Wednesday 29 July 2020 9:35 pm

Big Tech vs Congress live: Facebook, Google, Apple and Amazon face Washington grilling

Welcome to City A.M.’s Big Tech vs Congress live blog. Please refresh this page for live updates.

Big Tech faces its day of reckoning today as the world’s four biggest tech moguls appear before the US Congress in Washington to face a grilling over their companies’ size and power.

Facebook’s Mark Zuckerberg, Amazon’s Jeff Bezos, Google’s Sundar Pichai and Apple’s Tim Cook are answering questions from the House judiciary antitrust subcommittee, as a US government panel caps its year-long investigation of market dominance in the tech industry.

9:25 Zuckerberg under fire again over Snapchat bids

The committee comes back to Zuckerberg for more questions on Facebook’s history of acquisitions.

He is asked whether he ever threatened Snapchat owner Evan Spiegel while attempting to buy the photo-messaging app.

Earlier, the committee shared documents from Instagram founder Kevin Systrom which said the Instagram founder had felt threatened during talks with Facebook.

Zuckerberg says that he cannot remember the conversations.

9:06 Virtual assistant Alexa under microscope

Democrat Jamie Raskin follows up with a raft of questions on Amazon’s Echo smart speaker system, asking whether it is sold for below its cost price.

No, says Bezos, but he adds that it is often on sale, and thus may be below its cost price.

Raskin then asks whether virtual assistant Alexa has ever been trained to promote Amazon products.

Bezos responds that it “wouldn’t surprise” him if it did “sometimes promote certain products”.

8:54 Facebook under fire for ‘threatening’ competitors

Back to Jayapal, who asks Zuckerberg whether Facebook has ever taken steps to prevent competitors gaining a market foothold by copying them.

She follows up, asking whether it has ever threatened to copy a competitor’s products while buying them.

She cites the example of Facebook Camera, which it was building during the acquisition of Instagram, and asks whether Facebook had threatened the firm using it, as the latter’s founder Kevin Systrom alleged in committee testimony.

Zuckerberg says he disagrees with the characterisation.

“It was clear that this was a space that we were going to compete in one way or another. I don’t view those conversations as a threat in any way.”

8.42pm Amazon treats third party sellers like a ‘drug dealer’

The first round of questioning concludes, and chairman Cicilline takes over proceedings.

He asks Bezos why Amazon refers to its third party sellers as “internal competitors”, as suggested by internal documents.

He cites one such seller who likened Amazon to a “drug dealer”, ultimately causing the independent seller’s downfall.

Bezos says that Amazon does its best for consumers.

Ciciline hits back, asking why a small company would work with Amazon if it could use its data to undercut prices and drive smaller players out of business.

8.31pm Zuckerberg grilled over acquisition ‘land grab’

Joe Neguse, the Colorado Democrat, zones in on Facebook’s acquisition strategy, citing an employee’s description of it as a “land grab”.

Neguse says that Facebook’s purchase of apps such as Instagram and Whatsapp over the last year had made it a monopoly.

“You used your market power to purchase or replicate the competition”, he says. “We have a word for that: a monopoly”.

Zuckerberg demurs.

8.21pm Jordan kicks off at fellow committee member

Democratic congresswoman Mary Scanlon takes over the questioning, saying she will focus on competition issues rather than “fringe conspiracy theories”.

Jim Jordan doesn’t like it, lashing out at Scanlon’s comments.

It all gets a bit heated and chair Cicilline has to step in to calm things down.

“Put your mask back on”, he tells Jordan.

8.10pm Google questioned over anti-conservative bias

Florida Republican Greg Steube has followed up on fellow Republican Jim Jordan’s comments earlier on Google’s alleged anti-conservative bias.

He said that campaign emails from conservative Republicans were now being sent to supporters’ junk boxes on Gmail, rather than their personal email. He names his father as one such case.

Pichai said the platform’s algorithm separates personal emails from general ones like campaign emails.

“Nothing in our algorithm has anything to do with ideology”, he says. “We approach our work in a non-partisan way”.

Democrat Val Demings says the same thing has happened to her.

Jordan then returned to ask Pichai to guarantee Google would not use its algorithm to help Democratic candidate Joe Biden in the autumn’s election.

He accused Google of electioneering in 2016, citing emails that suggested they had done so in key swing states.

Pichai says Google complied with election laws in 2016 and would do again in 2020.

7.57pm Bezos gets his first grilling

Jayapal cited an April newspaper report which said Amazon uses data it gains from third-party sellers on its marketplace to inform its own product strategy.

She added that the committee’s own investigation had found Amazon uses aggregate data to gain access to highly detailed information on smaller product categories so it can exploit it for its own competing products.

Bezos said he was looking into the report “carefully”, but that it had “not yet gotten to the bottom of it”.

7.40pm Another recess for technical issues

We’ve had to take a break while Congress works out a technical issue with the feed of one of the witnesses.

So far we’ve heard from Pichai, Cook and Zuckerberg. Not one question has been directed at Bezos, despite it being his first time in front of politicians ever.

He was last seen having a snack, with reports suggesting it was his feed that was experiencing issues.

7.26pm Apple’s App Store in focus

Representative Johnson asked Apple’s Tim Cook whether it treats all app developers the same, and whether there were any mechanisms in place to prevent it from raising its own App Store commission fees to exorbitant rates.

Cook said Apple treats all app submissions the same, regardless of the size of the business.

He added that Apple faces “a street fight for market share in the smartphone business”, and therefore seeks to appeal to developers in the same way as it does consumers.

These are the same concerns as an ongoing EU investigation into Apple that raises issues with the fact that all apps on Apple’s store are required to use Apple’s payment processing service, with no option but to pay the tech firm’s 30 per cent commission fee.

