Two years ago, Facebook changed its mission statement to focus on “bringing the world closer together.” On Tuesday, it appeared to accomplish that lofty goal for the political world, at least, as Republican and Democrat lawmakers united in bipartisan distrust of the social media giant.
“Facebook is dangerous,” Ohio Sen. Sherrod Brown, a Democrat and ranking member on the Senate Banking Committee, said in prepared remarks to kick off a hearing on Facebook’s proposal for a new digital currency, called Libra. “Like a toddler who has gotten his hands on a book of matches, Facebook has burned down the house over and over, and called every arson a learning experience.”
Sen. Martha McSally, an Arizona Republican, sounded a similarly damning note later in the hearing. “I don’t trust you guys,” she said. “Instead of cleaning up your house, now you’re launching into a another business model.”
Facebook wasn’t alone, with Google and Amazon also taking heat in Washington throughout the day Tuesday.
Once viewed in purely glowing terms as icons of American innovation, these companies faced pointed challenges to their power and mounting calls from lawmakers, presidential candidates, a tech industry insider and even President Donald Trump to have their immense power checked.
Facebook, Google, Amazon and Apple on the Hill
Executives from Facebook, Google, Amazon and Apple testified at a House hearing examining the consequences of their growing power, part of an antitrust probe announced last month.
The companies were repeatedly pressed to answer for their market dominance and reports of anti-competitive tactics, with Rep. Joe Neguse, a Democrat representing Colorado, singling out Facebook — which owns an array of popular services, including Instagram, WhatsApp and Facebook Messenger.
“When a company owns four of the largest six entities measured by active users in the world in that industry, we have a word for that,” said Neguse. “And that’s monopoly.”
Matt Perault, Facebook’s public policy director, rejected that characterization. At one point in the hearing, Perault said: “Many of our competitors are sitting at this table with me.”
Lawmakers also zeroed in on Amazon, questioning whether it is gaining an anticompetitive advantage over the third-party merchants on its platform because of its powerful relationship with them — an idea that underpins Massachusetts Sen. Elizabeth Warren’s proposalto break up Amazon, in particular.
“When people sell products on your site, do you track which products are most successful and then do you sometimes create a product to compete with that product?” asked Rep. Pramila Jayapal, a Washington Democrat.
Nate Sutton, an associate general counsel at Amazon, at first said the company does not use public data about which products are most popular to inform the creation of Amazon-branded products.
But Rep. David Cicilline, the Rhode Island Democrat who chairs the panel’s antitrust subcommittee, pressed further. He repeatedly reminded Sutton in one tense exchange that he was speaking under oath.
“We don’t use individual seller data to compete with them,” Sutton finally said.
But some lawmakers cautioned that talk of breaking up large tech giants is premature. Rep. Jim Sensenbrenner, the top Republican on the panel, said the idea is “misguided” because it could hurt businesses that depend on the large platforms and won’t necessarily solve bad privacy practices.
“Just because a business is big doesn’t mean it is bad,” he said.
Trump orders Justice to look into Google
In addition to the House antitrust probe, two federal agencies are said to be paving the way for potential investigations into the four companies’ market dominance.
Trump piled on, too, encouraging the Justice Department to investigate Google after billionaire tech investor Peter Thiel said earlier Tuesday that the CIA and FBI should investigate whether Google has been infiltrated by Chinese intelligence.
“He made a very strong charge. One of the top — maybe the top expert on all of those things and he made a very big statement about Google,” Trump said, noting Thiel is a strong supporter of his and spoke at his nominating convention in 2016. Thiel is a member of Facebook’s board of directors.
Trump tweeted on Tuesday morning that his administration would look into the matter, and expanded on his views during a Cabinet meeting.
“I would like to recommend to the various agencies, including perhaps our attorney general, who is with us, to maybe take a look,” Trump said. “It’s a big statement when you say that Google is involved with China in not a very positive way for our country.”
“So I think we’ll all look at that. I know that our other agencies will be looking at it. We’ll see if there’s any truth to it,” he said.
Google sharply denied Thiel’s claims, saying in a statement, “We do not work with the Chinese military. We are working with the U.S. government, including the Department of Defense, in many areas including cybersecurity, recruiting and healthcare.”
Sanders calls for Amazon investigation
Separately, Vermont Sen. Bernie Sanders, a Democratic presidential candidate, called for a complete investigation into Amazon by the federal Occupational Health and Safety Administration.
Sanders tweeted that an investigation is long overdue, citing reports of “dangerous, dehumanizing conditions.”
Amazon responded in a statement saying that Sanders’ allegations are “not an accurate portrayal” of working conditions at its warehouses. Amazon also renewed its invitation to Sanders to visit fulfillment centers, writing, “he committed to visiting, but to date has never stepped foot in one of our buildings.”
Sanders later tweeted: “I am not interested in a photo op at an Amazon warehouse. I am calling for Labor Department inspectors to come in, unannounced, and do thorough investigations of the facilities where hundreds of workers have told me about horrendous conditions and abuse.”
Companies say China is the competition
The House Judiciary Committee held its hearing as part of a “top-to-bottom” antitrust investigation of the tech industry announced last month. An earlier hearing focused on the tech industry’s impact on the news industry. The latest hearing will focus on “innovation and entrepreneurship.”
In prepared remarks for the antitrust hearing Tuesday, the four execs representing the tech giants defended their companies against charges of becoming dangerously powerful. They played up their “quintessentially American” founding stories, in the words of Perault, and stressed the competition they do face, at home and abroad.
“We have competitors all around the world, notably in China, including companies like WeChat and TikTok,” Perault said in his opening remarks. Likewise, Adam Cohen, director of economic policy at Google, noted that even in its dominant search business, consumers can still choose from rivals such as Bing and Yahoo.
The companies also played up the ways in which their online platforms support small businesses. But despite the growing scrutiny, Big Tech has continued to move forward with efforts to get even bigger.
Growing businesses
In the weeks since news of the potential US antitrust probes first broke, Google announced a $2.6 billion acquisition to bolster its cloud computing division, Jeff Bezos teased plans for Amazon to spend billions to launch thousands of satellites that provide broadband internet, and Facebook unveiled Libra with the potential to change financial and payment systems around the world.
The first Libra hearing suggests this aggressive approach to expansion may only make it harder for companies like Facebook to win over skeptical politicians at the antitrust hearing. In recent weeks, the tech companies have trotted out multiple lines of defense.
Google CEO Sundar Pichai told CNN Business last month that being bigger “does offer many benefits,” including the ability to invest in cutting edge technologies such as artificial intelligence and quantum computing. Similarly, Facebook CEO Mark Zuckerberg recently said being bigger makes it possible for the company to invest in preventing the spread of misinformation and election interference. Execs from both companies have also suggested that breaking up US tech companies could benefit businesses in other countries, namely China.
The shift in DC’s sentiment toward Silicon Valley has been a long time coming. Since the 2016 election, internet giants such as Facebook and Google have been embroiled in a series of PR crises over data privacy, the role their platforms played in election meddling, and the spread of misinformation, raising concerns about the full impact these powerful businesses are having on society. At the same time, these internet companies have increasingly expanded beyond their original markets into new categories, including healthcare, entertainment and transportation.
The House Judiciary Committee’s investigation will likely result in a report outlining possible policy recommendations, Cicilline previously said, and could lead to new legislation in the coming months.
But if the hearing Tuesday is any indication, Washington could have a hard time reining in these companies. At various points in the hearing, House representatives asked head-scratching questions about how Facebook beat MySpace and why Apple sends notifications to sign up for iCloud subscriptions.
