Bill to ban Amazon self-preference, Google clears obstacle in Senate

The measure that cleared the Senate would address issues raised by The Markup’s multiple investigations

By: Aaron Sankin

Estimated reading time: 4 minutes

The Senate Judiciary Committee on Thursday gave its approval to the first major legislative effort to prevent the biggest tech platforms from getting an edge over competing companies using their websites, primarily Google, Amazon, Facebook and Apple.

The bill is one of many proposed after a landmark inquiry into the power of tech giants in which The Markup’s work was repeatedly cited by lawmakers. Passing by a margin of 16 to 6 against, the US Online Innovation and Choice Act would prevent big tech companies from using their market dominance to favor their own products and services over those offered by others. other companies on their platforms.

“We all use Google and Amazon to make purchases. Consumers have no idea that Google and Amazon don’t give them the cheapest or the best products. They give them the products and prefer the products that give them the most money. money,” said Sen. Richard Blumenthal (D-CT), co-sponsor of the legislation, during the hearing. “We need this bill to help consumers and competitors.”

A 2021 markup survey showed that Amazon consistently listed its private label and exclusive brand products higher in search results than items from competitors that had better customer ratings and higher sales. This survey found that simply knowing whether a product was Amazon-branded or sold exclusively on Amazon could predict whether Amazon would list it at the top of search results about 70% of the time.

The previous year, The Markup reported that Google had given its properties a preference in search results. This survey, which examined more than 15,000 Google search queries, found that Google gave itself 41% of the space on the first page of search results.

The proposed legislation, which is now passing through the full Senate, only applies to companies with more than 50 million monthly active users, or 100,000 monthly business users, a market capitalization greater than $550 billion, and that are “an essential business partner for the sale”. or the provision of any product or service offered on or directly related to the online platform. The Department of Justice and the Federal Trade Commission would also have the ability to designate a platform as subject to the rule.

Amazon Flex Bill seeking to ban Amazon self-preference, Google clears Senate hurdle

Sen. Mike Lee (R-UT), a senior member of the Senate Antitrust Subcommittee, was one of six senators who voted against the bill. “I fear that, in a rather perverse and even unintended way, this could entrench the four companies it is intended for by creating a strong incentive to stop doing business with third parties,” Lee said during the hearing. “It could crush thousands of small businesses and could actually worsen the state of competition in online markets.”

The computer and communications industry association, which represents Amazon, Apple, Facebook and Google, has launched a campaign against the legislation. Titled “Don’t Break What Works,” the campaign says that, if passed, the legislation could end things like free shipping through Amazon Prime or result in charges for previously free products like Google Maps.

According to data from OpenSecrets, Amazon and Meta, Facebook’s parent company, spent the most money lobbying any individual company over the past year.

Some smaller tech companies have urged the government to act.

A group of small and medium-sized business leaders, including the CEOs of Sonos and Yelp, met with officials at the White House on Wednesday to express their frustration with how big tech companies wield market power. “Among these challenges, several participants described issues with large platforms both operating a marketplace and selling products in the marketplace, including concerns that dominant platforms rank their own products and services above those independent sellers who rely on them to reach customers,” read a statement from the White House summarizing the event.

A bipartisan group of lawmakers, led by Rep. David Cicilline (D-RI) and Rep. Ken Buck (R-CO), introduced an equivalent of that bill in the House of Representatives last year. This legislation has been passed by the House Judiciary Committee, but has not yet been put to the full House for a vote.

This article originally appeared on The Markup and has been republished under Creative Commons Attribution-NonCommercial-NoDerivatives Licence.

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Last updated February 12, 2022.

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