With help from Leah Nylen, Cristiano Lima and John Hendel
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— House antitrust probe nears the finish line: Competition experts will testify this afternoon on what Congress should do next about tech giants’ power — one of the final steps in the House antitrust probe that has captivated Washington and Silicon Valley’s attention for more than a year.
— Sparks will fly in the Senate: The Senate Commerce Committee is convening this morning to vote on Republican lawmakers’ move to subpoena the CEOs of Facebook, Google and Twitter.
— 230 mixology: Senate Judiciary is today marking up Chair Lindsey Graham’s controversial bill that mashes up copyright language with a GOP-led proposal targeting Section 230 — and Democrats are likely to have none of it.
HELLOOOO, OCTOBER! IT’S THURSDAY; WELCOME TO MORNING TECH. I’m your host, Alexandra Levine.
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THE FUTURE OF TECH ANTITRUST, IN THE EYES OF THE EXPERTS — Time flies when you’re on deadline. After fifteen months, House Judiciary is (finally!) wrapping up its antitrust probe into major tech platforms, with eight experts opining at a hearing today on what Congress should do next about Silicon Valley’s power. What you’re likely to hear from the witnesses:
— Let the FTC/DOJ take care of it: That’ll likely be the line of thinking from Tad Lipsky, who was the FTC’s top competition staffer in the early days of the Trump administration and is now at George Mason University Law School. Lipsky, also a former Justice Department antitrust prosecutor under Reagan, is a frequent defender of U.S. antitrust law and the agencies. He advocates for increased funding for the FTC and DOJ and greater use of economics in antitrust, but largely leaving the law alone.
— Break ‘em up: Considering the title of her newest book (Break ‘Em Up), it should come as no surprise that Fordham’s Zephyr Teachout champions more antitrust intervention. Among her suggestions: put certain restrictions on tech platforms to prevent them from operating in overlapping areas, similar to the Depression-era banking law Glass-Steagall. The antitrust panel’s chair, Rep. David Cicilline (D-R.I.), has expressed interest in this idea.
— Treat them like utilities: Tech companies are our modern infrastructure and we should treat them as such, Demos President K. Sabeel Rahman told my colleague Leah, POLITICO’s antitrust guru. “These are the modern railroads, the telegraphs of yesteryear,” he said. One actor should not be allowed to control infrastructure everyone needs, said Rahman, who is also a prof at Brooklyn Law School. That could mean break-ups, greater regulations or creating public options, he said.
— Examine rule-making: One reason tech companies are so big is because of “network effects” — both companies and consumers want to be on the same platform as everyone else, which makes it harder for newcomers to break in. Interoperability, requiring different systems share data seamlessly, could reduce that advantage, Equitable Growth’s Michael Kades told Leah. Bill Baer, the DOJ’s top antitrust cop under Obama, said he’s also been thinking along those lines. “Antitrust law enforcement isn’t the only way to address problems,” he said, suggesting agencies propose “forward-looking rules” that promote competition without court cases.
— Make enforcement easier: Congress should “make antitrust enforcement easier, faster, cheaper and more fair,” Sally Hubbard of Open Markets, an anti-monopoly group, told Leah. Kades, who spent 20 years at the FTC, also pushed for changing some of the legal conclusions assumed by courts, saying that the government now would be hard-pressed to win the case that broke up AT&T in the 1980s.
RELEVANT FOOTNOTE: MESSENGER-INSTAGRAM INTEGRATION DRAWS CRITICISM — Facebook said Wednesday it has merged its Messenger with Instagram direct messages so users can talk across platforms — functionality the social network plans to extend to WhatsApp as well. Antitrust critics, including Open Markets’ Hubbard, have panned the move as an effort to entrench Facebook’s control over the apps at a time when competition authorities are considering breaking them apart. Individuals familiar with Facebook’s thinking said insinuations that the messaging integrations are intended to stymie antitrust enforcement are off-base.
ANOTHER RELEVANT FOOTNOTE: GATEKEEPER NO-NO’S — POLITICO’S Laura Kayali, who is based in Europe, got a copy of the European Commission’s draft of banned behaviors and obligations for major tech companies under the forthcoming Digital Services Act. The Commission proposes a “blacklist” of prohibited conduct and a “graylist” for when regulators may want to intervene against gatekeeper platforms — which include large marketplaces, app stores, social networks, online search engines, operating systems and cloud services.
— The banned practices would include: Sharing data between services; preferential ranking in search results; pre-installing or requiring pre-installing of their own apps; and restricting businesses from offering cheaper prices on other websites. Google, Facebook and Amazon have all drawn complaints for these practices.
MORE HILL ACTION: SENATE COMMERCE VOTES ON TECH CEO SUBPOENA — “The Trump administration is pressuring Senate Republicans to ratchet up scrutiny of social media companies it sees as biased against conservatives in the run-up to the November election, people familiar with the conversations say,” Cristiano and John report in a new dispatch.
— The effort’s paying off: “Senate Commerce Chair Roger Wicker is having his committee vote Thursday on whether to issue subpoenas to the CEOs of Facebook, Twitter and Google to testify about how they police content on their platforms. That’s after the Mississippi Republican tried and failed last week to push through subpoenas that could have compelled the CEOs to testify with only a few days’ notice. Senate Judiciary Chair Lindsey Graham (R-S.C.), meanwhile, is holding a markup of new legislation on Thursday aimed at addressing allegations of an anti-conservative bias on social media.” More on that just below.
