- CounterPunch.org - https://www.counterpunch.org -

Break-Up Big Tech? Amazon, a Public Utility?: Keep Your Fingers Crossed

Photograph Source: Tony Webster – CC BY 2.0

“Today’s big tech companies have too much power — too much power over our economy, our society, and our democracy,” wrote Sen. Elizabeth Warren (D-MA) during her failed presidential run in 2019. “They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else. And in the process, they have hurt small businesses and stifled innovation.”

She also noted that “America has a long tradition of breaking up companies when they have become too big and dominant — even if they are generally providing good service at a reasonable price.”  One of her proposals called to “unwind anti-competitive mergers,” including Amazon (Whole Foods, Zappos), Facebook (WhatsApp, Instagram) and Google (Waze, Nest, DoubleClick).

Well, in early June, Republicans and Democrats signed on to a series of five bills that could significantly limit such big tech companies like Amazon, Apple, Facebook and Google from using their control over multiple business lines to favor their own products or to suppress rivals. It would set up a mechanism by which a giant conglomerate could be broken up if it didn’t comply.

The proposed legislation could significantly limit the ability of any of the four big tech companies to complete large mergers, would raise the cost of filing for their clearance and would mandate them to make it easier for users to leave their platforms with their data intact.

The potential consequences of the the proposed legislation could be significant: it could stop Google from promoting YouTube in its search results; prohibit Amazon from selling products on its marketplace that compete directly with third-party seller listings; require Apple to relax its restrictions on iOS app developers; and block Facebook from acquiring nascent companies for the purpose of stifling future rivals.

Another of Warren’s proposals involved re-designating “companies with an annual global revenue of $25 billion or more and that offer to the public an online marketplace, an exchange, or a platform for connecting third parties would be designated as ‘platform utilities.’”

Going further, she argued that “these companies would be prohibited from owning both the platform utility and any participants on that platform. Platform utilities would be required to meet a standard of fair, reasonable, and nondiscriminatory dealing with users. Platform utilities would not be allowed to transfer or share data with third parties.”

On June 6th, Ohio’s Republican Attorney General, Dave Yost, must have heard Warren’s message in his ear for he filed a lawsuit asking the Delaware County’s Common Pleas Court to declare Google a public utility.  He said it was time called for “reining in the ways the powerful search engine provides search results to Ohioans.”

“Google uses its dominance of internet search to steer Ohioans to Google’s own products–that’s discriminatory and anti-competitive,” Yost added. “When you own the railroad or the electric company or the cellphone tower, you have to treat everyone the same and give everybody access.”

Ohio is the first state in the country to bring such a lawsuit.

***

On September 21, 1932, the U.S. was in the throes of the Great Depression and Franklin D. Roosevelt was running for president.  Not unlike today’s mounting economic crisis, he addressed a major social crisis of the day, faltering electrical service.  “My answer has been, as it is tonight, to point out these plain principles,” Roosevelt told his audience in Portland, OR. “That where a community — a city or county or a district — is not satisfied with the service rendered or the rates charged by the private utility, it has the undeniable basic right, as one of its functions of government, one of its functions of home rule, to set up … its own governmentally owned and operated service.”

Susan Crawford, a Harvard law professor, is the strongest advocate for replacing the privately-operator, quasi-monopoly telecom system and other industrial sectors with one based on a public utility model.

Crawford points out that “a utility is not a luxury. Utility services can be sold by private or public entities, but they are always subject to public obligations to reach everyone at a reasonable price, with a service meeting public quality standards.”  She adds, “services that start off as luxuries can become utilities as their centrality to life becomes clear.”

Digging deeper, Crawford lays out a critical analysis of municipal broadband that applied equally to other sectors.  “Utilities are things, physical networks, that public utility commissions regulate: electric, gas, communications, water, and wastewater, mostly.”  She notes, “these commissions typically ensure that utilities provide reasonably priced, adequate, and efficient services to customers, while allowing the companies involved to recover their costs plus a fair return to their investors.”

Over the last few years, a growing number of states and municipalities across the country have embraced municipally owned utility services.  The American Public Power Association reports that there are “about 2,000 cities with public power utilities or ‘munis,’ and more than 900 cooperatively owned power companies that collectively serve over 100 million Americans.” In addition, Broadband Now found that, as of April 2021, there were over 500 community broadband networks operating in the U.S.

Jon Brodkin, a columnist for Ars Technica, notes, that the Ohio “lawsuit was influenced by Supreme Court Justice Clarence Thomas’s recent concurring opinion in which he argued that Twitter and similar companies could face First Amendment restrictions … and that free-speech law shouldn’t necessarily prevent lawmakers from regulating those platforms as common carriers.”

Broken points out that Thomas’s opinion was in response to Twitter’s banning of Donald Trump’s comments in the wake of the January 6th attack on the Capitol.  Thomas wrote: “In many ways, digital platforms that hold themselves out to the public resemble traditional common carriers. Though digital instead of physical, they are at bottom communications networks, and they “carry” information from one user to another.”

***

So, breaking-up big tech or re-regulating it as a post-modern utility may be an effective way contain such big-tech conglomerates like Amazon, Google and Face.  And while we are it, why not re-regulated the “Telecom Trust” of AT&T, Verizon and Comcast as utilities. Maybe the best way to move U.S. corporations forward in the 21st century is to move back to Roosevelt’s call for a “governmentally owned and operated service.”