Tech giants face new threats from the government and regulators
Congress, prosecutors and bureaucrats are in the mood to move fast and break-up things
The Economist 2019-3-15
ANNIVERSARIES ARE often happy occasions, but not this one. March 17th will mark a year since the New York Times and the Observer published exposés about how Facebook enabled the personal data of tens of millions of Facebook-users to leak to an outside political firm, Cambridge Analytica. The resulting scandal has plagued the social-networking firm and provoked scepticism among politicians and consumers that big tech firms can be trusted to police themselves. Many Republicans and Democrats, who share little in common ideologically, agree that the tech giants need to be reined in. Software may be eating the world, as the technology investor Marc Andreessen famously said, “but the world is starting to bite back,” says Bruce Mehlman, a lobbyist in Washington.
Elizabeth Warren, a senator vying to become the Democratic nominee for president, recently suggested breaking up big tech companies, including Facebook, Google and Amazon, and unwinding some of their previously allowed mergers, such as Facebook’s purchases of the apps Instagram and WhatsApp. She has declared that big tech firms have “too much power over our economy, our society and our democracy.” As if to underscore her concern, Facebook temporarily blocked some of Ms Warren’s anti-tech advertisements from appearing on the social network, reportedly because of trademark issues with Facebook’s logo, before they were restored. Nor is this animus confined to Democrats. Ted Cruz, a Republican senator from Texas, says Ms Warren is right that big tech has too much power to silence free speech and is “a serious threat to our democracy.” Mr Cruz added that this was the first time he had agreed with Ms Warren about anything.
Much as Wall Street animated the 2008 presidential election, antitrust will feature prominently in the 2020 campaign. Amy Klobuchar, another senator and presidential hopeful, has sponsored bills that would toughen America’s antitrust laws, for example by requiring merging firms to prove their deals would not harm competition. Ms Warren’s views on tech will oblige other Democratic candidates to clarify where they stand and may drag other candidates towards more extreme positions, as her stance on wealth taxes did.
It does not require a sophisticated algorithm to detect a growing unease with big tech firms. This month at South by Southwest, a conference in Austin that attracts many techies, Margrethe Vestager, the European commissioner for competition who has led the way on punishing tech firms for anti-competitive behaviour, asked whether there should be more government intervention against them. Most of the several hundred people in the room raised their hands.
How best to take on tech is a conundrum facing many governments. A new report by a panel of experts led by the Harvard economist Jason Furman, which was published on March 13th, looks at how Britain can encourage digital competition. It recommends a series of things, including developing a code of conduct for tech firms, tweaking merger rules, making it easier for customers to move their data to rival firms and creating a new competition unit with technology expertise. But Britain’s ability to tame tech firms is limited. Far more responsibility falls on America, the homeland of big tech.
Democrats and Republicans may both poke at tech, but they often have different worries. Democrats are more interested in issues of market power and privacy. Republicans share their concerns about privacy, but focus less on antitrust and more on the supposed political bias of firms like Google and Facebook, which they believe suppress conservative views. However, in the year since the Cambridge Analytica scandal, neither party can claim much has been done yet to constrain big tech firms. Could that be changing?
The Federal Trade Commission (FTC), a consumer watchdog, is believed to be nearing completion of its investigation into whether the Cambridge Analytica fiasco is evidence that Facebook violated a 2011 agreement not to share data without consumers’ express consent. Some think a massive fine, perhaps as high as $5bn, could be forthcoming. The “effectiveness” of the FTC is “is going to be weighed to a large degree by their actions on Facebook,” says Barry Lynn of the Open Markets Institute, a think-tank that argues for more forceful use of antitrust laws.
The FTC has also launched a task-force focused specifically on tech firms, which could play a role in unwinding past tech mergers. Separately, federal prosecutors are reported to be considering a criminal investigation into Facebook’s sharing of data with other firms.
Another place to watch for signs of tech firms falling under tighter control is federal privacy legislation, which is currently being drafted in Washington, DC. Senators are weighing how best to write a national bill, which would give consumers greater control over how their data are collected and used online. California forced the federal government’s hand by drafting and passing its own privacy law, which goes into effect in January 2020.
Most businesses “don’t want a patchwork of state laws that are hard to implement and make no sense,” says Jon Leibowitz, former chairman of the FTC, who is now a lawyer at Davis Polk. A new federal privacy bill seems unlikely in the short term, but never before has there been so much consensus about the need for privacy legislation, says Mr Leibowitz.
The other principal worry is that big tech firms suppress competition. That can be addressed by enforcing antitrust law. America has not brought a big antitrust case against a tech giant for 20 years, since it went after Microsoft for anti-competitive behaviour. Those in favour of the “big case” tradition of antitrust, as Ms Warren is, believe that break-up attempts, even if they are not ultimately successful, put tech firms on guard and can allow innovative upstarts to thrive while the giant is distracted by court cases. Proponents of this school of thought point out that new firms arose after government actions against AT&T, IBM and Microsoft. But not everyone agrees that it is a good idea to try to break up tech firms. It is better to prevent mergers happening in the first place than attempt to untangle them after the fact.
