Opinion | What Years of Emails and Texts Reveal About Your Friendly Tech Companies – By Tim Wu – The New York Times

By Tim Wu

Mr. Wu is the author of “The Curse of Bigness: Antitrust in the New Gilded Age.”

• Aug. 4, 2020, 5:00 a.m. ET
• • 162

Credit…Denis Charlet/Agence France-Presse — Getty Images

“The spectacle of the chief executives of Amazon, Apple, Facebook and Google testifying before Congress last week made for good TV drama. Yet the theatrics of the showdown distracted from the real payoff of the hearings: the accompanying cache of subpoenaed emails and texts from the past decade and a half. These documents provide compelling evidence — long rumored but seldom established — that the companies, especially Facebook and Amazon, in their rise to dominance did not always play by the rules and apparently violated antitrust laws.

Both public opinion and American law distinguish between two kinds of dominant company. The first is the monopoly fairly held: a corporation like Ford Motor that achieves dominance by virtue of its incomparable greatness. The second, its evil doppelgänger, is the company that achieves dominance unfairly — for instance, by suffocating or absorbing would-be challengers.

The Big Tech companies insist that their rise to power has been the first story, a saga of ingenuity and courage, and that their market dominance is a byproduct of continued excellence. They may be giants, the story goes, but they are friendly giants. Their immense size and power is simply what is necessary to offer users the best possible services.

The subpoenaed documents destroy that narrative. No one can deny that these are well-run companies, loaded with talent, and that each at some point offered something great. But it appears that without illegal maneuvers — without, above all, the anticompetitive buying of potential rivals — there might be no Big Tech, but rather a much wider array of smaller, better, more specialized tech companies.”

Editorial | How to Hold Big Tech’s Feet to the Fire – The New York Times

Here are some questions subcommittee members ought to consider:

Amazon

The subcommittee will probably focus on the company’s relationship with third-party merchants that use the site to sell directly to consumers. Such merchants represent about 60 percent of Amazon’s sales. The company also operates an enormous shipping network, an advertising sales business and a cloud computing service that may raise alarms among regulators. Amazon’s trove of sales data gives it incredibly detailed insights into both customers and merchants.

• After an investigation by German regulators, Amazon vowed last year to overhaul its contracts with third-party merchants. Did the company adequately do so? Does Amazon have contracts that require lower prices than other retailers’? Does it require exclusivity, meaning merchants cannot offer their goods on other sellers’ websites?

• An Amazon lawyer told the panel, “We don’t use individual seller data directly to compete” with other businesses on Amazon’s site. But a Wall Street Journal report showed evidence that Amazon does just that, helping it create tailored private-label products that undercut competitors. What is the extent of Amazon’s use of seller data?

• Amazon offers its sellers warehousing and shipping services worldwide. What does it seek in return, beyond a commission? Does Amazon use sales data from small merchants to source new products or to help larger sellers succeed, forcing out smaller ones?

• In 2010, Amazon dropped diaper prices well below profitability, in a successful effort to force a competitor, Diapers.com, into acquisition talks. Amazon has since shuttered that site. Does Amazon view such actions as exclusionary? And is the company engaged in other such pricing wars in order to force a competitor to sell?

• A Washington Post investigation showed that Amazon pushes consumers toward its private-label products even when they appear to want to buy name brands. Does Amazon favor its own products in consumers’ searches? Does it require fees or advertising purchases from merchants or brands to ensure their products rise to the top of searches?

Apple

While Apple is best known for its iPhones and laptops, it also has healthy competition from companies like Samsung and Lenovo in hardware sales. As a result, Mr. Cook is most likely to be asked about the structure of Apple’s App Store, where millions of software developers offer their apps for download.

• Why does Apple permit only its own app store on iPhones?

• Developers are generally required to offer their in-app purchases and paid subscriptions through Apple’s App Store, rather than on their own websites, where they may avoid Apple’s commissions. Apple has threatened to remove apps that don’t abide. How is this in the best interest of consumers and app developers?