NEXT DOOR: GRAHAM’S SECTION 230, COPYRIGHT MASHUP BILL SET FOR VOTE — Senate Judiciary is today marking up a controversial bill by Chair Lindsey Graham that combines language on copyright reform with a GOP-led proposal to narrow tech companies’ liability protections. The Online Content Policy Modernization Act, S. 4632 (116) — which borrows provisions from a separate Section 230 bill targeting allegations of anti-GOP bias on social media — is expected to face widespread opposition from Democrats. But it’s also drawing rebukes from copyright reform backers, who are balking at this latest amalgamation.
— Making their CASE: The copyright language in Graham’s bill mirrors the CASE Act, a proposal to expand copyright owners’ ability to file infringement claims. That bill overwhelmingly passed the House in 2019 but has not advanced out of committee in the Senate. One industry group that backs it — ACT | The App Association — is against combining the bill with language on Section 230. Communications Director Ashley Durkin-Rixey told MT “the inclusion of it as part of legislation targeting Section 230 liability overshadows the CASE Act’s significant proposed reforms that increase the viable options for app developers to enforce their IP rights.”
— What to watch for: Dems are likely to reject Graham’s new bill out-of-hand over its provisions targeting alleged bias. But the committee has large factions of both GOP CASE Act supporters — including Sens. Thom Tillis (N.C.), Chuck Grassley (Iowa) and John Cornyn (Texas) — and conservative Section 230 hawks — including Sens. Ted Cruz (Texas), Josh Hawley (Mo.) and Marsha Blackburn (Tenn.). Will a bill coupling the issues get enough yays?
— In other 230 news: A bipartisan House companion to Graham’s EARN It Act, S. 3398 (116), a bill to open up internet companies to more liability for hosting child porn, was introduced Wednesday by Reps. Sylvia Garcia of Texas and Ann Wagner of Missouri. EARN It is the only bill targeting Section 230 to advance out of a committee in either chamber this Congress.
SO LONG, FAREWELL: O’RIELLY TO DEPART FCC FOR GOOD — GOP Commissioner Mike O’Rielly, who has been at the FCC since 2013, announced during Wednesday’s commission meeting that he does “not seek for anyone to pursue my continued service at the commision beyond my current term.” President Donald Trump had originally renominated him to a new five-year term but yanked that nomination this summer, meaning he’ll have to leave by year’s end.
— O’Rielly confirmed he views his FCC service as “coming to an end regardless of the presidential election,” seemingly dismissing interest in returning to a potential open GOP seat next year under a possible Biden administration (which would likely heed GOP recommendations from Capitol Hill, where O’Rielly remains popular). He didn’t specify when, precisely, he would step down but touted what he considered his key priorities from his time at the FCC, such as freeing more licensed and unlicensed airwaves for the wireless industry and restricting the spending of 911 consumer fees to 911 services.
— FCC Chair Ajit Pai and his colleagues of both parties thanked O’Rielly for his record. Speculation is swirling over whether the Senate can confirm his replacement, nominee Nathan Simington, with scant legislative days left on the calendar this year.
Evan Engstrom, former executive director at Engine, is joining Milltown Partners, where he’ll continue to work on tech policy issues. … Iverna McGowan, who worked most recently in the U.N. Human Rights Office and in 2017 was named by POLITICO as one of the top women shaping Brussels, is joining the Center for Democracy & Technology to lead the group’s Europe office.
The Consumer Technology Association and the Connected Health Initiative launched the Health Equity and Access Leadership (HEAL) Coalition to find ways to better use tech to address health disparities that have been exacerbated by the pandemic; Google and Microsoft are among the leaders of the initiative. … The FCC announced the winners of the agency’s annual Excellence in Economic Analysis and Excellence in Engineering Awards; more here on this year’s recipients.
Plus: “Joe Biden’s transition team named Jessica Hertz, until recently a Facebook executive focused on government regulations, as its general counsel on Wednesday,” POLITICO reports.
Warehouse workers’ pandemic struggle: “Amazon’s lack of transparency, combined with the lack of federal protections for U.S. workers who contract infectious diseases in the workplace, make it almost impossible to track the spread of Covid-19 at one of America’s largest employers during a coronavirus-led boom in online retail,” NBC News details in an investigative report.
TikTok timeline: “TikTok and the Trump administration are proposing to head back to court in November to battle over President Donald Trump’s executive order seeking to force the company to sell off its U.S. operations,” Cristiano reports, “with the video-sharing service expected to request a temporary halt against it.”
And a TikTok plot twist, ICYMI: “A mid-level Facebook manager, of all people, took credit for [President Trump’s] Tulsa-rally debacle widely attributed to TikTok teens,” Vanity Fair reports — “another twist in Trump’s social media showdown raising eyebrows on Wall Street.”
Tech for good: WIRED’s November cover story looks at an effort in California to deploy new fire-modeling software to better prepare for future wildfires across the American west.
Eyeballs watching emoji: “China is preparing to launch an antitrust probe into Alphabet’s Google,” Reuters reports, “looking into allegations it has leveraged the dominance of its Android mobile operating system to stifle competition.”
Paging Bezos: More than a dozen privacy and civil rights groups are sending a letter calling on the CEO of Amazon, whose cloud services are supporting the U.S. election, “to disclose all instances of security breaches related to election data, the implications of such breaches, and the actions it took to address them.”
Tips, comments, suggestions? Send them along via email to our team: Bob King ([email protected], @bkingdc), Heidi Vogt ([email protected], @HeidiVogt), Nancy Scola ([email protected], @nancyscola), Steven Overly ([email protected], @stevenoverly), John Hendel ([email protected], @JohnHendel), Cristiano Lima ([email protected], @viaCristiano), Alexandra S. Levine ([email protected], @Ali_Lev), and Leah Nylen ([email protected], @leah_nylen).
TTYL.
