This summer has seen a steady parade of tech CEOs quietly heading to Capitol Hill.
Apple (AAPL) CEO Tim Cook stopped by recently, as did Google (GOOG, GOOGL) CEO Sundar Pichai and Amazon (AMZN) CEO Andy Jassy. Microsoft (MSFT) President Brad Smith joined in with a reported sit-down with Senate Majority Leader Chuck Schumer (D-NY) in Washington state.
Their reason for calling on U.S. lawmakers? The tech CEOs are fighting a bill called the American Innovation and Choice Online Act, which would bar Big Tech from favoring their own products over competitors.
The trips to Capitol Hill appear to be paying off, with momentum on the bill slowing. The latest hit came this week when Schumer reportedly told donors that he doesn’t believe there are enough votes to pass the bill. The bill was already set to miss a window this summer for consideration by the full Senate. The outlook for the bill could shift in the fall, but the midterm elections could hinder its progress.
For their part, advocates for the bill say Schumer is wrong and that votes are there. Evan Greer of a group called Fight for the Future noted that the tech CEOs’ lobbying trips to Washington alone signal that the bill has a good chance of becoming law. Why would they fight the bill if it were a long-shot?
“They’re scared,” Greer said, referring to the tech CEOs.
Senator Amy Klobuchar (D-MN) — who’s spearheading the bipartisan tech bill along with Senator Chuck Grassley (R-IA) — spoke for nearly 50 minutes on the Senate floor earlier this month about the effort, sounding off about Big Tech’s lobbying efforts.
“Please, spare me the ‘we have not learned enough about this,’” she said of Washington’s repeated delays to act on the tech bill.
‘Rules of the road’
In January, the Klobuchar-Grassley effort moved forward in the Senate and appeared to be gathering momentum. Advocates hailed it as the first major tech bill to advance to the Senate floor “since the dawn of the internet” — but it has yet to come a vote.
The bill aims to set “rules of the road” for how digital platforms can and cannot preference their own products and services. Its core provision would prohibit companies from favoring their own products in areas like search results or ad purchasing. The bill would also aim to stop companies from unfairly using the data of competitors, and it would furnish antitrust regulators with new resources to crack down violators.
“Amazon won’t be able to misuse small business’s data in order to copy their products and then compete against them. Apple won’t be able to stifle competition by blocking other companies’ services from interoperating with their platforms,” Klobuchar noted recently, “and Google won’t be able to bias their platform’s search results in favor of their own products and services without merit.”
Amazon in particular has drawn criticism for using its selling platform to gain an unfair advantage. In 2020, the Wall Street Journal notably reported that the e-commerce giant was using data from third-party sellers on its site to launch its own competing products.
“Amazon engages in the very practices — including self-preferencing and abuse of third-party data — that this bill would outlaw,” said Ken Buck (R-CO), another proponent of the bill.
Of course, Big Tech has not taken kindly to the bill. A Google executive contended earlier this year “the vague and sweeping provisions of these bills would break popular products.” Amazon argues that it would slow its package deliveries. Groups funded by Big Tech have contended the bill would hurt consumers, with the U.S. Chamber of Commerce saying it could raise prices.
But many experts don’t necessarily agree that the bill would hurt consumers.
“If the theory of the bill is right, users would experience a greater diversity and variety and lower prices from a variety of merchants, as opposed to just getting the stuff that Amazon itself has an interest in,” Mark MacCarthy at the Center for Technology Innovation at the Brookings Institution told Yahoo Finance.
‘A game of chicken at this point’
Observers and activists have focused much of their attention on Schumer to try prod him to call a vote. They haven’t succeeded, at least not yet.
“It’s really just kind of a game of chicken at this point,” says Greer with the key question being “will Schumer put the bills on the floor or will he cave to the tech companies?”
Grassley has reportedly told Schumer that he has the Republican votes to pass the law. But the Democratic leader has repeatedly said, including again this week, that he isn’t sure the support is there yet.
In the meantime, tech companies have gotten notice for the breadth of their lobbying effort against the bill: from bundling money for midterm election efforts to spending millions on advertising around the country. Amazon CEO Andy Jassy has reportedly visited DC at least three times since taking over from Jeff Bezos last year as part of a more active role in political affairs.
In her recent speech, Klobuchar compared herself to David with the tech companies cast in the role of Goliath. “It’s time to stop throwing the popcorn at the CEOs and actually do something,” she said.
Ben Werschkul is a writer and producer for Yahoo Finance in Washington, DC.
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