• Some app developers have alleged that Apple uses the detailed data it collects about app downloads to copy their ideas and that the company favors its own apps in searches. Is this true? If so, how does the company defend such practices?

Facebook

Facebook’s aggressive acquisition strategy — including the giants Instagram and WhatsApp — makes it vulnerable to a breakup if regulators find that it was trying to rid the market of real competition.

• Reportedly, the Federal Trade Commission had documents demonstrating Facebook acquired Instagram in 2012 in an explicit bid to stifle a competitor. Were those documents mischaracterized? How did Facebook’s buying Instagram benefit consumers, and how did it determine the $1 billion price?

• British lawmakers released emails showing Facebook used an analytics app to collect detailed data about competitors in order to snuff them out. That helped Facebook decide to buy WhatsApp for $19 billion, the emails show. Couldn’t that be called an abuse of market power? Does Facebook still cull proprietary data on rivals in order to protect its market leadership?

• Advertisers can target customers on Facebook with incredible accuracy, in part because of the platform’s ability to track users’ internet browsing activity across the web. Shouldn’t users consider those terms onerous? Also, has Facebook made assurances about the privacy of customer data that it later reneged on? What assurances do consumers have that their data will remain private and not be repurposed for Facebook’s benefit?

• According to The Wall Street Journal, Facebook quashed efforts to make its site less politically divisive because partisan content drives more use of the site, which is beneficial to its advertising business. How can suppressing opposing views for users be viewed as anything but an abuse of power?

Opinion | The Neoliberal Looting of America – By Mehrsa Baradaran – The New York Times

By Mehrsa Baradaran

Ms. Baradaran is the author of “The Color of Money: Black Banks and the Racial Wealth Gap.”

• July 2, 2020

Credit…George Etheredge for The New York Times

““It’s hard to separate what’s good for the United States and what’s good for Bank of America,” said its former chief executive, Ken Lewis, in 2009. That was hardly true at the time, but the current crisis has revealed that the health of the finance industry and stock market are completely disconnected from the actual financial health of the American people. As inequality, unemployment and evictions climb, the Dow Jones surges right alongside them — one line compounding suffering, the other compounding returns for investors.

One reason is that an ideological coup quietly transformed our society over the last 50 years, raising the fortunes of the financial economy — and its agents like private equity firms — at the expense of the real economy experienced by most Americans.

The roots of this intellectual takeover can be traced to a backlash against socialism in Cold War Europe. Austrian School economist Friedrich A. Hayek was perhaps the most influential leader of that movement, decrying governments who chased “the mirage of social justice.” Only free markets can allocate resources fairly and reward individuals based on what they deserve, reasoned Hayek. The ideology — known as neoliberalism — was especially potent because it disguised itself as a neutral statement of economics rather than just another theory. Only unfettered markets, the theory argued, could ensure justice and freedom because only the profit motive could dispassionately pick winners and losers based on their contribution to the economy.

Neoliberalism leapt from economics departments into American politics in the 1960s, where it fused with conservative anti-communist ideas and then quickly spread throughout universities, law schools, legislatures and courts. By the 1980s, neoliberalism was triumphant in policy, leading to tax cuts, deregulation and privatization of public functions including schools, pensions and infrastructure. The governing logic held that corporations could do just about everything better than the government could. The result, as President Ronald Reagan said, was to unleash “the magic of the marketplace.” “

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Opinion | The Life and Death of the Local Hardware Store – by Tim Wu – The New York Times

“On Ninth Avenue in Manhattan, not far from where I live, there’s a small neighborhood hardware store called Chelsea Convenience Hardware, which is distinguished by its unlikely display of dozens of Russian nesting dolls in the storefront window. Inside, tools and supplies are piled to the ceiling, and when you enter, the owner, Naum Feygin, an immigrant from Boris Yeltsin’s Russia, looks up to ask you what you need.

