Citing Market Power, GOP State AGs Suggest Big Tech Breakup Is Needed

Big tech companies like Google might need to be broken up because Silicon Valley market power is threatening democracy, three Republican state attorneys general told the FTC Wednesday. During a competition policy hearing, Nebraska AG Doug Peterson (R) urged state enforcers to be fast, thorough and thoughtful in probing the industry: “Once we gather the information necessary, we have to consider whether or not to break things.”

“Structural change driven by the government may well be necessary,” said Tennessee AG Herbert Slatery (R). “Working around the edges of regulation is probably not going to help. Fines are an appropriate remedy, but they’re essentially the cost of business that can easily be passed onto consumers.” Internet Association didn't comment.

Through its advertising tech monopoly, Google picks winners and losers, said Louisiana AG Jeff Landry (R): “Continuing down this road will kill online publishing, or Google will control who stays and who goes. How’s that for fulfilling the promise of the internet as an open place?” He warned corporate power can become stronger than government and, in turn, democracy. Google can tell advertisers everything they need to know about their target audiences, and it’s “wholly” unregulated, Landry said.

Peterson cited Columbia Law School professor Tim Wu’s claim concentration of private power is a threat to constitutional design, and antitrust law provides the “final check” on private power. He suggested Google’s past buy of DoubleClick was harmful and called false the arguments the market would even itself out. Antitrust law needs to protect the health of the free market, Peterson said, noting the consumer welfare standard can adapt to the tech industry. He said the scope and power of big tech’s data is so far-reaching that it’s imperative for AGs, DOJ and the FTC to take this “very seriously.” Silicon Valley’s shift from mobile technology to artificial intelligence means the U.S. needs to be that much more aware, he said.

These “data barons” are able to build “super profiles” of consumers, using location data, purchase data, photos, friends, likes and an endless amount of other information, Peterson said. The question becomes does industry or the consumer own the data, Slatery said. Tennessee believes consumers own the data, and if industry wants to own it, it must secure consent in a transparent manner, Slatery said: “Not a person in this room knows how their data is used, much less the value it holds in the hands of these tech companies.” Peterson argued the so-called “free” services aren’t entirely free because consumers pay for broadband and mobile use.

There’s also a need for transparency on content moderation, said South Dakota AG Jason Ravnsborg (R) on a separate panel. Every organization needs to explain the “rules,” he said. If companies “make a mistake or it’s part of the algorithm, what are they going to do to change it or make an improvement? Good communication is also essential.” The office for Texas AG Ken Paxton (R) encourages self-regulation, Assistant Attorney General Jeff Mateer said: Lacking self-regulation, “I think states, the federal government, us as enforcers, are going to have to seek those type of results.”