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tv   The Communicators Antitrust Competition Policy  CSPAN  June 19, 2021 6:31pm-7:02pm EDT

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million americans will die unless we take away freedom. what if they predicted 30 million? ask yourself, what amount of force from government would have meant anything at that point? >> sunday night on q&a, the director of the freedom center on his book when politicians panicked. what impact the lockdown had on the american economy, sunday night at 8:00 p.m. eastern on c-span's q&a. you can also listen to q&a as a podcast. find it wherever you get your podcasts. >> we are funded by these television companies and more. including comcast. >> comcast is partnering with 1000 community centers so that students can get the tools they
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need to be ready for anything. >> comcast supports c-span as a public service, along with these other television providers, giving you a front-roast eat 10 democracy. -- front-row seat democracy. peter: large social media and tech companies are facing active antitrust actions, that includes amazon, facebook, apple and google. this week on "the communicators," a discussion on antitrust and regulation. joining us, jennifer huddleston of the action form and barry lynn of the open markets institute. mr. lynn, are we entering a new era of antitrust action? barry: thank you for having me today, peter. absolutely. we are off the charts in terms of where we have been or the last 40 years in terms of competition, policy and
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monopoly. in the last year, we had five antitrust lawsuits against google and facebook. we have actions against amazon, people talking about new philosophies of competition policy, and this is all radically new. and this conversation can turnout to be truly transformative for the united states. because competition -- competition policy sounds technical, but it is underneath everything. it is a good thing for all of us. peter: jennifer huddleston. jennifer: we certainly are seeing an increased conversation around appropriate use of antitrust, this is a pivotal moment in the future of competition policy in the united states. what is important is that we
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stick to a principled approach based on the consumer welfare standard when we are analyzing these cases against any company, whether text giants that find themselves under scrutiny, whether it is related to antitrust or data privacy, or content moderation, or any other industry. the consumer welfare standard provides an objective standard that has shown to be highly adaptive, as well as providing appropriate focus on allowing a competitive market that serves consumers. peter: jennifer huddleston, our monopolies inherently bad? jennifer: monopolies are bad. but we should be careful about the use of the term monopoly. a lot of times we see this presumption, or at least rhetoric, around that all big companies are monopolies, rather than focusing on the actual economic and legal meaning of that word. antitrust is an important to to
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ensure consumers are receiving the benefits of a competitive marketplace, but we want to make sure we are not acting on a presumption that big is bad or big is automatically the same as a monopoly, instead of applying principled legal and economic ideas to analyze such situations. peter: mr. lynn? barry: i want to support something jennifer said. big is not always bad. going back to the beginning of this country, we have had to monopolies. we had the post office at the very beginning of this country, monopoly that reached everywhere . today, we have super large corporations and the answer is not always breaking them up. the basic rule in competition policy and monopolies going back to the founding of the country is that, if you can break it up, then do so because it makes it safer for democracy.
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it makes it safer for human liberty. but there are certain things you can't rake up. you can't break up railroads. you can't break up telephone companies. you can't break up the electricity companies. i would even argue that in the case of certain aspects of google and facebook and amazon, we don't want to break everything up. there is actually certain areas where we are going to have online monopolies. but that is why we have this other tool, which is to neutralize the monopolies to make sure they don't favor certain people and disfavor others. that is the basic rule of law and the private economy and in the political economy and in our society. so yeah, in many cases, we don't want to break things up. but when we don't break things up, we must make them neutral. this is the essence of what americans have done since the
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founding of this country. peter: so let's look at google and it search engine. that has faced scrutiny for many years as being a monopoly, and it is a dominant player when it comes to search function. how does one neutralize that, or should that part of google be neutralized? barry: absolutely. the way to new relies -- the way to neutralize something like a search engine or neutralize facebook's to basically ensure that there is a limit to how personalized any kind of search can become. there are clear rules on what kind of information the search engine can determine for you. and if you want to personalize it, you are the person in charge of what is personalized. right now, when you go in to -- going to search on google or enter a search on amazon, you're
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looking to buy something, google and amazon manipulate you. they take you to certain things and away from others. they tried to get you to buy certain things and listen to certain recordings and try to get you to read certain books. so we don't want to be manipulated. as human beings, we want to be fully in charge of all aspects of our lives, and simple, traditional rules we have applied to every network monopoly in our history, we apply these to google and facebook and amazon, and we can make them absolutely safe for all of us while continuing to enjoy all the benefits of these technologies. peter: jennifer huddleston. jennifer: if i may jump in, oftentimes when we are debating tech companies, we have this question of what the market is. and a lot of the debates around antitrust and tech companies boil down to this.
