In July, a report indicated that major US technology companies like Apple, Google, Facebook, and Amazon were being investigated by the US Department of Justice. For possible violations of the antitrust law. The truth of the matter is that these companies have become so large as to dominate segments of the technology sector, including search (Google), social networks (Facebook) and retail (Amazon).
The US House of Representatives apparently began its investigation asking that executives from leading technology companies deliver financial and other documents. Internal e-mails were also requested on acquisitions and other problems dating back over ten years by Apple CEO Tim Cook; Jeff Bezos, CEO of Amazon; Larry Page, CEO of Alphabet, parent of Google; and Facebook CEO Mark Zuckerberg. The leaders of the four companies testified before the antitrust subcommittee of the House of Representatives in July. Today’s report indicates that the Chamber is analyzing Google’s acquisition of YouTube in 2006, its purchase of Android a year earlier and other transactions that have led DoubleClick and AdMob to Google. Even the acquisitions made by Amazon are under the microscope, as are the Facebook purchases of Instagram and WhatsApp.
Google was fined $5 billion last year by the European Commission for antitrust violations
Apple is under investigation because of the 30% cut in revenue from the App Store that is earned by itself. The so-called “Apple tax” has led consumers to pay higher prices for apps, according to the plaintiffs in a collective action lawsuit brought against Apple in 2011. Because Apple does not allow iOS users to download apps from third-party app stores. (as Google allows on Android), the plaintiffs claim that this behavior is anti-competitive and forces them to pay higher prices for apps and games. Last May, the US Supreme Court ruled in a 5-4 decision that the lawsuit can continue to be judged because most consider Apple the distributor of apps and games for iOS users rather than an “intermediary” like Apple said. This is similar to the complaint presented to the EU Competition Commission by the Spotify music transmitter. According to reports, the commission investigated Apple.
Apple has responded by stating that it is only reducing 15% of 680,000 of the over 100 million Spotify premium users. First, Apple notes that its cut of subscriptions paid through its app payment system (iAP) drops from 30% to 15% after the first year. Furthermore, it is noted that after 2016, Spotify members could no longer switch from free advertising service to a premium paid subscription via the App Store, which limits the number of Spotify subscribers interested.
The House wants information from each of the top executives of the four companies concerning their company’s market share and major commercial competitors. The Chamber also wants to meet the main customers of the technology company for certain products. While this survey appears to be more concerned about Google’s past acquisitions, the European company was fined $5 billion last year by the European Commission for violating antitrust laws forcing Android phone manufacturers to use Google Search and the Chrome browser on their phones. Furthermore, it was discovered that Google had paid producers to install Google Search on their devices. In addition to the fine, Google was forced to put a page on Android phones that offered users the ability to select a different browser and search engine instead of Chrome and Google, respectively.
In general, it would seem that the House is more interested in the size and domination of the market share of the four technology giants. The DOJ or other agencies could investigate separately other monopolistic behaviors.
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