Thread by @matthewstoller

The threats Facebook and Google made to Australia after that country attempted to regulate them come up in the Cicilline Report on big tech. Apparently @davidcicilline is unhappy when big tech monopolies threaten sovereign nations.

“It would be commercial suicide to be in Amazon’s crosshairs . . . If Amazon saw us criticizing, I have no doubt they would remove our access and destroy our business.”

- Anonymous partner of Amazon to the Antitrust Subcommittee

An attorney representing app developers said they “fear retaliation by Apple” and are “worried that their private communications are being monitored, so they won’t speak out against abusive and discriminatory behavior.”

Jfc

Big tech report is here: judiciary.house.gov/uploadedfiles/…

This big tech report is a very sophisticated document, with lots of explanations of how markets work and how technology businesses operate.

There's a terrific section in this report analyzing how cloud computing works. judiciary.house.gov/uploadedfiles/…

"A former employee explained that as a product manager at Facebook “your only job is to get an extra minute. It’s immoral. They don’t ask where it’s coming from. They can monetize a minute of activity at a certain rate. So the only metric is getting another minute.”

Oof.

Finally we get reliable data on Facebook!

In December of 2019, the Facebook app had 200.3 million users in the United States, reaching 74% of smartphone users.

Whoa, a presentation done by Sheryl Sandberg on social networking: "The industry consolidates as it matures."

Facebook’s senior executives described the company’s mergers and acquisitions strategy in 2014 as a “land grab” to “shore up our position."

There are a lot of angry ex-Facebook employees. Here's one who told the subcommittee that it's just not very hard to split up Instagram and Facebook. It's essentially copying and pasting some code.

The Cicilline Report essentially says Zuckerberg lied about how important Facebook's investment in Instagram have been.

If the FTC can't bring an antitrust case against Facebook just lock the building and hand over the keys to the National Gallery across the street. At least if it were a museum it would offer the public some use.

Definitely seems like Google was the most openly dishonest of the four companies being investigated. Google said 'we don't have a dominant market share,' then refused to provide market share data, then said they don't even collect it, but of course, their docs show they do.

Some quality trolling in the footnotes. In response to Google being obnoxiously evasive about market share questions, the subcommittee noted 'interesting how Microsoft was obnoxiously evasive about market share.'

All done with Bluebook formatting.

Amazon calling the big tech report by the House Antitrust Subcommittee "fringe." @JayCarney is just a charmer isn't he?

https://twitter.com/amazonnews/status/1313602098274226176

"Public reporting suggests that, as of 2019, Google had increased the price of search ads by about 5% per year, exceeding the U.S. inflation rate at that time of 1.6%."

The Antitrust Subcommittee nailed Google for sticking Google Meet in your face every time you want to get onto a Zoom call. @benyt

This is interesting, Google ties its dominance in Maps to Google Cloud. To use Maps API keys you have to have a Google Cloud Platform account.

The subcommittee called out so many lies, misleading statements, and omissions from Google.

On to Amazon. This is... ooof.

"In response to the Committee’s request for “A list of the Company’s top ten competitors,” Amazon identified 1,700 companies, including Eero (a company Amazon owns), a discount surgical supply distributor, and a beef jerky company."

Hi @JayCarney

Spoke too soon on this one. The Cicilline report starts the section on Amazon noting the company may have committed perjury, so investigators don't trust the company's information.

https://twitter.com/matthewstoller/status/1313602797108178945

Amazon's Kiva robotics acquisition was so obviously corrupt and anti-competitive, simply done to block competitors who sought to improve their warehousing operations.

So @davidcicilline throws so much shade at the enforcers. Here he is noting how both Obama and Trump enforcers had strong evidence on bad mergers but didn't bother to do anything.

"For most, if not all, of the acquisitions discussed in this Report, the FTC had advance notice of the deals, but did not attempt to block any of them."

That is some ugliness right there.

This is some bullshit resolution to what very much looked like perjury that Amazon lobbyist Nate Sutton offered about the abuse of third party merchant data to create private label products.

Roku couldn't buy advertise on Amazon for a keyword search of its own brand because it competes with something Amazon makes.

Whoa, the subcommittee found that Jeff Bezos misled the committee. Amazon does consider profitability when determining which merchant gets to place its products in front of consumers.

"For example, since Amazon opened a warehouse in Lexington County, South Carolina in 2011, the county has seen average annual wages for warehouse workers fall more than 30%, from $47,000 to $32,000 annually."

On and on and on.

This nugget is a big deal. One person speaking to the subcommittee had evidence Amazon's AWS was engaged in "cross-business data sharing." It's unclear what that means, but don't use AWS if you don't want Amazon to know your business.

There's some great analysis of anti-competitive tactics by Amazon Web Services in this report. A sort of mix between Microsoft tactics in the 1980s/1990s and Google's in the 2000s.

The remedies proposed by the Antitrust Committee report are rooted in its past work, such as the 1958 report on the airline industry and a 1957 report on the broadcast TV.

So much shade towards enforcers.

The Cicilline Report recommends implementing an Abuse of Dominance standard on a Federal level, which is what @SenGianaris's bill would do for New York.

More quality trolling in the footnotes. In this one the subcommittee staff goes after Frank Easterbrook and his ridiculous error framework for mergers.

"Meanwhile, both agencies have targeted their enforcement efforts on relatively small players—including ice skating teachers and organists—raising questions about their enforcement priorities."

Such trolling of enforcers. Love it.

The remedies are pretty strong: (1) legislative breakups (2) strengthen merger and monopolization law (3) reform enforcers and (4) restore the ability of private citizens to sue monopolists.

It's a great report. Wow. /Fin

My wrap-up. This report is a BIG DEAL. mattstoller.substack.com/p/congress-get…