The large tech companies of the world - including those based in the United States could soon face action against the US federal government over antitrust issues.
Announcement of a sweeping antitrust probe of unspecified technology companies was made on Monday by the US House Judiciary Committee. It said in a statement that there would "a top-to-bottom review of the market power held by giant tech platforms," that would be the first time that the Congress has undertaken such a probe ever.
Following reports in the media about the US government’s plans for beginning of investigations into anticompetitive behavior by several of the technology majors, there was a drop in the shares of large US etch companies including Facebook, Google, Amazon and Apple.
While there was a drop of 7.5 per cent in the share price of Facebook, Google parent Alphabet shed about 6.1 per cent off its earlier stock price. On the other hand, shares of Amazon fell by 4.6 per cent while there was a marginal drop of 1 per cent on the news.
Accoridng to reports, divvying up of turf between the Department of Justice's antitrust cops and the Federal Trade Commission could be getting reflected in some of the underlying developments. The Justice Department would reportedly hold authority over Google and Apple, which the FTC would take point on investigations of Facebook and Amazon.
There were multiple unconfirmed reports over the week end of a competition investigation into Google being prepared by the US Justice Department. While on Monday, a report in the Wall Street Journal quoted unnamed sources the FTC has secured the rights to bring a possible investigation into Facebook.
While investors apparently reacted to the uncertainty immediately, it would not be till years that the investigations, if any materialize, would get completed.
"I think (the speculation) is becoming more real, but antitrust is not a 24-hour event," said Blair Levin, a fellow with the Brookings Institution and a former chief of staff to a Federal Communications Commission chairman.
He said that the move clearly indicates that the actions of the big tech companies are attracting increasing attention from the government but the outcome can be of different types. He said that it is most likely that the regulators would be stricter about the various practices of the companies, including privacy practices. The US government has been under pressure for quite some time now over calls for greater scrutiny of the large tech companies as a section of the society and politicians are concerned over the increasing reach and power of the tech companies.
Sandeep Vaheesan, legal director for Open Markets Institute, which advocates against monopolies said that a response to that pressure could be the act of the bifurcation of the jurisdictions between the FTC and DOJ.
"There's still a long way to go before there is even an investigation," he said. "And an investigation could be an extended process." The actions taken by regulators and authorities in Europe is only now being contemplated by the US regulators and authorities and the actions of the European authorities have resulted in fines against Google to the tune of billions of dollars while other tech companies being fined lower amounts too.
(Source:www.business-standard.com)
Announcement of a sweeping antitrust probe of unspecified technology companies was made on Monday by the US House Judiciary Committee. It said in a statement that there would "a top-to-bottom review of the market power held by giant tech platforms," that would be the first time that the Congress has undertaken such a probe ever.
Following reports in the media about the US government’s plans for beginning of investigations into anticompetitive behavior by several of the technology majors, there was a drop in the shares of large US etch companies including Facebook, Google, Amazon and Apple.
While there was a drop of 7.5 per cent in the share price of Facebook, Google parent Alphabet shed about 6.1 per cent off its earlier stock price. On the other hand, shares of Amazon fell by 4.6 per cent while there was a marginal drop of 1 per cent on the news.
Accoridng to reports, divvying up of turf between the Department of Justice's antitrust cops and the Federal Trade Commission could be getting reflected in some of the underlying developments. The Justice Department would reportedly hold authority over Google and Apple, which the FTC would take point on investigations of Facebook and Amazon.
There were multiple unconfirmed reports over the week end of a competition investigation into Google being prepared by the US Justice Department. While on Monday, a report in the Wall Street Journal quoted unnamed sources the FTC has secured the rights to bring a possible investigation into Facebook.
While investors apparently reacted to the uncertainty immediately, it would not be till years that the investigations, if any materialize, would get completed.
"I think (the speculation) is becoming more real, but antitrust is not a 24-hour event," said Blair Levin, a fellow with the Brookings Institution and a former chief of staff to a Federal Communications Commission chairman.
He said that the move clearly indicates that the actions of the big tech companies are attracting increasing attention from the government but the outcome can be of different types. He said that it is most likely that the regulators would be stricter about the various practices of the companies, including privacy practices. The US government has been under pressure for quite some time now over calls for greater scrutiny of the large tech companies as a section of the society and politicians are concerned over the increasing reach and power of the tech companies.
Sandeep Vaheesan, legal director for Open Markets Institute, which advocates against monopolies said that a response to that pressure could be the act of the bifurcation of the jurisdictions between the FTC and DOJ.
"There's still a long way to go before there is even an investigation," he said. "And an investigation could be an extended process." The actions taken by regulators and authorities in Europe is only now being contemplated by the US regulators and authorities and the actions of the European authorities have resulted in fines against Google to the tune of billions of dollars while other tech companies being fined lower amounts too.
(Source:www.business-standard.com)
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