Tech Hearing Live: C.E.O.s Bezos, Zuckerberg, Cook and Pichai Face Congress
Tech Hearing Live: C.E.O.s Bezos, Zuckerberg, Cook and Pichai Face Congress
Representative David Cicilline, the chairman of the antitrust subcommittee, began the hearing on Wednesday with a broadside against the tech companies, saying their dominance harms the economy and leaves consumers with no choice but to use their products.
Mr. Cicilline has led the investigation into the tech giants for more than a year, and on Wednesday morning framed the four as singularly influential and powerful over many facets of American life.
“Any single action by one of these companies can affect hundreds of millions of us in profound and lasting ways,” Mr. Cicilline, a Rhode Island Democrat, said in his opening statement. “Simply put: They have too much power.”
Mr. Cicilline will be in control of many aspects of the hearing, including how many rounds of questions lawmakers get. That may allow him to extend lines of questioning in an attempt to dig deeper than an initial five minutes allows.
Mr. Cicilline, who used to be the mayor of Providence, has become a prominent foe of the technology platform from his perch as the top Democrat on the once-quiet subcommittee. For more than a year, his staff has led the investigation, conducting hundreds of hours of interviews and collecting 1.3 million documents. The team has grown to include Lina Khan, a legal scholar who wrote a major law review note on Amazon’s power, and Phillip Berenbroick, previously the policy director at the consumer group Public Knowledge.
Mr. Cicilline spent recent months negotiating to secure the appearance by the chief executives. It has not always been friendly. When the committee demanded that Mr. Bezos testify, Amazon responded with a noncommittal letter. Mr. Cicilline threatened to subpoena Mr. Bezos before the company agreed to make him available to answer the panel’s questions.
“Our founders would not bow before a king,” Mr. Cicilline said Wednesday. “Nor should we bow before the emperors of the online economy.”
Top Republicans on the committee immediately raised concerns that the tech giants are systemically suppressing conservative views, an unproven claim that has grown popular on the right and moved the hearing away from the central antitrust questions of the hearings.
Representative Jim Jordan of Ohio, the top Republican on the Judiciary Committee, spent his opening statements listing anecdotes where Republican officials had been subject to enforcement actions by the platforms’ rules. (He did not mention that conservative publications and figures routinely rank among the top performing pages on Facebook and other platforms.)
“I’ll just cut to the chase, Big Tech’s out to get conservatives,” said Mr. Jordan. He later accused the companies of “trying to impact elections” and “censoring conservatives.”
They expressed caution, though, about regulation.
“Big isn’t inherently bad,” said Representative James Sensenbrenner, a Wisconsin Republican.
Representative Ken Buck, a Republican of Colorado, said: “Our witnesses have taken ideas born out of a dorm room, a garage. You have enjoyed the freedom to succeed. I do not believe big is necessarily bad. In fact, big is often a force for good.”
The claims about conservative bias are a persistent, if largely unproven, gripe among Republicans. President Trump, Attorney General William P. Barr and lawmakers like Mr. Jordan and Senator Ted Cruz of Texas have all raised concerns that Facebook, Twitter, and YouTube purposely downplay or remove conservative voices on their sites.
The suspicions rise from the accurate perception that Silicon Valley is dominated by liberal-leaning workers. In November 2018, Facebook removed an ad by an anti-abortion group endorsing Republican Senator Marsha Blackburn of Tennessee. Facebook said it did so because an image on the ad that appeared to violate its community norms. That example and others have fueled suspicion of conservative censorship.
Mr. Trump recently issued an executive order curtailing safe harbors for internet companies in retaliation against his perceptions of bias. The order was issued after Twitter labeled a set of his tweets in late May for misinformation.
Jeff Bezos, Amazon’s founder and chief executive, introduced himself to Congress for the first time as a lucky and humble example of the success of American democracy.
Sitting stately in his office, Mr. Bezos said he was the son of a plucky mother and supportive, immigrant father who “fostered my curiosity and encouraged me to dream big,” an ethos he said he has brought to Amazon.
He said Amazon’s growth has benefited Americans and that the company has thrived because it thinks of them first, earning their trust by consistently offering low prices and delivering ontime.
