New antitrust legislation targets Apple, other tech giants

AppleInsider

A new bill being proposed will give the US government greater power to prevent mergers, and potentially penalize companies like Apple for antitrust practices at up to 30% of the income generated from the actions.

Antitrust legislation seeks to disrupt big tech

Apple, Facebook, and Google have been the target of the Senate Judiciary antitrust subcommittee in recent antitrust investigations. They all make the claim that their businesses are lawful and not monopolies, but the government is fighting back.

Now that the Democratic party has majority control of the House and Senate new bills will be introduced to combat antitrust cases. One new bill introduced by Senator Amy Klobuchar will give the government more power to penalize anti-competitive practices and prevent unlawful mergers.

According to Protocol the "Competition and Antitrust Law Enforcement Reform Act of 2021" offers sweeping reforms to antitrust laws, but are not as extreme as some have expected. Other legislators have called for a breakup of Facebook or other extreme action.

Klobuchar's bill would make it harder for powerful firms with substantial market power to acquire smaller companies and forbid mergers that present "appreciable risk of harming competition." It would place the burden of proof on the large companies, making them show that the acquisition won't disrupt the market.

The bill will also give legislators more power to penalize companies that do not follow antitrust law. Right now penalties range in the millions of dollars, pocket change for large companies like Facebook or Apple. The proposal suggests that US companies pay 15% of US revenue or 30% of their US revenue in an affected market upon proof of violation.

The legislation could also affect Apple's App Store. It calls for aggressive action against "monopsonies" which are markets dominated by a single buyer. This type of legislation could prevent platform holders from doing business on their own platform.

While the Democratic Party has the majority, it is only slight. The bill will need Republican support in order to make such sweeping changes, and Republicans do not want to break up large businesses in the same way.

viclauyyc

But how they define the monopoly power? Yes Apple has 100% controls  of App Store, but this also applies to to Walmart has 100% controls of what goes to it’s store shelf. Or you can’t get a six pack of coke but you want 2 of them Pepsi. 

ronn

"While the Democratic Party has the majority, it is only slight. The bill will need Republican support in order to make such sweeping changes, and Republicans do not want to break up large businesses in the same way."

Not true. With a 50-50 split, the Dems could pass it with every one of their members supporting it and VP Harris casting the tie-breaking vote. It would take just one Dem to be against it, which is highly likely; Manchin comes to mind, although depending on lobbying, I'm sure there could be one or two more Dems.

mjtomlin

Klobuchar's bill would make it harder for powerful firms with substantial market power to acquire smaller companies and forbid mergers that present "appreciable risk of harming competition." It would place the burden of proof on the large companies, making them show that the acquisition won't disrupt the market.

Umm... Shouldn't they be more concerned about big companies acquiring and merging with other big companies? Unfortunately, too little too late for all of that. Google, Facebook. And I do understand that you want to prevent a big company buying up smaller companies that compete with a particular product or service... Microsoft was infamous for this in the 90's.

This type of legislation could prevent platform holders from doing business on their own platform.

This basically wipes out an entire business model, making vertical integration an illegal practice. This will also have an adverse affect of pushing platform holders into being more likely to monetize their user base, instead of being able to pull in more revenue by offering 1st party services.

A silly example of the outcome of this... Amazon will no longer be able to sell eBooks on their Kindle devices! Haha. This is a very stupid law.

edited February 2021

zimmie

The "prevent platform holders from doing business on their own platform" is one bit of regulation which has worked really well in Texas. Here, companies are not allowed to both own power lines and own power generation capacity. Only one company handles the power lines to my house (giving them the captive market which justifies infrastructural spending), but their prices are regulated. Meanwhile, the power generation market is competitive. I can buy my electricity from a bunch of companies.

Unfortunately, we don't extend it to telecom companies. Owning the lines and owning content you sell over those lines should be prohibited.

pslice

The government has let big companies get away with this from the days of deregulating the airlines. Telecoms, entertainment, this is clearly a case of the horses are out of the barn. In computing, you have two dominant camps, Windoz and Apple. There IS competition. I don’t buy Windoz, I love Apple, and I appreciate Apple's quality. Break it up and government will lower the quality. 

acejax805

viclauyyc said:

But how they define the monopoly power? Yes Apple has 100% controls  of App Store, but this also applies to to Walmart has 100% controls of what goes to it’s store shelf. Or you can’t get a six pack of coke but you want 2 of them Pepsi. 

What you are forgetting is that same six pack of coke or Pepsi can be bought at almost any retail store and supermarket. Apple's App store is controlled by Apple and Apple alone, including payment processing. Over 1 billion active devices (consider those consumers) and they can only shop at one store which is 100% controlled by Apple. 

A more relative comparison would be if Walmart was the ONLY retailer American consumers could buy from. That is what Apple's App Store is to ALL Apple users.

jimh2

zimmie said:

The "prevent platform holders from doing business on their own platform" is one bit of regulation which has worked really well in Texas. Here, companies are not allowed to both own power lines and own power generation capacity. Only one company handles the power lines to my house (giving them the captive market which justifies infrastructural spending), but their prices are regulated. Meanwhile, the power generation market is competitive. I can buy my electricity from a bunch of companies.

