Biden at his presidential kickoff rally in Philadelphia. (Wikimedia Photo / Michael Stokes)

When President Joe Biden and Vice President Kamala Harris were sworn in Wednesday, they inherited a unique opportunity to rein in the technology industry. In addition to bipartisan support for some form of Big Tech regulation, the Biden administration has the benefit of a Democrat-controlled Congress.

But Biden plans to pack as much into his first two years in office as possible, signing a flurry of executive orders on his first day in office that target the pandemic, climate change, and other objectives. With such a long list of pressing priorities, many in the technology sector are wondering whether regulation of Big Tech will fall by the wayside.

Efforts to rein in the tech industry gained momentum over the past few years, with the House of Representatives, Department of Justice, federal regulatory agencies, and several states launching inquiries into the power that companies like Amazon, Apple, Facebook, and Google wield. While ongoing lawsuits will likely continue, antitrust experts don’t expect the issue to be prioritized in the early days of the Biden administration.

“I suspect we’re going to be in a more quiet phase of antitrust prosecution of the Big Tech sector for a while now,” said John Mayo, an economics professor at Georgetown University specializing in antitrust policy and regulation. “But just the fact that it is quiet doesn’t mean that it isn’t percolating. In due course we’re going to find out where the agencies are, whether they really have the goods or not on big tech companies.”

Seattle vs. Silicon Valley

Founders’ Co-op Managing Partner Chris DeVore. (Founders Co-op Photo)

While no one knows for sure what will happen on this issue, Seattle’s tech economy could end up being more insulated from antitrust challenges than the Bay Area is, due to the lower relative risk facing the region’s tech giants, Microsoft and Amazon, said Chris DeVore, managing partner of Seattle-based seed-stage venture capital fund Founders’ Co-op, during a discussion Thursday at the virtual Cloud City Meetup.

Microsoft weathered its regulatory battle 20 years ago, and DeVore said Amazon’s customer-centric, transactional business model could put it in a more favorable position than Google and Facebook, which “make money by selling their users to other people in the form of advertising.”

“I would say that we are hedged a little bit against the biggest threat to the tech economy being an engine of growth, and San Francisco is more exposed,” DeVore said. “Maybe the jury’s out on Apple, but Google and Facebook are really in for a tough run as the government tries to reimagine what antitrust looks like in tech.”

In a follow-up message, DeVore reiterated that he doesn’t believe it’s clear how antitrust issues will play out, but said it would take changes in the government’s approach to antitrust for Microsoft and Amazon to face the kinds of challenges that Google and Facebook do today.

Georgetown University antitrust expert John Mayo. (Georgetown Photo)

Georgetown University’s Mayo expects incoming Biden administration officials to continue with lawsuits filed against big tech companies under President Donald Trump, although the scope and focus of those challenges could change.

Google faces several lawsuits claiming the company abuses its dominance in search and advertising, including cases brought by the Justice Department and dozens of states.

The Federal Trade Commission and 40 state attorneys general are suing Facebook over allegedly anticompetitive acquisitions. Separately, the DOJ filed a lawsuit in December claiming Facebook favored immigrant workers over domestic talent.

It appears Amazon and Apple have escaped similar lawsuits so far, but they are under Congress’ microscope.

The House Judiciary Committee released a report last fall accusing Apple, Facebook, Google and Amazon of abusing their market power to benefit themselves. The report zeroed in on Amazon in particular, mentioning the company by name 1,866 times, almost twice as many times as Facebook, and second only to Google at 1,964 mentions. The report followed a hearing over the summer in which lawmakers grilled the CEOs of each company.

In a sign of bipartisan support for regulation, 17 Republican House lawmakers sent a letter to Biden this week pledging to work together to “enforce our antitrust laws against emboldened technology monopolies.”

WTIA CEO Michael Schutzler. (WTIA Photo)

Though the House Judiciary report recommends updating antitrust law for the digital age, it isn’t clear whether Congress will take up the mantle of tech oversight anytime soon.