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because people like to say things like google is a monopoly inserts, but even the example now given shows that a lot of our searches now start on amazon. we have competitors providing a roddick for a specific market, for example, those are more -- those that are more privacy centered like duck, duck, go. oftentimes, companies that are successful are successful because they are the ones consumers find most beneficial. if we have been having this conversation a decade ago, we would have been discussing how yahoo! one the search wars. instead, we saw a better product that was better able to serve consumers. barry: this is a big issue, what constitutes a monopoly. one of our big libertarian scholars is milton friedman and
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milton friedman in 1962 in a book called "democracy and capitalism" he wrote a monopoly is any corporation that has sufficient power to affect the terms at which business is done in the market. according to that definition, google is absolutely a monopoly in search in android and in chrome and in mapping and many other aspects of this business. because it has sufficient power in all these areas to basically dictate terms to the people who want to get to market. it can dictate information to the people who are searching for information. so this is a very
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backward-looking argument, to argue that google and facebook, amazon, are not in many respects monopolists. so the question is what to do about these monopolies. and the good news is that we have a huge number of tools. we have really smart people to know how to use those tools, so that we, the american people, get to continue to use these services in ways that are good for us economically, but also safe for us politically, so that we don't have google and facebook threatening our democracy, which is what they do today, that we don't have amazon threatening our entire open commercial system, which is what it is doing today. jennifer: i think we can't neglect the importance of innovation in these markets, and the importance of disruptors we see time and time again. while it is important we do use the tools that we have in the antitrust arsenal when it is
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appropriate, whether it is ftc or doj enforcement, scrutiny given to mergers and acquisitions, under that consumer welfare standard, we have seen that those are largely adaptable to a very dynamic market like the technology and telecom space. but oftentimes, innovation has really driven competition, whether we are looking at something like, two decades ago, when we thought a merger between two video rental giants might create a monopoly, and missed the emergence of things like netflix and red box that were changing the entertainment industry, similarly when we look at the browser wars, we missed conversations around mobile that completely changed the way we access to the internet. who knows whether in 20 years if we allow innovation to continue to disrupt, what those next giants might be? giants often look like they can't be toppled, until the next disruptor comes around. barry: i agree with most of what
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jennifer just said. innovation has been fantastically important. the place where i disagree is, who are the innovators and the anti-innovators? and what we have seen time and again, this goes back hundreds of years, is that the monopolist is an anti-innovator. monopolists crush innovation. i remember when google came out, i was a writer, and a very early user of google. i loved google. it was better than anything else. and that was a long time ago. as google has become more powerful, as facebook has become more powerful, as amazon has become all powerful, they use their power to crush the upstarts, the innovators, to force all of us in society to walk down certain technological pathways and not to go down better pathways. so there are better futures for
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us as a people that we can't add to, because monopolists stand in our way, because google and facebook and amazon stand in our way. and i will point something out for jennifer, you were talking about the browser wars. let's remember what happened when it came to the browser wars, which was the last , great, tech antitrust lawsuit, which was against microsoft because of its manipulation of the browser market in the late 1990's. and it was that lawsuit that created the opportunity for google and facebook and amazon to get where they are today. antitrust equals innovation. that is a fact. is provable. we have seen it time and again over history. jennifer: innovation is one of
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the factors considered when it comes to antitrust. i think though, when we talk about the microsoft case or other attack cases -- other tech cases, there are other lessons to be learned. while the browser fight was going on, we were seeing the emergence of mobile and we didn't see microsoft get into the mobile market the way one would expect because in part they were fighting and antitrust case where there was a lot of dispute whether that was "successful." as we look at things like facebook and google, there are other upstarts that are continuing to compete. for those of us who came about in the early internet area, it is hard to imagine some of the platforms we love for social media they not be as popular with the next generation. but if you look at it, gen z is not getting on facebook at the same way -- in the same way.
