Jul 28, 2020

Axios Login

Wishing you a day full of peace, joy and (stops to look at Twitter). Oh, come on, that's just asinine. Sorry, I was wishing you something, I think.

Today's Login is 1,268 words, a 5-minute read.

1 big thing: Tech defenders, critics line up shots ahead of hearing

Illustration: Sarah Grillo/Axios

Depending who you ask, the giants of tech either preside benignly over healthily competitive markets, or they ruthlessly exploit their power to crush upstarts and challengers.

The big picture: Which conclusion you draw will depend upon where you dip into the slew of new studies, polls and policies the firms and their critics are unleashing ahead of Wednesday's historic congressional testimony by the CEOs of Facebook, Google, Amazon and Apple, Axios' Ashley Gold reports.

What's happening: The companies have taken steps leading up to Wednesday's House Judiciary antitrust subcommittee hearing to try to prove they're not stifling competition.

Apple last week unveiled a commissioned study concluding the company doesn't operate its App Store differently from other online marketplaces.

  • Apple bars most app developers from bypassing the up-to-30% cut it takes from in-app subscriptions and purchases. The study found that other marketplaces, including the Google Play Store, impose comparable rules, which some developers complain amount to an abuse of power.
  • Apple's pre-hearing maneuvering appears aimed squarely at the chairman of the antitrust panel, Rep. David Cicilline, who has called Apple's 30% tax "highway robbery, basically."

Facebook points to a new study on the growing app ecosystem showing people use about 41 apps on their phone each month, arguing that consumers have more choice than ever.

  • "New companies are succeeding with innovative apps that meet needs people might not even know they have," said Ime Archibong, Facebook's head of new product experimentation.

Google announced it will no longer charge a commission to sellers on Google Shopping, which it's also opening to third-party payment platforms like PayPal and Shopify.

  • Google could point to the move as a sign it's better at encouraging competition than Amazon and has made strides in addressing competition issues with its e-commerce platform. In 2017, the European Commission fined Google $2.7 billion for abusing its search dominance to send customers to Google Shopping.

Amazon has been quieter, though it did already release a commissioned study touting its benefits to small business back in January.

Big Tech's trade groups and other allies are rolling out their defenses, too.

  • Tech trade group NetChoice released a report "debunking" the antitrust case against Facebook, touting its competition in the digital advertising and social media markets from companies like YouTube, Snapchat, Twitter, Pinterest and TikTok and major digital advertising competitors like Google, Verizon, AT&T and Amazon.

The other side: Big Tech’s critics have also been lining up.

  • new paper out Friday from the American Economic Liberties Project, which takes funding from eBay founder Pierre Omidyar, accuses Amazon of unfair practices ranging from predatory pricing to favoring its own products, and calls for the company to be regulated and broken up.

Yes, but: Lawmakers say they don't need outside help.

  • Senior committee aides told reporters they're already well prepared, having pored over 1.3 million documents from tech companies and 385 hours of calls, meetings and briefings as part of a year-long antitrust investigation.

Ashley has more here.

2. Scoop: Facebook boycotters lobby lawmakers on antitrust

Illustration: Sarah Grillo/Axios

Organizers of the #StopHateforProfit advertising boycott say Facebook's ability to withstand their campaign suggests a competition problem and are urging House antitrust investigators to press CEO Mark Zuckerberg on the issue Wednesday, Axios' Sara Fischer reports.

Why it matters: If the boycott isn't enough to get Facebook and other social media platforms to take firmer action against hate speech, its organizers are hoping pressure from Washington will get results.

What's happening: Common Sense Media, a consumer tech advocacy group, has written letters to the House Judiciary antitrust subcommittee on behalf of the boycott organizers, which also include groups like the NAACP, Color for Change and the Anti-Defamation League.

Details: In a letter written to all committee members and obtained by Axios, Common Sense tells lawmakers the boycott campaign has "highlighted how much control Facebook has over online advertising."

