advantage for selling its own goods and services, the report alleged.
The report suggested preventing Amazon from competing with those merchants that are dependent on the e-commerce giant’s infrastructure.
In the case of Apple, the report noted Apple enjoying a monopoly over distribution of software for iPhones. This power is used by the iPhone maker to charge higher than market prices form app developers – I the form of a 30% commission for such developers using its App Store. Apple also has the power to exclude rival apps and services and use data from developers to create competing services and features.
The report proposes to prevent Apple from competing in markets and business segments where its competitors have to depend on its App Store to reach out to consumer s- n this case iPhone owners. The suggestions also include reducing Apple’s ability to remove competing apps from its App Store by creating rules against self-preference.  
For Facebook, the Congressional report noted the company’s monopoly in the business of “social networking” which was distinguished from those social media industry segments that are much more centered around content such as YouTube and TikTok. The report said that by identifying nascent rivals and copying, acquiring or killing them even before they could develop into any credible competition, Facebook ensured its dominance on the social networking market. The report identified acquisition of Instagram and WhatsApp as the two examples of such a predictive business strategy of the largest social media company of the world.
While not directly suggesting a break up of Facebook, the report suggested boosting budgets of antitrust regulators and giving them more powers to stop acquisition of potential future rivals.
The report alleged that the search engine giant Google ensures that its own services are favored over those of competitors in search, phone and tablet software, advertising technology and mapping technology by using restrictive customer and partner contracts and other means.
The Congressional report urged the Congress to pass nondiscrimination and bargaining laws that would force large service providers such as Google to provide fair access to their systems. Such regulations would also be beneficial for device makers ad tech companies and app developers that aim to shift from Google tools.
No comments on the report were available from Amazon, Apple, Facebook and Google.