A big move against a tech giant seems unlikely until after 2020. But even if the elected president does not have Ms Warren’s enthusiasm for breaking up these companies, there could be pressure to do so. State attorneys-general are increasingly agitating to take action against big tech firms over privacy infringements and anti-competitive behaviour. There are rumours that some have singled out Facebook. If they band together, attorneys-general could hurt tech firms and provoke action by the federal government—just as they did, launching investigations and going on to pressure the government, in the cases against big tobacco and Microsoft that started in the 1990s.
In the coming year antitrust policy and tech regulation will be debated fiercely. But 2020 will not be the first election in which antitrust policy will play a role. The issue famously featured in 1912, when the contenders talked about the powerful companies of their day, called “trusts”, and whether they should be dismembered. Woodrow Wilson, who believed there needed to be new legislation to strengthen antitrust enforcement, beat the more cautious Theodore Roosevelt to the presidency. Today’s contenders may want to take note.
Notes
happy occasions
快乐的时刻
how Facebook enabled the personal data of tens of millions of Facebook-users to leak to an outside political firm, Cambridge Analytica
信息泄露
The resulting scandal has plagued the social-networking firm and provoked scepticism among politicians and consumers that big tech firms can be trusted to police themselves.
长久地折磨困扰；激起怀疑；police监管 = monitor
the tech giants need to be reined in.
缰绳给我拉住，一样=police=monitor
have “too much power over our economy, our society and our democracy.”
现在科技巨头的支配力，阿里、腾讯，又何尝不是？
big tech has too much power to silence free speech
silence做动词，限制自由言论
Much as Wall Street animated the 2008 presidential election, antitrust will feature prominently in the 2020 campaign.
2008大选华尔街是焦点，那么反垄断反托拉斯将会是2020年的重要特点
sponsored bills that would toughen America’s antitrust laws
不是赞助，是提交法案；坚固
there should be more government intervention against them
政府干预怎么说？
a conundrum facing many governments
复杂难解的问题
But Britain’s ability to tame tech firms is limited
像野马一样，难以驯服
Far more responsibility falls on America, the homeland of big tech.
落在了。。。肩膀上
EX: The responsibility of developing Socialism falls on the younger generation.
launched a task-force focused specifically on tech firms
特遣部队，特别工作小组
Most businesses “don’t want a patchwork of state laws that are hard to implement and make no sense,”
patchwork拼接布，乱七八糟搞在一块儿，这边弄一块儿，那边弄一块儿，不统一。
EX：The conundrum of bank lies in the patchwork of different management systems provided by different tech firms where data structures are not compatible.
The other principal worry is that big tech firms suppress competition.
压制了自由竞争
Proponents of this school of thought
学派
take action against big tech firms over privacy infringements and anti-competitive behaviour.
隐私侵犯；垄断行为
In the coming year antitrust policy and tech regulation will be debated fiercely.
Views
recently suggested breaking up big tech companies, including Facebook, Google and Amazon, and unwinding some of their previously allowed mergers, such as Facebook’s purchases of the apps Instagram and WhatsApp.
如何遏制科技公司？拆解科技公司，禁止收购并购
It recommends a series of things, including developing a code of conduct for tech firms, tweaking merger rules, making it easier for customers to move their data to rival firms and creating a new competition unit with technology expertise.
建立新的、适用于科技公司的、充分竞争规则，例如，使得客户能够自由地将自己的数据转移到另一家竞争公司。现在科技公司很多会制定自己的数据格式规则，使得不好转移数据，建立壁垒，提升客户黏度。比如说，让印象笔记、有道云笔记、为知笔记、石墨笔记等等都能够自由转移文档数据
Democrats and Republicans may both poke at tech, but they often have different worries. Democrats are more interested in issues of market power and privacy. Republicans share their concerns about privacy, but focus less on antitrust and more on the supposed political bias of firms like Google and Facebook, which they believe suppress conservative views.
民主党和共和党都关注这个话题，但是点不太一样。
民主（D）：隐私保护、反垄断（自由市场）
共和（R）：隐私保护、不关心是否垄断，在意你是不是和我party的观念理念一致
Another place to watch for signs of tech firms falling under tighter control is federal privacy legislation
出现迹象：科技公司将受到越来越多的管制。来自于隐私方面的
break-up attempts, even if they are not ultimately successful, put tech firms on guard and can allow innovative upstarts to thrive while the giant is distracted by court cases.
拆分策略（break-up strategy）有什么好？给科技巨头敲敲警钟，给初创企业发展空间，因为巨头公司官司缠身，分身乏术
美国最大的、科技方面的反托拉斯法是在20年前了，针对微软的。
It is better to prevent mergers happening in the first place than attempt to untangle them after the fact.
同时在事前控制，而不是事后拆分
