Alphabet (Google's parent), Amazon, Apple, Facebook, and Microsoft are, unsurprisingly, the biggest potential targets in today's antitrust universe. The Five, measured by stock market value, are half of the world's 10 largest companies, and now they are positioning themselves to enter non-tech markets such as autos, finance, and health care. Furthermore, they often snap up any competition that might emerge. Facebook, for example, acquired Instagram and WhatsApp, while Google bought Android and YouTube. Google's announced the acquisition of Fitbit, with its trove of personal information from 28 million users, is under federal review at this writing.

Do the five tech giants threaten American welfare? Jeremy Phillips, general partner at Spark Capital, argued in The New York Times that we should keep an eye on the Big Five, but he notes that they are increasingly each other's competitor; just what we want in a free market. Then he points to the example of Netflix, which effectively destroyed video rental stores (Do you remember Blockbuster?) and now is itself facing intense competition from Amazon, Apple, Hulu, HBO, and others. Phillips looks at Amazon and sees a colossus, certainly, but one that is constantly threatened by tech competitors, as well as by Walmart and other traditional retailers.

Free-market arguments notwithstanding, consumers have become increasingly nervous about the dominance of these big firms. Privacy threats have grown. Personal online abuse like bullying, along with political chicanery from Russia and elsewhere, have shaken consumer faith. And the tech giants that we admired for their power to disrupt and improve commerce have become entrenched institutions, arguably using their authority to dominate and maintain rather than disrupt.

As mentioned in Chapter 10, the European Commission has fined Google for alleged market abuses, but in the United States, the Federal Trade Commission (FTC) investigated Google's search practices and in 2013 declined to pursue litigation. The FTC concluded that Google's search practices were not anticompetitive in that they were designed primarily to improve the quality of the product delivered to consumers. Search alternatives to Google are plentiful. (Google handles about two-thirds of the searches and earns up to 90 percent of the search revenue in the United States Internet market).

Some news reports, at this writing, indicate the federal Justice Department and many state attorneys general are close to filing antitrust suits against Google because of its extraordinary power in Internet advertising and searches. Several other big, online platforms apparently also are under antitrust review by various government bodies.

Requirement:

Critics, including Facebook co-founder Chris Hughes, have campaigned for breaking up Facebook. (Hughes is no longer associated with the company.)

1. Why are the critics concerned?

2. Should we break up Facebook? Raise all of the relevant issues.

Sources:"High Fines, Meager Results; Europe v Google," The Economist,July 21, 2018 [www.economist.com]; Farhad Manjoo, "Tech Giants Seem Invincible. That Worries Lawmakers," The New York Times,January 4, 2017 [www.nytimes.com]; and Jeremy G. Philips, "the 'Frightful Five' Aren't So Scary, as Long as They're Competing," The New York Times,May 8, 2017 [www.nytimes.com].

NOTE: This discussion board is based off of material learned during Week 5.

Remember: These are research and discussion posts. Please respond with a well-developed, well-supported response using case law or statutory law discussed in the textbook. Fastcase (available on the UMass Library website) can also be used.

1101