Big Tech has big credibility gap
How much confidence should we have in Big Tech firms to do what is right on their own? Apparently not much if you are Rep. David Cicilline (D-R.I.), chairman of the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law, who recently held an oversight hearing on the market power of online platforms where corporate executives from Google, Facebook, Amazon and Apple provided testimony about their company’s policies and practices.
This comes at a time when the European Union has opened an antitrust inquiry into Amazon’s dealings with third party sellers and the Federal Trade Commission has just imposed a $5 billion fine against Facebook.
At the much-anticipated hearing last Tuesday, the companies addressed concerns about their dominant market positions, monopoly power and allegedly harmful business practices affecting consumers, competitors and small businesses. Their answers to key questions from the committee appeared to be inconsistent with reputable reports of aggressive and even predatory business practices. Worse yet, some of the well-rehearsed answers from the Big Tech witnesses were plainly evasive and dilatory.
That is why Chairman Cicilline took the extraordinary step of asking executives from each company to publicly agree to two things. First, he asked each one to “pledge on behalf of the companies they represent to cooperate to the fullest extent possible and to act in good faith to respond to committee requests in a timely and complete manner.”
Second, he cited “disturbing reports” that a particular company had committed acts to “aggressively impede Congressional oversight and go so far as to hire opposition research firms to do opposition research on Members of Congress and staff of the Committee.” He asked each company’s executive to agree that it would refrain from such actions.
Even by cynical Washington standards, the need for such reassurance in a Congressional hearing under oath is remarkable. Cicilline clearly understands that Big Tech has mastered the Washington art of deny, deflect, deceive and delay — and he masterfully marked the record with a view to future action.
Equally important, Rep. Jamie Raskin (D-Md.) read letters from two witnesses who were not present at the hearing. Their message to the committee was that, “we are not able to be more public at this time out of concern for retribution to our business,” and “given how powerful Google is in their past actions, we are quite frankly worried about retaliation.”
Raskin then asked each witness if they would “commit on behalf of your company that you would not retaliate in any way against any of the businesses that cooperate with this committee or share requested information with us as part of the investigation? Will you all agree to a non-retaliation policy toward businesses that participate?” With as much earnestness as they could feign, executives from Google, Facebook, Amazon and Apple said “yes,” one-by-one.
By that point in the hearing, I detected a palpable lack of credibility. A set of pointed questions from other committee members had already pierced the veil of truth. For example, when asked by Rep. Joe Neguse (D-Co.) about monopoly, Matt Perault of Facebook found it hard to admit that his company owned four of the top six social media platforms — Facebook, What’s App, Facebook Messenger and Instagram. Adam Cohen of Google could barely muster an answer about its leading competitor in search. And Nate Sutton of Amazon struggled to identify an equally competitive online platform on which merchants could effectively sell their products following questions from Rep. Lucy McBath (D-Ga.).
Although many of their responses did not pass the giggle test, the Big Tech representatives stayed in character. As the hearing endured, it became clear to me that all bets on honesty were off.
For an industry with an image problem, you would think that someone among their legion of lobbyists, advisors, consultants and apologists would have given those testifying sound advice and timeless wisdom: Tell the truth and the truth will set you free. How refreshing would it have been to hear from any one of the assembled executives that there was a modicum of truth to some of the reports of their bad behavior? How amazingly responsible would it have been for any of the Big Tech companies to acknowledge the concerns of consumers and competitors and commit to a new direction? How competitively courageous would it have been for one of the Big Tech firms to break ranks and admit — even cautiously — that some of its dealings have been problematic?
As Congress continues its investigations of Big Tech, there are bound to be more opportunities for Amazon, Apple, Facebook and Google to do the Washington shuffle. They will continue to send executives who have no C-suite authority, who “are not familiar with the specific set of facts” Congress asks about or who “are not involved in that aspect of the business.” They will continue to tiptoe through the margins with plausible deniability and feigned ignorance of the harmful effect of the company’s actions in the market.
Unless there is a change in the cadence and the consequence of Congressional and FTC investigations, this dance can go on for a very long time. According to several top Wall Street analysts, the antitrust concerns surrounding Google, Amazon, Facebook and Apple are temporary, overblown and amount to more smoke than fire. The irony is that Big Tech continues to grow and enjoy strong shareholder value.
Even as Big Tech stock climbs, its image is in decline. It will take more than money to regain credibility. It will require Google CEO Sundar Pichai, Amazon CEO Jeff Bezos, Facebook CEO Mark Zuckerberg, and Apple CEO Tim Cook to do something they have never done — lead responsibly from the top.
Adonis Hoffman is chairman of Business in the Public Interest, Inc. and founder of yourprivacymatters.org. He is a former chief of staff and senior legal advisor at the FCC and served in legal and policy positions in the U.S. House of Representatives. He has also served as an adjunct professor at Georgetown University. Follow him on Twitter @AdonisHoffman.