Brett Goncher (brett.goncher@gmail.com) is a contributing writer for SCCE on various topics, including anti-money laundering, anti-trust, trade regulations, and financial services.
In September, the attorneys general (AGs) of 48 US states, the District of Columbia, and Puerto Rico announced the latest regulatory salvo against “Big Tech”—the kickoff of an antitrust investigation of Google.[1]
The announcement, led by Texas Attorney General Ken Paxton, cast a wide-ranging net on the internet giant’s business practices, including its alleged stranglehold over the market for online advertising. The official extent of the joint investigation is in the form of a civil investigative demand (CID), consisting of a list of questions and document demands.
On the day of the probe’s launch, Paxton gave a news conference from the steps of the U.S. Supreme Court, saying that “they dominate the buyer side, the seller side, the auction side, and the video side with YouTube.”[2] Some of the other AGs emphasized that they would be looking into the company’s search result practices and management of user data.
The emergence of a rare public display of Washington bipartisanship (California and Alabama were the only nonparticipating AGs) highlights the complicated landscape of antitrust regulation in the U.S., with more regulation likely on the way.
Google, as well as several other Big Tech companies, already face antitrust reviews from the U.S. Department of Justice (DOJ) and the Federal Trade Commission (FTC). The other companies—Amazon.com Inc., Apple Inc., and Facebook—face questions over whether they have grown too large, overwhelming rivals and causing higher costs to consumers.
‘The pendulum has swung’
Although all the investigations appear to be in the early stages, some antitrust experts believe the AG probe opens a different front than the federal investigations while possibly representative of a wider paradigm shift in antitrust regulation.
“This investigation is different in that it seems to be examining the basic business model and the platform itself rather than looking at specific narrow and discrete practices,” attorney Douglas Tween, a partner at law firm Linklaters LLP, recently told CEP Magazine.
“For years tech companies have been lightly regulated relative to other key industries like financial services, but now suddenly the pendulum has swung all the way to the other side, and tech companies are under assault from many places, including the federal government, state AGs, the European Union, and other enforcers around the globe,” he added.
Other politicians from across the political spectrum also appear to be showing a greater appetite for taking on Big Tech, from Senator Elizabeth Warren to President Donald Trump. And Facebook is already being pursued in a separate antitrust investigation by a coalition of state AGs led by New York Attorney General Letitia James. That probe expanded to 47 total AGs in October.[3]
“With respect to the [states’] probe, AGs have a lot of power to effect change through litigation, Tween said, while noting that “historically they have rarely used that power on a sweeping scale.”
“But there may be more willingness to do that now. Taking on Big Tech companies has a lot of populist support at the moment, which I’m sure is not lost on the AGs. There is an old joke that AG stands for Aspiring Governor, and many AGs see an issue on which they can score political points.”