Unfortunately, we don't extend it to telecom companies. Owning the lines and owning content you sell over those lines should be prohibited.

Most places in the country do not have choices for suppliers. Separate line items on the bill, but no choice for supplier(s). I did notice once the switch to the possibility of having separate suppliers the cost was more when comparing usage.

qwerty52

Isn’t it someone out there, who is capable of making clear to all those senators, that with what they are intending to do to this American companies, they are going to make them weaker and less competitive. In this way they are widely opening the doors for the
China’s state-sponsored mega companies. This senators are doing just the opposite around of what China is doing.

jimh2

acejax805 said:

viclauyyc said:

But how they define the monopoly power? Yes Apple has 100% controls  of App Store, but this also applies to to Walmart has 100% controls of what goes to it’s store shelf. Or you can’t get a six pack of coke but you want 2 of them Pepsi. 

What you are forgetting is that same six pack of coke or Pepsi can be bought at almost any retail store and supermarket. Apple's App store is controlled by Apple and Apple alone, including payment processing. Over 1 billion active devices (consider those consumers) and they can only shop at one store which is 100% controlled by Apple. 

A more relative comparison would be if Walmart was the ONLY retailer American consumers could buy from. That is what Apple's App Store is to ALL Apple users.

In rural areas Walmart is the ONLY retailer they can buy from. For other parts of the country they are the choice as they have what they need, adequate supplies, large selection, lowest prices, and are all over the country.

jimh2

AppleInsider said:

A new bill being proposed will give the US government greater power to prevent mergers, and potentially penalize companies like Apple for antitrust practices at up to 30% of the income generated from the actions.

Apple, Facebook, and Google have been the target of the Senate Judiciary antitrust subcommittee in recent antitrust investigations. They all make the claim that their businesses are lawful and not monopolies, but the government is fighting back.

Now that the Democratic party has majority control of the House and Senate new bills will be introduced to combat antitrust cases. One new bill introduced by Senator Amy Klobuchar will give the government more power to penalize anti-competitive practices and prevent unlawful mergers.

According to Protocol the "Competition and Antitrust Law Enforcement Reform Act of 2021" offers sweeping reforms to antitrust laws, but are not as extreme as some have expected. Other legislators have called for a breakup of Facebook or other extreme action.

Klobuchar's bill would make it harder for powerful firms with substantial market power to acquire smaller companies and forbid mergers that present "appreciable risk of harming competition." It would place the burden of proof on the large companies, making them show that the acquisition won't disrupt the market.

The bill will also give legislators more power to penalize companies that do not follow antitrust law. Right now penalties range in the millions of dollars, pocket change for large companies like Facebook or Apple. The proposal suggests that US companies pay 15% of US revenue or 30% of their US revenue in an affected market upon proof of violation.

The legislation could also affect Apple's App Store. It calls for aggressive action against "monopsonies" which are markets dominated by a single buyer. This type of legislation could prevent platform holders from doing business on their own platform.

While the Democratic Party has the majority, it is only slight. The bill will need Republican support in order to make such sweeping changes, and Republicans do not want to break up large businesses in the same way.

This is what happens when you elect people who have never done anything in their lives other than suck off the tit of the government. Can you imagine being a smaller firm struggling to get by, but with a great idea and being told a larger company cannot buy you. That is an un-American as it gets. Socialism is starting to get a foothold if crap legislation like this passes. I do not want to live in a country where the government decides that we need to settle for lesser quality in order to have competitors. This is what will happen if the government gets to meddling in these companies business models. 

muaddib

Considering Big Tech is a major donor for Democrats I find the law quite ironic. Republicans might be on board with this as well, since they claim Big Tech is censoring them.

aderutter

Many start-ups target being taken over from day one. I have worked for/with several. 

If you prevent large companies buying smaller ones then you will kill a lot of start-ups from even starting up.

cornchip

muaddib said:

Considering Big Tech is a major donor for Democrats I find the law quite ironic. Republicans might be on board with this as well, since they claim Big Tech is censoring them.

And that’s how socialism works. It’s all green fields and rainbows until they start coming after your $#!%. 

By then it’s too late. Careful what you ask for. 

viclauyyc

acejax805 said:

viclauyyc said:

But how they define the monopoly power? Yes Apple has 100% controls  of App Store, but this also applies to to Walmart has 100% controls of what goes to it’s store shelf. Or you can’t get a six pack of coke but you want 2 of them Pepsi. 

What you are forgetting is that same six pack of coke or Pepsi can be bought at almost any retail store and supermarket. Apple's App store is controlled by Apple and Apple alone, including payment processing. Over 1 billion active devices (consider those consumers) and they can only shop at one store which is 100% controlled by Apple. 

A more relative comparison would be if Walmart was the ONLY retailer American consumers could buy from. That is what Apple's App Store is to ALL Apple users.

But you can’t just replace the 2 can of coke with Pepsi in a six pack, right? It can’t be just mix and match.

Yes, you can only use App Store with iDevice. But you forgot a very large % of devices which used android. These devices preformed very similar function as iDevice, just not as good. It is not monopoly when the other guy has bigger market share than yours. 