7.07pm Misinformation on coronavirus

Ranking member John Sensenbrenner asked Mark Zuckerberg why Facebook took down a video posted by Donald Trump Jr. that advocated for the use of hydroxychloroquine as a treatment for Covid-19.

The video in question was in fact posted on Twitter.

However Zuckerberg said Facebook’s policy would be to take down any content that promoted a “proven” treatment for Covid-19, when no drug has yet been found and widely established by a variety of sources.

6.56pm Questioning begins

Cicilline starts off by questioning Google boss Sundar Pichai, saying the committee’s investigation showed it stole other web pages’ content from competitors to better its own search business.

He cited examples such as showing Yelp reviews on Google rather than directing users to open Yelp’s website themselves, without gaining consent from Yelp to show that data.

Cicilline also likened Google to a “walled garden” around the internet, privileging its own websites — with 60 per cent of searches starting on Google ending on a site related to Google.

Pichai said Google sees “vigorous competition” from other websites, and that it does not suppress rival content.

6.31pm Republican representatives lay into Big Tech for bias

Republican representative Jim Jordan used his opening statement to lay into the tech companies present for allegedly censoring conservative views on their platforms.

Meanwhile other politicians on the committee took differing approaches: some lambasted the companies for abusing their size to harm rivals, while others said being a big company is “not inherently bad”.

6.05pm And we’re back

The subcommittee chair is now opening the session. First we’ll hear opening remarks from each of the chief executives, which were published online this morning ahead of the hearing.

Read our analysis and coverage of those remarks here:

Read more: Zuckerberg defends Facebook: ‘Companies aren’t bad just because they’re big’

Setting a precedent for how this hearing might be about to go, chair David Cicilline said: “Our founders would not bow before a king, nor should we bow before the emperors of the online economy.”

5.30pm: President Trump weighs in

US President Donald J Trump has given his two cents before Congress begins questioning. He said if they aren’t tough enough, he’ll start taking matters into his own hands.

5.20pm: The hearing has been delayed slightly

Due to a logistical issue, the hearing is set to be delayed by 30 to 45 minutes. It is expected that proceedings will now begin around 1pm EST (6pm BST).

5pm: And we’re (almost) off!

Lawmakers are starting to enter the room at the US House judiciary antitrust subcommittee hearing, while the tech chief executives will all be appearing via videolink.

While each of their respective companies owns and operates a form of video-conferencing software, all the bosses will be using Cisco’s Webex.

During the hearing, the 15 members of the antitrust subcommittee will have five minutes for each question. It’s up to the chair to decide how many rounds of questioning there will be, leaving the duration of the meeting open-ended.

4pm: What to expect from each tech boss

Amazon

Jeff Bezos, currently the richest person in the world, is set to make the case for Amazon’s large contribution to the US economy over the last decade. The e-commerce giant, worth more than $1.5 trillion ($1.2 trillion), has injected more than $270bn into the US over the last 10 years and created more than 270,000 jobs.

The tech titan has seen soaring success throughout the pandemic, with people around the world turning to their screens for shopping, grocery and everyday needs during months of lockdown. 

Bezos will emphasise the company’s dedication to getting its products to customers, which he says are roles that cannot be outsourced “to China or anywhere else”.

He will also draw on the so-called American Dream and highlight his humble roots, having founded Amazon in his Seattle garage in 1994.

Facebook

Mark Zuckerberg will follow suit, arguing that he nurtured the billion-dollar company “the American way, by starting out with nothing and providing products that people find valuable”.

Zuckerberg, currently the fourth-richest person in the world, will tell Congress that Facebook faces competition from large rivals. 

“We compete against the companies appearing at this hearing, plus many others that sell advertising and connect people. We also compete globally, including against companies that have access to markets that we aren’t in,” he will say.

Zuckerberg will also face a grilling over Facebook’s acquisition of WhatsApp and Instagram, following calls for the US government to break up of the social media giant over competition concerns.

Zuckerberg will tell the House committee that the popular apps are better off under the corporate umbrella of Facebook. “Facebook has made Instagram and WhatsApp successful as part of our family of apps,” Zuckerberg will say, according to in pre-prepared testimony.

Apple

Tim Cook will tell the committee that Apple “does not have a dominant market share in any market where we do business. That is not just true for iPhone, it is true for any product category”.

He will also defend the company’s App Store, and claim that its fees for developers are “comparable to or lower” than those offered by its rivals.

“They are vastly lower that the 50 to 70 per cent that software developers paid to distribute their work before we launched the App Store,” Cook will say.

Google

Google chief executive Sundar Pichai is set to address concerns that the company’s overwhelming share of the search market has driven up prices for digital adverts.

According to prepared statements released ahead of the hearing, Pichai will argue that he remains concerned about Google staying relevant as younger generations increasingly turn to Twitter, Tiktok and other platforms for information.

“Google’s continued success is not guaranteed,” he will say. “You can ask Alexa a question from your kitchen; read your news on Twitter; ask friends for information via WhatsApp; and get recommendations on Snapchat or Pinterest.

“When searching for products online, you may be visiting Amazon, eBay, Walmart, or any one of a number of e-commerce providers, where most online shopping queries happen.”

What is this all about?

The hearing marks a seminal moment for the global technology stage, following mounting criticism that the world’s biggest tech firms do not do enough to protect their customers. Former regulators have described the committee meeting as “tech’s Big Tobacco moment”. 

Senators are set to scrutinise the four tech bosses over whether they actively work to harm and eliminate smaller rivals.

The technology chiefs, who will give testimony via video link due to social distancing measures, plan to tell the antitrust hearing that they face intense competition from each other and from other rivals. 

The hotly-anticipated hearing was due to take place on Monday, but was postponed because Representative John Lewis will be lying in state until this evening.

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