Calls to rein in the tech titans are getting louder

ON JULY 16th America’s House Judiciary Committee will summon representatives from four of the five big tech firms for a hearing entitled “Online Platforms and Market Power: Part 2”. The question at hand is whether the big technology firms are using their clout to crush their rivals and stifle competition. Witnesses can expect a grilling from all sides. Although American policymakers are more polarised than ever, their fondness for tech-bashing is remarkably bipartisan.

Growing antitrust scrutiny stems in part from the sheer size of the tech firms. The big five—Amazon, Apple, Alphabet, Facebook and Microsoft—are cumulatively valued at $4.2trn, representing one-seventh of America’s total stockmarket value. Over the past 12 months they have amassed $180bn in pre-tax profits, equivalent to roughly a tenth of all profits generated by American publicly-traded companies.

The firms’ giant cash piles have helped fuel a flurry of acquisitions. In 2011 Google bought Motorola Mobility for $12.5bn. Three years later Facebook splashed out $18bn on WhatsApp, a rival messaging firm. In 2016 Microsoft acquired LinkedIn, a professional-networking site, for $24bn. The following year Amazon snapped up Whole Foods, a posh grocer, for $13.6bn. The firms have splurged some $92bn of cash in the past five years (as well as additional billions in stock) buying up smaller rival firms (see chart).

That is not the only thing to have aroused the suspicion of regulators and politicians. In the past two years Alphabet, Google’s parent company, has been stung three times by EU regulators, to the tune of €8.25bn ($9.27bn), for anti-competitive behaviour in the fields of online-shopping search results, its mobile operating system and advertising. This month France announced a new digital-services tax on big tech companies. Several other European countries are considering similar levies. Meanwhile, America’s Federal Trade Commission is reportedly planning to hit Facebook with a $5bn fine for data-privacy violations.

To fight back, Silicon Valley has turned to K Street. Since 2014 the big five tech companies have spent some $265m lobbying lawmakers on Capitol Hill. Alphabet, Google’s parent company, is one of the biggest spenders. In 2018 alone, the search giant spent $22m on lobbying. That hasn’t muted growing calls for action. Just try typing “Should Google…” into the firm’s own search bar. The first autocomplete response is “be broken up”.