Google parent Alphabet Inc (NASDAQ:GOOGL), Facebook Inc (NASDAQ:FB) and other tech giants should be subject to wider antitrust investigations and broken up, according to an influential Washington DC thinktank.
On Tuesday, the American Economic Liberties Project (AELP) issued a report to the incoming Biden administration saying that economic power concentration has reached “extreme proportions in virtually every sector of the economy” which in turn was causing serious economic challenges including inequality, reduced productivity and a decline in freedom of the press.
READ: Google, Facebook, Apple and the rest of Big Tech face regulatory pressure on both sides of the Atlantic
“Though it is now widely accepted that corporate concentration is extreme and contributing to a broad range of economic and social problems, less is understood about why progressive enforcers contributed to this crisis and how we can correct course. With this landmark report, we hope to answer those questions and provide a clear roadmap for Congress and the incoming Biden administration on how and why a new approach to antitrust and competition policy are central to building back better”, said AELP executive director Sarah Miller, who also serves on Biden’s presidential transition team.
The report urges the incoming administration to expand exist antitrust actions against Google and Facebook as a signal to the business community, as well as strengthening antitrust laws, undoing “problematic” mergers, reviving dormant regulatory enforcement tools and engaging in “a sustained legislative and executive branch campaign to break up and regulate dominant corporations across the economy”.
“There is increased recognition on both sides of the aisle that corporate consolidation is a political and economic threat to democracy itself, as well as a growing constellation of efforts at the local, state, and federal level to address it. Now, President-elect Biden and a new Congress have an opportunity to lead the way”, AELP said.
The AELP report marks another salvo against the tech giants as they battle against increased regulatory pressure across the world amid concerns over their expansive economic power.
In early December, the Federal Trade Commission (FTC) and a coalition of 48 US states filed a collection of lawsuits against Facebook alleging that the social media giant has engaged in anticompetitive behaviour and abused its market position to crush potential rivals.
Meanwhile, regulators in the EU and the UK have introduced plans for new legislation that could see tech firms hit with heavy penalties if they violate competition rules or fail to police content on their platforms effectively.
Shares in Facebook were down 1.1% at US$254 in mid-morning trading in New York, while Alphabet fell 0.6% to US$1,747.