Also, pretty much all iOS app use development tool from apple and apple owned the IP. If a company want to sideload their app, shouldn’t they create their own dev tool?

And since the cloud computing become so popular, developer can use the cloud to run their app with browser, apple never stop anyone do that. 

viclauyyc

jimh2 said:

This is what happens when you elect people who have never done anything in their lives other than suck off the tit of the government. Can you imagine being a smaller firm struggling to get by, but with a great idea and being told a larger company cannot buy you. That is an un-American as it gets. Socialism is starting to get a foothold if crap legislation like this passes. I do not want to live in a country where the government decides that we need to settle for lesser quality in order to have competitors. This is what will happen if the government gets to meddling in these companies business models. 

So in your opinion, should US abandon antitrust and monopoly laws and let the big tech do whatever they want?

also, at least these politicians are elected. Not because they are family of POTUS or work for big firm before they join the government. 

And yes, not all elected officials are qualified, just look at 45. 

sellerington

This is what you voted for!

Apple supported the Democratic Party and now they will pay the price.

ronn

Chicken Littles all over this post. Just because it's proposed doesn't mean it'll happen. The Dems would all have to agree. Or there would have to be GOP support. Rarely does proposed legislation happen without major revisions and/or omissions. There does need to be some oversight of Big Tech. Let's just hope it's adequate, intelligent (a big leap of faith with Congress!) and not rushed.

genovelle

mjtomlin said:

Klobuchar's bill would make it harder for powerful firms with substantial market power to acquire smaller companies and forbid mergers that present "appreciable risk of harming competition." It would place the burden of proof on the large companies, making them show that the acquisition won't disrupt the market.

Umm... Shouldn't they be more concerned about big companies acquiring and merging with other big companies? Unfortunately, too little too late for all of that. Google, Facebook. And I do understand that you want to prevent a big company buying up smaller companies that compete with a particular product or service... Microsoft was infamous for this in the 90's.

This type of legislation could prevent platform holders from doing business on their own platform.

This basically wipes out an entire business model, making vertical integration an illegal practice. This will also have an adverse affect of pushing platform holders into being more likely to monetize their user base, instead of being able to pull in more revenue by offering 1st party services.

A silly example of the outcome of this... Amazon will no longer be able to sell eBooks on their Kindle devices! Haha. This is a very stupid law.

Very stupid indeed. The reason Apple gets into markets or develops platforms is to give other developers and opportunity to build upon what they are doing themselves. They create their own apps to keep their platform from being at the mercy of tech heads who may try to push one platform like happened with Microsoft in the 90s and nearly put them out of business. 

If they are not participating then their will be two markets. One for 3rd party and Apple will just do a single subscription and include everything they make. Or just integrate it in the selling price. On the other Gand if they find the App Store to be unprofitable all of a sudden, they will stop investing in it and it will suffer the fate of apps on Newton 

genovelle

jimh2 said:

acejax805 said:

viclauyyc said:

But how they define the monopoly power? Yes Apple has 100% controls  of App Store, but this also applies to to Walmart has 100% controls of what goes to it’s store shelf. Or you can’t get a six pack of coke but you want 2 of them Pepsi. 

What you are forgetting is that same six pack of coke or Pepsi can be bought at almost any retail store and supermarket. Apple's App store is controlled by Apple and Apple alone, including payment processing. Over 1 billion active devices (consider those consumers) and they can only shop at one store which is 100% controlled by Apple. 

A more relative comparison would be if Walmart was the ONLY retailer American consumers could buy from. That is what Apple's App Store is to ALL Apple users.

In rural areas Walmart is the ONLY retailer they can buy from. For other parts of the country they are the choice as they have what they need, adequate supplies, large selection, lowest prices, and are all over the country.

actually Apple is not the only place that sells these apps. If you want them using Apples tools and design supported elements you buy an Apple product. 

loids

viclauyyc said:

jimh2 said:

This is what happens when you elect people who have never done anything in their lives other than suck off the tit of the government. Can you imagine being a smaller firm struggling to get by, but with a great idea and being told a larger company cannot buy you. That is an un-American as it gets. Socialism is starting to get a foothold if crap legislation like this passes. I do not want to live in a country where the government decides that we need to settle for lesser quality in order to have competitors. This is what will happen if the government gets to meddling in these companies business models. 

So in your opinion, should US abandon antitrust and monopoly laws and let the big tech do whatever they want?

also, at least these politicians are elected. Not because they are family of POTUS or work for big firm before they join the government. 

And yes, not all elected officials are qualified, just look at 45. 

Why is it “all or nothing” ?  The US doesn’t have to abandon anti trust, but if consumers generally like the product and service being offered ( from Apple ), why change it ?

So the politicians are elected - they only care about getting re-elected...they are completely out of touch.  I would much rather hear from someone who has actually ”worked” in business.  The elected officials you speak of only wan to tax their way out of everything...they don’t care about growing anything.

Explain to me why or how it was legit for Biden’s son to earn $50,000 per month working for a Ukrainian gas company ?  

You rip Trump and his family - besides milking the tax payer for over 40 years what has Biden accomplished ?