“Antitrust was designed as a consumer protection and the issues that are being challenged … are not harm to consumers in the antitrust definition, but more a question about how businesses resolve a power asymmetry,” said Michael Schutzler, CEO of the Washington Technology Industry Association, a trade group representing Microsoft, Amazon, and others. “Until the antitrust laws are rewritten, it doesn’t apply. I think there’s so much complexity in that, that as a practical matter, it’s not going to be done soon.”

Schutzler thinks the chances of a federal data privacy law crossing the finish line are more likely, particularly as more states consider their own regulations. California passed a sweeping law regulating how companies deal in consumer data in 2018 and Washington state is considering similar legislation this session.

Shifting priorities

If and when federal regulators do turn their attention to antitrust enforcement, experts expect them to take a different tack than the previous administration.

Under Trump, much of the backlash against the tech industry focused on online speech, with Facebook and Google in the hot seat. Many on the right accused Big Tech of censoring conservative voices, while leaders on the left claimed the industry was too permissive of hate speech and content inciting violence. Lawmakers on both sides of the aisle called for the repeal or modification of Section 230, a law that shields internet companies from liability for content their users post.

Under Democrat leadership, tech oversight is likely to focus more on issues of marketplace fairness and workers rights, two subjects of frequent criticism lobbed at Amazon.

Margaret OMara
University of Washington professor Margaret O’Mara discusses the history of tech at the 2017 GeekWire Summit. (GeekWire Photo / Dan DeLong)

“Looking closely at that antitrust committee report that came out last summer, it was very specific, it was really going after the case of market competition in very granular ways,” said Margaret O’Mara, a tech historian and University of Washington professor, speaking on the GeekWire podcast this month. I think Amazon is squarely in its sights. More broadly, these antitrust questions about consumer harm and market harm, and competition [are] going back to a pretty old school definition of antitrust.”

But those shifting priorities won’t necessarily translate into antitrust charges, Mayo cautioned.

He agreed that “Democrats are certainly more concerned than Republicans with issues of workers rights” and marketplace dominance, but noted that those issues are difficult to prosecute under current antitrust law.

“They’re not harms that can be said to exist to competition but rather only to competitors and both Republicans and Democrats in the mainstream of antitrust adhere to the proposition that antitrust should be about protecting competition, not about protecting competitors. I suspect that in a Biden administration you’ll see that ethos reflected.”

Regulation or reconciliation?

After four years of rocky relations with the Trump administration, the tech industry appears eager to forge a more amicable relationship with the federal government under Biden.

Amazon wasted no time extending an olive branch. The Seattle tech giant sent a letter to Biden on Wednesday offering up its warehouses and logistical infrastructure to help with the COVID vaccine rollout.

“As you begin your work leading the country out of the COVID-19 crisis, Amazon stands ready to assist you in reaching your goal of vaccinating 100 million Americans in the first 100 days of your administration,” Amazon’s consumer chief Dave Clark said in the letter.

There are some early signals that Biden will enlist the tech industry to support his agenda. Tech employees were well-represented on his transition team and could also land top appointments.

Reports this week that Biden is considering attorneys who advised Google and Amazon during blockbuster cases to lead the Justice Department’s antitrust division have progressive groups up in arms. Biden is reportedly considering Renata Hesse, a former DOJ official who helped Amazon complete its Whole Foods merger, and Juan Arteaga, another alum of the Obama Justice Department who represented finance and tech corporations in high-profile cases.

“Media reports indicate that the Biden/Harris administration is planning to install Silicon Valley executives and lobbyists into key positions in the government, all but ensuring these corporations will continue to do enormous harm with total impunity,” said digital rights advocacy group Fight for the Future as part of a petition to block the appointments. “We can’t let that happen. The decisions we make about the role of Big Tech in our society over the next four years will define our future.”

Meanwhile, many tech leaders are cautiously optimistic about a new era of collaboration between the industry and federal government.

“The tech industry has been very actively involved in solving problems that the country’s been facing from the standpoint of the pandemic … there’s been a shift in the perception of what the tech industry is, in the public-private partnerships that exist to solve big, major societal challenges like this,” said Schutzler. “A lot of work still has to be done, obviously, but the tenor has changed. That seems to give some indication that there may be some interesting, rational conversations with the Biden administration in the first 100 days.”

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