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Big Tech is in a ‘serious monopoly moment’

Facebook recruiting partners for crypto payments, Project Libra: WSJ


Big Tech is in a ‘serious monopoly moment’


The House Judiciary investigation into Big Tech aims to look into how to prevent Silicon Valley giants from thwarting competition, David Cicilline, chairman of the antitrust subcommittee, told CNBC on Wednesday.

“These are huge monopolies and we want to make sure we’re doing everything we can to make markets work,” the Rhode Island Democrat said on “Squawk Box.” “These are markets that are not working properly. We’re in this very serious monopoly moment.”

The House antitrust subcommittee held a hearing Tuesday on anti-competitive practices in technology, looking at ways that companies such as Facebook and Alphabet’s Google have changed the news media landscape. “This is the first significant antitrust investigation undertaken by Congress in decades,” Cicilline said at Tuesday’s hearing.

Cicilline and Republican Rep. Doug Collins from Georgia co-sponsored legislation that would allow local news organizations to negotiate with internet platforms.

There’s a “number of big challenges” that are harming consumers, Cicilline said Wednesday on CNBC, including “serious breaches of privacy” and “loss of control of data.”

Facebook has been working to regain user trust after last year’s Cambridge Analytica data misuse scandal, which hit on the heels of the disclosure that Russian operatives used the social network to try to influence the 2016 presidential election.

Referring to Facebook and Google, an Alphabet analyst at CFRA Research, told CNBC earlier Wednesday, “Both of those companies, directly impact the outcomes of elections and things politicians take very personally.” CFRA’s John Freeman said that’s the difference between today’s tech outcry and Microsoft’s clash with the government over its internet browser in the 1990s and early 2000s.

Big tech companies nowadays are facing increasing scrutiny as politicians, both Democrats and Republicans, are beginning to look into their practices and potential hold on the markets. Federal investigations are reportedly underway or being considered by the Justice Department and the Federal Trade Commission.

Meanwhile, state attorneys general on Wednesday plan to meet with FTC officials in Omaha, Nebraska, to talk about consumer protection issues and competition matters as they consider probes. Many of the tech companies have been generally quiet as regulators saber rattle.

Cicilline said his panel’s investigation is not looking into single companies, but it wants to “make sure we’re understanding how markets are working to develop solutions.”

On the Republican side, House Minority Leader Kevin McCarthy said Wednesday on “Squawk Box” that Democrats are trying to “create another utility company” rather than focus on privacy and innovation.

In a CNBC interview Monday, President Donald Trump accused Facebook and Google of colluding with Democrats against him. “I can tell you they discriminate against me,” he added, reiterating a view among conservatives that tech companies are biased against Republicans.

Many of the candidates seeking the Democratic presidential nomination in 2020, including Sens. Bernie Sanders and Elizabeth Warren, are pushing for breaking up major tech companies.

WATCH: House GOP Leader Kevin McCarthy on Big Tech


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