DOJ launches broad antitrust review of Big Tech

The United States Department of Justice (DoJ) has launched a broad antitrust review into whether Apple, Google, Amazon, Facebook and other technology companies are unlawfully stifling competition.

Justice Department antitrust chief Makan Delrahim said in a statement:

Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands. The department’s antitrust review will explore these important issues.

It will specifically focus on the practices of online platforms that dominate internet search (Google), social media (Facebook) and retail services (Amazon), DoJ said. The department also has jurisdiction over Apple for suspected monopolization tactics. DoJ hasn’t defined any end goals yet for the Big Tech review. For now, the government is eager to learn whether major technology companies are stifling competition with their software platforms.

The inquiry could lead to additional investigations of specific company conduct, The Wall Street Journal reported this morning.

The new antitrust inquiry under Attorney General William Barr could ratchet up the already considerable regulatory pressures facing the top US tech firms. The review is designed to go above and beyond recent plans for scrutinizing the tech sector that were crafted by the department and the Federal Trade Commission (FTC).

The two agencies, which share antitrust enforcement authority, in recent months worked out which one of them would take the lead on exploring different issues involving the big four tech giants. Those turf agreements caused a stir in the tech industry and rattled investors. Now, the new Justice Department review could amplify the risk, because some of those companies could face antitrust claims from both the Justice Department and the FTC.

DoJ worries about these technology giants expanding into additional businesses and taking advantage of so-called network effect, making it virtually impossible for newcomers to compete on a fair ground.

Uncle Sam is also believed to be probing Google over suspected monopolization practices.

Apple, of course, has been under fire from critics who have taken issue with the 15-30 percent fee that the company takes on app sales and subscriptions. Spotify, for instance, in March filed an antitrust complaint against Apple with Europe’s competition watchdog, targeting the App Store business model.

So far, Apple denied any wrongdoing.

Similarly, The Netherlands Authority for Consumers and Markets in April launched a probe into whether the iPhone maker is giving its own apps preferential treatment, something that a recent Wall Street Journal investigation alleged as well.