The “convenience” in the store’s name is no misnomer, for the place is extraordinarily efficient. It is cheaper and faster than ordering from Amazon and offers expert advice that reduces the risk of buying the wrong thing. It is all too easy on Amazon, for example, to buy halogen bulbs that don’t fit your lamp base; Mr. Feygin has spared me many such headaches. And the store’s small size is a virtue: Unlike at Home Depot, you can be in and out in 10 minutes.

Nonetheless, Chelsea Convenience is set to close at the end of November, another casualty of rising commercial rents and competition from e-commerce. The closing is of no great economic significance, other than to Mr. Feygin. But it is a microcosm of the forces reshaping the United States economy, often paradoxically and for the worse. Why is a less efficient, less personalized and more wasteful way of buying screws and plungers — ordering online — displacing the local hardware store?”

Opinion | It’s Time to Break Up Facebook – by Chris Hughes – The New York Times

“Over a decade later, Facebook has earned the prize of domination. It is worth half a trillion dollars and commands, by my estimate,more than 80 percent of the world’s social networking revenue. It is a powerful monopoly, eclipsing all of its rivals and erasing competition from the social networking category. This explains why, even during the annus horribilis of 2018, Facebook’s earnings per share increased by an astounding 40 percent compared with the year before. (I liquidated my Facebook shares in 2012, and I don’t invest directly in any social media companies.)”

Opinion | The Roots of Big Tech Run Disturbingly Deep – The New York Times

” “Big tech” companies like Google and Facebook are, in reality, the products of hundreds of mergers. Each root below represents a company acquired by a tech giant at a particular moment in its history. A vast majority of these acquisitions, funded by public markets, have received minimal media coverage and limited regulatory scrutiny. But that is changing, given new concerns about consolidation in the tech industries.

Google
(Alphabet)270 Total Acquisitions171 Competitive 55 Conglomerate 44 Others

David Lindsay:  Yes, yes, yes. We should break up Amazon, Facebook, Google, and California.

Seriously, Amazon should be forced to sell every company it forced to sell to itself, like Diapers.com, as reported in Bloomberg Businessweek.

It appears that the other two giants are also guilty of throwing their weight around.

BUARLH!   Break Up And Regulate Like Hell!

Opinion | It’s Time to Break Up Facebook – By Chris Hughes – co-founder of Facebook – The New York Times

By Chris Hughes
Mr. Hughes, a co-founder of Facebook, is a co-chairman of the Economic Security Project and a senior adviser at the Roosevelt Institute.
May 9, 2019, 14
“The last time I saw Mark Zuckerberg was in the summer of 2017, several months before the Cambridge Analytica scandal broke. We met at Facebook’s Menlo Park, Calif., office and drove to his house, in a quiet, leafy neighborhood. We spent an hour or two together while his toddler daughter cruised around. We talked politics mostly, a little about Facebook, a bit about our families. When the shadows grew long, I had to head out. I hugged his wife, Priscilla, and said goodbye to Mark.

Since then, Mark’s personal reputation and the reputation of Facebook have taken a nose-dive. The company’s mistakes — the sloppy privacy practices that dropped tens of millions of users’ data into a political consulting firm’s lap; the slow response to Russian agents, violent rhetoric and fake news; and the unbounded drive to capture ever more of our time and attention — dominate the headlines. It’s been 15 years since I co-founded Facebook at Harvard, and I haven’t worked at the company in a decade. But I feel a sense of anger and responsibility.

Mark is still the same person I watched hug his parents as they left our dorm’s common room at the beginning of our sophomore year. He is the same person who procrastinated studying for tests, fell in love with his future wife while in line for the bathroom at a party and slept on a mattress on the floor in a small apartment years after he could have afforded much more. In other words, he’s human. But it’s his very humanity that makes his unchecked power so problematic.

