Why do heads of major technology companies testify before Congress?


After the session is postponed for two days, the chief executives of the largest technology companies, Facebook, Amazon, Apple and Google, will testify before the US Congress for the first time ever. Well, they will not go by themselves to the Capitol because of the ongoing conditions of the epidemic, but they will appear online via video. You can watch the live broadcast of the session .

However, the event could be historic, with Amazon founder Jeff Bezos first appearing in a hearing before Congress, while the other three, Mark Zuckerberg, Sundar Pichay and Tim Cooke, had already made appearances in congressional hearings.

But what is the goal behind listening to the heads of the most powerful current technology companies? The answer may lie in the same question, simply because there is an investigation by the Antitrust Subcommittee on the extent of the power that these companies use to harm competition and control the market and monopolize it in their favor. And whether the four big companies, and each of them is one of the most valuable companies in history, has built its current economic power, or is using it, in ways that harm competition in the technology markets in general.

Facebook .. Fatal acquisitions of competitors!

Not only is Facebook the largest social network in the world today, but it also owns two of the other largest social networks, namely Instagram and WhatsApp, each with more than a billion users. These two companies are just two of the more than 80 companies that Facebook has acquired in recent years.

There is one lesser-known name you can expect to hear is Onavo, a startup of mobile phone usage analytics that Facebook bought in 2013, and whose data on other apps is allegedly used to identify companies nominated for the acquisition or even mimic its service by Facebook, is said to be one of the acquisitions due to Onavo data was the acquisition of WhatsApp instant messaging.

It is well known in the business world and in the field of technology that all major companies and platforms have taken over small companies, emerging in the dozens or even hundreds. But there is what is known as “lethal acquisitions,” which absorbs the potential competitor to your service before it grows into an enormous competitor and takes your market share, which is a major impediment to entrepreneurship and innovation today.

And here comes the specialty of Facebook in lethal acquisitions, everyone knows what is happening, which is that once a competitor appears in the social media market trying to prevent him and buy it directly or even imitate his services as happened with the Snapchat application.

The concrete question that Congress can ask is whether the laws around these acquisitions, especially acquisitions against emerging competitors, need more tightening and oversight?

Google Inc. .. the dominant leader in the digital advertising market!

Since Google has a dominant position in many different areas within the Internet economy, the case against it may be the strongest and most difficult to interpret. Google is the currently dominant player not only in the search engines, but also in the digital advertising market, as well as Android mobile operating systems, along with GPS and navigation, in addition to email and video sharing, it is almost easier to mention parts of the infrastructure For the Internet, in which Google does not play a big role.

Like Facebook, Google built this hegemony through a massive set of acquisitions, such as the YouTube video platform and the Android operating system. But he will address the interrogation in Congress, which turned Google’s word into action. In its early days, using a Google search engine usually meant searching for something and then clicking on a link that would take you to another website.

But companies and competitors increasingly complain that the company designed its own search engine in ways that benefit Google at their expense, and today ads dominate the top of search results in an unprecedented manner, which puts more pressure on those companies to pay more to appear to the user.

At the same time, the free results seem to prefer the properties of Google itself, so YouTube appears instead of Vimeo for example, and so on. The answer box, which pulls information from other websites, keeps users on a Google page, rather than clicking on the website link, which in turn means more opportunities to click on ads.

Speaking of ads, Google’s share of digital advertising, a sector that it dominates along with Facebook, goes far beyond ads on the search network. According to a comprehensive investigation by the UK Competition and Markets Authority, Google owns up to 90% of the share of multiple parts of the digital advertising market, including the tools that publishers and small businesses use every time they buy and sell ads. It is striking that, with the annual spending on digital advertising growing to hundreds of billions of dollars, this sector is almost completely disorganized, and Google plays the dominant leader.

Amazon … bad deals on the most popular e-commerce platform!

A good portion of the momentum behind the antitrust campaign of major tech companies comes thanks to a widely read research paper published by a law student named Lina Khan titled “Amazon’s Antitrust Paradox.” Which was discussing the policies of the electronic market company Amazon.

Jeff Bezos will have some clarifications on Amazon’s pricing strategies. But since customers love Amazon’s low prices, it may be difficult to win that particular battle in court before public opinion. But Amazon is more at risk when it comes to how it deals with other companies working on its platform.

Since it runs the largest online marketplace and participates in this market, and because it has access to unprecedented amounts of buyers and sellers data, questions have for years been revolving around Amazon’s incentives to pressure unfairly extracting money from brands and other sellers.

Most merchants are unable to be absent from the Amazon e-commerce platform, and this means that they are forced to accept any deal offered by Amazon. In recent years, an increasing number of companies have complained that these deals were bad. Independent merchants complained that Amazon was forcing them to sell at low prices, allowing counterfeiters to escape, and even weakening sellers by imitating their designs with Amazon branded products.

Last April, the Wall Street Journal report stated that Amazon was using data from external vendors to develop its own products, despite the company’s insistence that it did so. During the revolution over this report, Congress called billionaire Jeff Bezos to testify for the first time.

Apple Inc .. 30% unfair commission!

The case against Apple may be the easiest to explain, and it will revolve around the company’s policies in the App Store, as application developers have complained that Apple’s 30% commission on all revenue from its app store is unfair. They also accused Apple of discriminating and discriminating against applications that directly compete with services provided by the company.

The CEO of Tile, which makes hardware and software to help people track things like their keys and wallet, had testified that Apple had changed Find My iPhone to mimic the Tile app, and then decided to stop selling Tile products at its store.

IPhone accounts for between 40% and 50% of the mobile phone market in the United States. Just like the case of online merchants and Amazon, app developers being blocked from accessing the App Store face a threat from Apple. The last problem was because Apple rejected the updated version of the new email app Hey from its app store.

In anticipation of this attack, Apple released a study last week indicating that its 30% commission is a normal commission, and can be compared to what competitors in other digital markets such as Google and Amazon are imposing on applications on their devices.

This may be answered by members of the Antitrust Subcommittee that for this reason they invited Google and Amazon also to the same session!

Note: the content of this news was written by Arab Hardware And does not express a point of view Egypt today But it was transferred with its content as it is from Arab Hardware We are not responsible for the content of the news and custody of the previous source.


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