“Customer obsession has driven our success,” he said.
Directly addressing antitrust concerns, he said Amazon holds a small share of American retail market, including physical retailers. “We compete against large players like Costco, Kroger and of course, Walmart, a company more than twice Amazon’s size,” he said.
And to address concerns that Amazon hurts the third-party sellers whose products make up the majority of sales on its site, Mr. Bezos said they have benefitted from Amazon’s growth and investment too. He said when Amazon decided two decades ago to invite third-party sellers to offer products on its retail website, Amazon thought that more selection would let both Amazon and the sellers thrive. “We were betting it was not a zero sum game,” he said. “Fortunately, we were right.”
While Mr. Bezos did not directly address his own wealth — now hovering around $180 billion — head on, he said Amazon has created “more jobs in the United States over the past decade than any other company,” and that it offers workers at least $15 an hour and “the best benefits,” such as health care and parental leave.
How often do tech titans repeat themselves? How many times will the chief executives fall back on buzzwords and catchphrases? And how frequently will they bring up their rivals (TikTok! Walmart! Each other!) to downplay their companies’ power?
To answer these questions, we’re keeping track of how often Jeff Bezos of Amazon, Sundar Pichai of Google, Tim Cook of Apple and Mark Zuckerberg of Facebook use certain arguments and phrases throughout the course of the antitrust hearing. Follow along with us here.
We Are Not That Big
Each time a C.E.O. argues that his company is not actually that powerful because its market share is small or its influence is limited.
We Are Good for America
Each time a C.E.O. boasts about how his company has added jobs, fueled economic growth, accelerated innovation or otherwise helped the country.
We Will Get Back to You
Each time a C.E.O. doesn’t directly answer a question, saying instead that he will respond after the company looks into the matter.
We Are Not the Ones to Worry About
Each time a C.E.O. tries to shift attention by citing a competitor or the specter of how China could dominate tech if their own companies are curtailed.
Many competitors to Google, Facebook, Apple and Amazon have been busy talking to House lawmakers for months about those companies’ power. And some deliberately spoke out this week to position themselves for how they would be portrayed in the hearing and to influence the questioning.
TikTok, the Chinese-owned video app, issued a statement from its chief executive, Kevin Mayer, on Wednesday morning. In it, he addressed how the app — which Facebook is likely to cite in the hearing as an example of how competition in social networking is thriving — has been dealing with scrutiny because of its Chinese ownership.
“We have received even more scrutiny due to the company’s Chinese origins,” Mr. Mayer said in the statement. “We accept this and embrace the challenge of giving peace of mind through greater transparency and accountability. We believe it is essential to show users, advertisers, creators and regulators that we are responsible and committed members of the American community that follows U.S. laws.”
He also pointed to Facebook’s willingness to launch “copycat products,” like Reels, a TikTok look-alike. Facebook has had a history of emulating competing products.
“Let’s focus our energies on fair and open competition in service of our consumers, rather than maligning attacks by our competitor — namely Facebook — disguised as patriotism and designed to put an end to our very presence in the U.S.,” Mr. Mayer said.
Other tech companies also seized on the hearing to air their thoughts. Tim Sweeney, chief executive of Epic Games, the Cary, N.C.-based maker of the hit game Fortnite, lashed out at Apple and Google for price gouging and unfair policies in what he called their “app store monopolies.”
“Both stores significantly obstruct competition,” Mr. Sweeney said in an interview on Tuesday. He particularly criticized Apple’s 30 percent fee on payments for digital goods, which he said made it difficult for smaller players to offer artists a better deal.
Apple has said the 30 percent commission it takes from many apps in its App Store is a standard fee. Mr. Sweeney called that argument “silly nonsense.” Epic’s version of an app store charges its developers a 12 percent fee.
Mr. Sweeney, who began programming on an Apple II Plus computer in 1982 and founded Epic nine years later, said he felt a responsibility to speak out.
“Every tech company that does business in this world is going to have to live with the power we give these other companies,” he said.
