Platform Product Preference Bill Unfairly Targets Large Online Platforms, Says CCIA: Broadband Breakfast

WASHINGTON, March 24, 2022 — The bill that would prohibit large online platforms from engaging in practices such as giving their own products preferential treatment over their competitors is too narrowly defined to include a small group of big tech companies while excluding others, an association representing these big tech companies argued on Wednesday.

The U.S. Online Choice and Innovation Act, which also seeks to prohibit discrimination against third-party products on the host platform, defines companies covered by the legislation based on their value – which, according to some, will exclude other large retailers who may engage in the same practices. legislation hopes to abolish.

“Bill picks winners and losers very carefully,” Arthur Sydney, vice president of public policy for the Computer and Communications Industry Association, said Wednesday during a Broadband Breakfast panel about legislation passed by the Senate Judiciary Committee for Senate votes. The CCIA, which defends small and medium-sized businesses, also counts among its members Amazon, Google and Facebook, three of the world’s largest companies.

“I think the bill penalizes fat people for being bad, but fat…isn’t bad. It’s just a matter of success,” he said.

The legislation “prohibits certain large online platforms from engaging in specified acts, including giving preference to their own products on the platform, unfairly limiting the availability on the platform of another company’s competing products, or discriminating in the application or application of the platform conditions”. of service between users in the same situation,” according to the bill.

President of CCIA matt schruer said of the bill in January that targeting “big business will distort competition and make it worse for consumers. By crippling successful American technology companies without even imposing corresponding obligations on their foreign rivals, this short-sighted legislation will put the data and security of American users at risk.

Amazon had been accused of violating antitrust laws when it allegedly used data from third-party sellers to help boost sales of its own products. On Friday, a DC Superior Court judge dismissed the case against the company. Meanwhile, on this same issue, bipartisan members of the House Judiciary wrote to the Justice Department this month alleging that Amazon obstructed the “thorough investigation into competition in digital marketplaces.” of the committee, which took place at the last Congress.

Bill provides the flexibility to capture other businesses

But a government affairs policy adviser from advocacy group Public Knowledge, who sat across from Sidney at Wednesday’s event, said the legislation provides flexibility to capture other big companies that may engage in such practices.

“The [bill is] trying to circle, analyze and scrutinize a position in the market “instead of targeting certain companies by name,” he said. Anthony Prince Albert III. “The [bill is] flexible with thresholds to show that a position in the market would be indicative of market capitalization,” he said. Market capitalization is determined by multiplying the price of each share by the number of shares outstanding.

It “does not target individual businesses,” Albert said.

In the middle of these two points of view was Patrick Heger, Executive Director of Taxpayers Protection Alliance. He said “the market is a bit more buoyant than proponents of this legislation think”, as evidenced by the “recent collapse in the market capitalization of Meta”, whose share price fell 25 % after the company’s social media platform, Facebook, saw a decline in user growth. .

If Meta “is at this market cap for the next two years, which is what part of the bill is mandated to do, they will no longer be a hedged platform,” he said.

Hedger also raised a bill proposed by the senator Amy KlobucharD-Minnesota and Senator Tom CottonR-Arkansas, which has a data enactment provision in this bill that means “only companies that exceed market capitalization on the date the legislation is enacted will be covered in perpetuity, and not all others that will eventually reach that level.”

This bill, titled the Platform Competition and Opportunity Act, aims to “prevent big tech from further suppressing competition through lethal acquisitions” and establish “a presumption against mergers and acquisitions of potential competitors by big tech companies,” according to a pager about the bill.