  • The letter is the second of two notes sent to lawmakers in the past week — one sent last Tuesday and the second one Monday afternoon.
  • It provides sample questions that they want lawmakers to ask Zuckerberg, such as, "[I]s it accurate that you have said that advertisers will be back soon? Does this mean they have no real alternative?" Zuckerberg has reportedly told employees as much.
  • Committee members have confirmed receipt of the letters and say they appreciate the input from the campaign, sources tell Axios. Some of the groups leading the boycott, including the NAACP, have individually been in touch with lawmakers regarding the hearing, sources say.

"Facebook has enough power that it believes it is effectively immune to ad boycotts, massive privacy violations, and other scandals," Common Sense CEO Jim Steyer said in a call with Axios.

The other side: "There's no place for hate on our services and we've made it clear there is nothing more important than that," a Facebook spokesperson tells Axios.

The big picture: The #StopHateforProfit boycott has escalated quickly to encompass roughly 1,000 advertisers.

  • Tensions between the boycotters and the tech giant haven't improved since the company's disastrous meeting with civil rights leaders last month, Steyer says, and Common Sense hasn't been in touch with Facebook since.

Meanwhile: Texas is investigating Facebook for possibly running afoul of state laws on the collection of biometric data, per documents uncovered by a tech watchdog group, Ashley scooped Monday.

3. Charted: Tech companies' work from home plans
Data: Axios reporting, company officials; Table: Naema Ahmed/Axios

With Google's announcement on Monday it will let most employees work from home through mid-2021, here is a look at what the other big tech companies have (or in some cases haven't) said about their plans.

Why it matters: Nobody knows when it will be safe for a mass return to the office. Telling workers when they can expect to remain working from home allows them to make plans, especially with many school districts starting the year with remote learning.

Go deeper: Tech hits the brakes on office reopenings

4. Tech liability fight comes back into focus

The debate in Washington is heating up again this week over whether and how to update Section 230 of the Communications Decency Act, which immunizes online platforms against lawsuits over moderation practices and user-posted content, Ashley reports.

Why it matters: Chipping away at the shield may be a more potent threat to the tech industry than stepped-up antitrust enforcement. It can be done in one fell legislative swoop — as happened two years ago — rather than requiring lengthy, uncertain court proceedings.

Driving the news:

  • The Senate Commerce internet and communications subcommittee today holds a hearing on a bipartisan bill to add transparency requirements to Section 230. Witnesses include former Rep. Chris Cox, who co-wrote the law in the mid-1990s with Sen. Ron Wyden.
  • GOP Sen. Josh Hawley, a vocal Section 230 critic, unveiled a new bill Tuesday to take away immunity from tech companies that track users around the web and target ads at them based on their activity.
  • A Commerce Department agency Monday asked the Federal Communications Commission to start the process of writing regulations to limit the circumstances in which Section 230 protections apply. The Commerce petition stems from President Trump's push to narrow Section 230 by executive order.
  • Tech trade group the Internet Association on Monday issued findings after reviewing more than 500 lawsuits in which Section 230 was used as a defense. In most of those cases, judges didn't rely on Section 230 in making a ruling, IA found.

Be smart: The fight over Section 230 is less about its merit and efficacy as a legal defense and more about finding a way to hold tech accountable for perceived failures.

Our thought bubble: Legislation taking aim at Section 230 is less of a moonshot than seeking to break up tech giants. But it still may be a tall order to move any major tech legislation before the November election.

5. Take Note

On Tap

  • Earnings reports include eBay and AMD.

Trading Places

  • Tinder named former CBS Interactive head Jim Lanzone as its new CEO.
  • After confirming further manufacturing delays last week for its next-generation processors, Intel announced a reorganization Monday that will see Murthy Renduchintala leave the company. Renduchintala, a former Qualcomm executive, joined Intel in 2015 and was seen as a potential CEO candidate when Brian Krzanich resigned in 2018.


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