Congressional hearings usually involve witnesses appearing in dark suits, with their entourages sitting behind them and lawmakers questioning them from above as phalanxes of photographers snap pictures and videographers stream the proceedings from a cavernous room at the Capitol.
Not this time.
The C.E.O.s of Amazon, Apple, Facebook and Google are all appearing on Wednesday before a House subcommittee virtually because of the coronavirus pandemic. Remotely beaming into the hearing adds a wrinkle of digital complexity, with any note-passing from aides and underlings most likely happening off-camera.
And while many of the tech giants make their own video-calling software, none will be using their own tools. Instead, they will all be joining via Cisco’s Webex videoconferencing service.
Webex has been the go-to service for Congress since the pandemic began. It has been certified by the House’s administration committee for being secure and meeting “business and technical requirements,” a House administration spokesman, Peter Whippy, said.
In that time, Webex has been used for more than 100 congressional hearings, said Jean Rosauer, Webex’s head of government sector. Cisco added that it had experienced more than triple its normal volume of virtual meetings through Webex in recent months.
“Congressional hearings — such as the upcoming House Judiciary Committee hearing — have traditions, policies and procedures, and we had to ensure those could be conducted virtually and securely,” Ms. Rosauer said in a statement. She added that Cisco was “incredibly proud” to play a role in keeping Congress connected.
Members of Congress have been mocked for asking ridiculous questions in technology hearings like these. That might happen again today, but it won’t be entirely their fault.
These big tech companies intentionally make themselves hard to understand.
Few people outside these companies can truly examine how Amazon influences prices of products we buy on its site or at other retailers; or assess fears that Google funnels people to its own websites, Apple steers people to its own apps or Facebook peers into what we do online to squash its rivals. All of this is, by design, shrouded in secrecy and mystery.
Big Tech shouldn’t want it to stay that way. Even companies like Facebook and Google are asking for more government guidance and rules around thorny topics like protecting elections and preventing hate speech on their sites. That means that the public and the tech companies have a vested interest in making these fact-finding sessions as productive as possible.
You can sign up here for On Tech with Shira Ovide, a newsletter each weekday about how technology is reshaping our lives and world.
The tech giants are under investigation from numerous federal and state antitrust officials, as well as by the lawmakers holding today’s hearing.
The Justice Department’s investigation of Google appears to be the furthest along. The agency is expected to soon announce a case against Google, focusing on alleged antitrust violations in online advertising.
The Federal Trade Commission is preparing to depose Mark Zuckerberg, the chief executive of Facebook, and other top executives at the company for its investigation of the social network. That inquiry appears to focus on whether Facebook illegally maintained a monopoly in social networking by killing off competition through its acquisitions of Instagram and WhatsApp. That investigation may not wrap up before the end of the year.
Other investigations are moving forward, but not as swiftly as the Google investigation. The Justice Department is also investigating Apple’s power over the app store, along with state attorneys general. The agency has Facebook under review as well, looking at the company’s position in online advertising. But that investigation appears to be moving slowly.
State investigators have been looking into whether Amazon abuses its power over sellers on the tech giant’s site. The F.T.C. is also investigating Amazon, but that appears to be moving slowly.
The Trump administration asked the Federal Communications Commission this week to narrow its interpretation of a law that shields internet platforms like Facebook and YouTube from certain lawsuits over the content they host.
The request, which stems from an executive order President Trump signed in May, is part of a growing push by the president and his allies, who say that tech companies are removing or suppressing conservative content. Despite evidence that conservative sites and figures perform well online, the president, along with much of his conservative base, have repeatedly criticized the platforms over instances in which conservative content was removed or otherwise moderated for violating a platform’s rules.
In a petition on Monday, the Department of Commerce asked the commission to clarify that the law, known as Section 230, does not protect a platform when it moderates or highlights user content based on a “reasonably discernible viewpoint or message, without having been prompted to, asked to, or searched for by the user.” It would also limit the circumstances under which platforms are protected from liability over their users’ content.
Kayleigh McEnany, the White House spokeswoman, said in a statement on Wednesday morning that the president wants the F.C.C. “to clarify that Section 230 does not permit social media companies that alter or editorialize users’ speech to escape civil liability.”