Mark’s influence is staggering, far beyond that of anyone else in the private sector or in government. He controls three core communications platforms — Facebook, Instagram and WhatsApp — that billions of people use every day. Facebook’s board works more like an advisory committee than an overseer, because Mark controls around 60 percent of voting shares. Mark alone can decide how to configure Facebook’s algorithms to determine what people see in their News Feeds, what privacy settings they can use and even which messages get delivered. He sets the rules for how to distinguish violent and incendiary speech from the merely offensive, and he can choose to shut down a competitor by acquiring, blocking or copying it.

David Lindsay Jr.

Hamden, CT | NYT comment:

Bravo Chris Hughes, I feel enlightened. So, Elizabeth Warren knew about this stuff when she called for the breakup of Facebook. After reading this and the top comments, I want to second this idea, and also, insist that we also breakup Amazon. Amazon went around blackmailing companies like Diapers.com. Sell out to us or be destroyed, was the way Amazon treated such new upstarts and success stories in the online market place, and they got away with it.

Some commentators insist we should all quit Facebook, but I don’t agree. I enjoy and use it way to much to share or push ideas, causes, and humor, and to follow (less often) my friends and family.

xxxxxxxx

David Lindsay Jr. is the author of “The Tay Son Rebellion, Historical Fiction of Eighteenth Century Vietnam” and blogs about the environment at TheTaySonRebellion.com and InconvenientNews.wordpress.com.

Opinion | The Case for Investigating Facebook – By David N. Cicilline- The New York Times

By David N. Cicilline
Mr. Cicilline, a member of the House of Representatives from Rhode Island, is chairman of the House Subcommittee on Antitrust, Commercial and Administrative Law.

March 19, 2019, 173
Credit Nasir Kachroo/NurPhoto, via Getty Images

“A year ago, the world learned that Facebook allowed a political consulting company called Cambridge Analytica to exploit the personal information of up to 87 million users, to obtain data that would help the company’s clients “fight a culture war” in America.

Since then, a torrent of reports has revealed that the Cambridge Analytica scandal was part of a much broader pattern of misconduct by Facebook.

It has paid teenagers to spy on their behavior, even asking users “to screenshot their Amazon order history page,” according to the website TechCrunch. The company has secretly collected highly sensitive data through the back doors of other apps, such as ovulation trackers, to target ads at users “even if no Facebook account is used to log in and if the end user isn’t a Facebook member,” The Wall Street Journal reported.

And in its pursuit of dominance, Facebook gave at least 60 device makers direct access to its users’ data. Those actions are under criminal investigation, The Times reported last week. Facebook has also engaged in campaigns to obstruct congressional oversight and to smear and discredit critics — tactics reminiscent of the big tobacco playbook.”

Elizabeth Warren Proposes Breaking Up Tech Giants Like Amazon and Facebook – The New York Times

By Astead W. Herndon
March 8, 2019, 337 c

“Senator Elizabeth Warren, the Massachusetts Democrat who is bidding to be the policy pacesetter in the Democratic presidential primary, announced another expansive idea on Friday: a regulatory plan aimed at breaking up some of America’s largest tech companies, including Amazon, Google and Facebook.

The proposal — which comes on the same day Ms. Warren will hold a rally in Long Island City, the Queens neighborhood that was to be home to a major new Amazon campus — calls for the appointment of regulators who would “unwind tech mergers that illegally undermine competition,” as well as legislation that would prohibit platforms from both offering a marketplace for commerce and participating in that marketplace.

Ms. Warren’s plan would also force the rollback of some acquisitions by technological giants, the campaign said, including Facebook’s deals for WhatsApp and Instagram, Amazon’s addition of Whole Foods, and Google’s purchase of Waze. Companies would be barred from transferring or sharing users’ data with third parties. Dual entities, such as Amazon Marketplace and AmazonBasics, would be split apart.

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“I want a government that makes sure everybody — even the biggest and most powerful companies in America — plays by the rules,” Ms. Warren said in a statement. “To do that, we need to stop this generation of big tech companies from throwing around their political power to shape the rules in their favor and throwing around their economic power to snuff out or buy up every potential competitor.” “