Antitrust laws are a collection of federal and state regulations that dictate the conduct and organization of business corporations to promote competition for the benefit of consumers. They prohibit price-fixing practices that unreasonably restrain trade and restrict mergers and acquisitions of businesses that would substantially lessen competition. The history of antitrust laws dates to the Roman Empire. Business practices of market traders, guilds, and governments have always been subject to scrutiny. Since the 20th century, antitrust laws have become a global practice. The antitrust probes into big tech companies like Facebook, Google, and Amazon have been going on for a year. These companies recently announced that their CEO’s would testify on the antitrust probes, making history.
Last July, the FTC started conducting an antitrust probe into Facebook. The FTC is reviewing whether Facebook’s acquisitions of Instagram and WhatsApp were anticompetitive. Since 2003, Facebook has purchased over 80 companies. The company is under investigation to determine whether it is suppressing competition and putting users at risk. Along with the acquisitions of Instagram and WhatsApp, the examination includes whether Facebook put consumer data at risk, reduced the quality of consumer’s choices, and increased the price of advertising. Last week, Mark Zuckerberg agreed to testify before Congress if the other big tech firms testified as well.
Google is another big tech company that is being investigated for violating antitrust laws. The antitrust probe, announced by the DOJ in June 2019, includes a review of Google’s position in the ad tech marketplace and the company’s search practices. Google has gone mostly unscathed, even as it has become one of the most dominant digital advertising businesses. The company started to become a target by conservatives who feel that Google is exhibiting bias towards Republicans and non-liberal viewpoints. Google’s CEO, Sundar Pichai, is another chief executive willing to testify before Congress.
Amazon is facing an investigation by antitrust officials on whether it is using its marketplace influence to hurt competition. The FTC has interviewed small businesses on how much revenue they make on Amazon compared to other online marketplaces. Lawsuits against Amazon allege that the company’s policies with third-party sellers for them to sell their products on their sites, or competitor sites, at the same price as they do on Amazon. This action restricts competition for shoppers looking for the best price. A lawyer for Amazon said CEO Jeff Bezos is available to testify before Congress, making it Bezos’ first such appearance.
Antitrust laws have been around for centuries but didn’t become global practice until the 20th century. These laws ban price-fixing, ensure fair trade practices, and limit M&A of businesses that would ruin the competition. The recent antitrust probes into big tech companies like Facebook, Google, and Amazon, have put the CEOs on track to testify before Congress. Public testimonies of America’s powerful CEO’s would represent a landmark moment in the battles between Washington D.C. and Silicon Valley.