The Big Tech breakup: Could it happen?

Art by Annie Gugliotta

"Don't be evil", they said. Back in 2000, that was the internal motto of a scrappy little tech startup called Google. Twenty years later, and a trillion dollars higher in market cap, the company, along with fellow tech giants Amazon, Apple, and Facebook, is squarely in the crosshairs of US lawmakers who say their business models have gone to the dark side.


The latest challenge — a 450-page report released Tuesday by the Democrat-controlled House of Representatives — says the four biggest US tech giants have abused their market power to undercut rivals and stifle competition, putting their users' economic and political freedoms at risk. The companies themselves say their businesses have created untold numbers of new jobs, markets, and innovations that previously did not exist.

Qualms about big tech firms' market power aren't new. The Justice Department and Federal Trade Commission are already conducting antitrust probes of all four companies, but the report lays out the case in detail. It also makes a series of recommendations for lawmakers on how to update competition laws and strengthen oversight of tech firms. Some of those calls go as far as to explore breaking up the companies.

Could the Beltway really take a tougher line on Silicon Valley? Democrats and Republicans (who rarely see eye to eye on anything these days) generally agree that Big Tech needs to be reined in, although they have often disagreed about why and how. Two Republican members of the House subcommittee that released the new report put out their own dissenting documents on the same day. One faulted the main report for failing to address what Republicans believe is an anti-conservative bias on social media. The other, more substantively, agreed with the main report's call to update antitrust laws, but rejected breaking up firms.

The lack of a durable bipartisan consensus means the November election will be critical. If the Democrats take control of the Senate, they'd be in a more commanding position to advance some of the report's proposals. The main players to watch would likely be senators Elizabeth Warren, who has been outspoken in her calls to break up big tech, and Amy Klobuchar, a major digital privacy and antitrust advocate who would likely lead the Senate antitrust subcommittee.

Still, Silicon valley has immense lobbying power to fight tougher regulations, and it's not clear that a centrist like Chuck Schumer, who would likely take the helm of a Democrat-controlled Senate, would relish a big fight on this issue any time soon.

Meanwhile, Democratic presidential nominee Joe Biden has, like his opponent Donald Trump, called for reform of the so-called "Section 230" protections that shield social media firms from liability for content posted on their sites. But although he's criticized Big Tech's market dominance, he'd have a lot on his plate if he won — tech regulation would probably take a back seat to the pandemic, economy, foreign policy, and climate change.

Is there a US-China angle here? Well it's tech, so of course there is. The US and China are moving into an increasingly zero-sum rivalry over technologies like 5G and artificial intelligence, in which the tech giants are major players. If this turns into a 21st-century "tech Cold War" in which firms on either side of the Pacific are the main combatants, US companies will be facing off against Chinese rivals (like Huawei) that have the firm support of the Chinese government, and face few antitrust constraints of their own.

Under those circumstances, will US lawmakers — who seem to agree across party lines on the need to confront China — think twice about putting fresh constraints on America's heavyweight fighters? Or would they reason that regulating Big Tech better would ease some of the social polarization that afflicts the US, and create an even more powerful and innovative economy in the future?

As digital technology reshapes the workplace, a move toward skills-based training and employment will unlock opportunities for companies and job seekers alike. While automation and AI are already taking on many routine tasks, demand for people with technology skills is rising fast around the globe. Getting the right people into the right jobs within the right organizations is one of the biggest challenges facing the world of work. So how can it be overcome? To read some recent skills-related stories, visit Microsoft On the Issues.

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How will the pause of Johnson & Johnson vaccine affect the overall pandemic fight in the United States?

Yeah. Right at it, right? Well, we heard that the FDA has suspended vaccines from J&J because of blood clots. They found six in seven million cases. It's kind of like the suspension of AstraZeneca in Europe. It's likely only going to last for a few days. It's a very small percentage of the total number of vaccines that are being jabbed right now into the arms of Americans. It's not going to really slow America's ability to get everyone vaccinated, but it is going to create more vaccine hesitancy. People at the margins will say, "Is this safe? They said it was fine. Now they're saying it's not okay." I understand why there's enormous caution on the part of the FDA, but I wish, wish, wish the communications had been a little softer around all of this. Also will be a problem in terms of export, as J&J is going to be a piece of that. And again, others around the world will say, "Well, if I don't get Moderna, if I don't get Pfizer, I'm not sure I want to take it at all." So all of this is negative news, though I would still say the United States this year is looking really, really good among major economies in dealing with pandemic.

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Ian Bremmer's Quick Take:

Hi everybody. Ian Bremmer here. Welcome to your week and I've got your Quick Take and thought I would talk a little bit about where we are with Iran. One of the Biden administration's promises upon election was to get the Americans back into the JCPOA, the Iranian nuclear deal. As of last week, negotiations are formally restarted, and pretty quickly, in Vienna, they're not direct. The Americans and Iranians are both there, but they're being intermediated by the Europeans because they're not yet ready to show that they can talk directly to each other. That's Iran being cautious in the run-up to their presidential election coming this summer. But the movement is there. So far the talk has largely been about sequencing the Iranian government, saying that all of the sanctions need to be removed before they're willing to go back into the deal, because the Americans after all, unilaterally withdrew from a deal that the Iranians were indeed adhering to, and the inspections did confirm that.

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