Mr. Trump weighed in later on Twitter:
If Congress doesn’t bring fairness to Big Tech, which they should have done years ago, I will do it myself with Executive Orders. In Washington, it has been ALL TALK and NO ACTION for years, and the people of our Country are sick and tired of it!
— Donald J. Trump (@realDonaldTrump) July 29, 2020
The petition is now in the hands of the F.C.C., an independent agency currently led by a Republican chairman, Ajit Pai, who was appointed to the position by Mr. Trump. “The F.C.C. will carefully review the petition,” said Brian Hart, a spokesman for the commission.
After lawmakers collected hundreds of hours of interviews and obtained more than 1.3 million documents about Amazon, Apple, Facebook and Google, their chief executives will testify before Congress at 1 p.m. on Wednesday to defend their powerful businesses.
The captains of the New Gilded Age — Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook and Sundar Pichai of Google — will appear together before Congress for the first time to justify their business practices. Members of the House judiciary’s antitrust subcommittee have investigated the internet giants for more than a year on accusations that they have stifled rivals and harmed consumers. The exact contents of the documents they’ve collected are unknown, although they are said to include documents related to some of the companies’ acquisitions and internal communications among top executives.
It is set to be a bizarre spectacle, with four men who run companies worth nearly $5 trillion combined — and who include two of the world’s richest individuals — primed to argue that their businesses are not really that powerful after all.
And it will be a first in another way: Mr. Zuckerberg, Mr. Pichai, Mr. Bezos and Mr. Cook will all be testifying via videoconference, rather than rising side-by-side for a swearing-in at a witness table in Washington.
At the hearing, the 15 members of the antitrust subcommittee will have five minutes for each question. Representative David Cicilline, Democrat of Rhode Island and the chairman of the subcommittee, will control the number of rounds of questioning, potentially stretching the hearing into the evening.
The antitrust issues facing Apple, Facebook, Google and Amazon are complex and vastly different.
Amazon is accused of abusing its role as both a retailer and a platform hosting third-party sellers on its marketplace. Apple has been accused of unfairly using its clout over its App Store to block rivals and to force apps to pay high commissions. Rivals have said Facebook has a monopoly in social networking. Alphabet, the parent company of Google, is dealing with multiple antitrust allegations because of Google’s dominance in online advertising, search and smartphone software.
Democrats may also veer off the topic of antitrust and bring up concerns about misinformation on social media. Some Republicans are expected to sidetrack discussion with their concerns of liberal bias at the Silicon Valley companies and accusations that conservative voices are censored.
The tech industry is an engine of innovation, job creation and American economic prowess. Competition is flourishing, and just a click away. Sure, we do well, but consumers are the big winners.
That was the gist of Bill Gates’s testimony before a Senate panel more than two decades ago. And it’s a safe bet the same themes will feature prominently when the leaders of Amazon, Apple, Facebook and Google testify on Wednesday.
There are differences, but this week’s appearance by tech executives is reminiscent of the congressional grilling Microsoft’s chief faced 22 years ago.
In 1998, the spotlight was squarely on Mr. Gates, co-founder of Microsoft, the tech behemoth of the personal computer era. This time, the leaders of four big technology companies will be in the dock, appearing remotely because of a pandemic.
Today, more issues are in play. In the late 1990s, the concern was that Microsoft would use its dominance in the PC market to stifle internet upstarts. The sheer market muscle of today’s tech giants is a worry, but so is the role they play broadly in commerce and communication, influencing public opinion and politics.
When Mr. Gates testified, a formal investigation of Microsoft by federal regulators and dozens of states was well underway. The same is true now for Google and Facebook, while Amazon and Apple are also facing antitrust scrutiny.
There can be gotcha moments. Under pointed questioning, Mr. Gates rhetorically bobbed and weaved, refusing to use the M-word: monopoly.
But when Jim Barksdale, head of Netscape, the internet company most in Microsoft’s sights, testified that day, he asked the spectators to raise their hands if they used a PC.
About three-quarters of the room did. Then, how many of them used Microsoft’s Windows operating system? Almost the same number of hands flew up again.
“That,” Mr. Barksdale said, “is a monopoly.”