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we are seeing alternatives arise to serve market needs and we're seeing the market evolve. so it is important we consider not just the status quote, but what else might be going on, so that we don't interfere in a market that continues to be innovative and competitive in an unnecessary way that could prevent consumers from having the benefits they enjoy. barry: jennifer is right here, folks in gen z are not using facebook in the way their parents used facebook. they regard facebook as old, stodgy and backward looking. they are all using instagram, and if they are overseas, folks use what's app for a lot of their communications. but do you know who owns instagram, do you know who owns whatsapp? facebook. they purchased whatsapp. they purchased facebook, to make
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sure they controlled the future. they did not want someone else to control the future. they didn't want a real competition could they wanted to make sure when gen z was poking around looking for a different way to communicate, that they controlled that web. and they are so successful at it , this is one of the things we need to focus on -- what is it at google and facebook, why are they doing this, why do they want power? why have they created all these systems of control? they do all this because they can make money and they make money by selling advertising. at these corporations together have too much captured control of online advertising. the total share, the two of them together, is north of 50% of all online advertising. and that share continues to grow. and we are talking, now, over $200 billion in advertising each year that goes into their
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pockets. so there is big money in what they do, and they are very successful in using their power, and they got a lot of money in exchange for doing that. and the fact they are monopolizing all this advertising revenue has knock on effects which we as a society have to deal with. it is crushing our journalism because there is no money for advertising in journalism. they are manipulating our speech in order to sell us more advertising. because what they do is, they rent out the manipulation machines they have created two advertisers, so advertisers can manipulate us. that is their business model. so we have the crushing of journalism. we have the manipulation of speech. you know, we have a democracy crisis in this country. and let's be honest -- google
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and facebook have played a huge role in creating this democracy crisis, and actually endangering our democracy and personal liberties. let's face up to that, let's do with that. let's get together and figure out how we are going to have, after 250 years of democracy, how we are going to continue to have this democracy. jennifer: when we talk about apps gen z is flocking to, there are a lot of apps that are not owned by facebook that are growing in popularity. tiktok is an example prince snap chat is an example. there are also completely different ideas in social media, things like clubhouse, an audio only app, that are changing the way we interact with this new technology. and as a result, just presuming gen z is on facebook in a different way isn't entirely accurate. when we are talking about advertising, this is a key point when we discussed that market definition.
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we need to ask, what are we defining as the advertising market in this space? oftentimes, we see very definitions proposed so that it is effectively, the ads on facebook are controlled by facebook. on the other hand, when you think about it from a buyer's point of view or the incredibly diverse levels of the advertising ecosystem, where there are many different elements, there may be more competition that doesn't necessarily come through on that surface level. a lot of times when we are debating the appropriate role of antitrust, is there an antitrust issue, it really comes down to, how do we see the markets? and it shouldn't be how do we see the markets as experts, but how do consumers experience the markets? a consumer can meet a lot of things -- mean a lot of things in this context. sometimes the consumer is the
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person consuming the outer sometimes the consumer is placing the ad in that ecosystem. peter: you're watching "the communicators" on c-span, a weekly look at tech and telecommunications policy. we are talking about antitrust and issues surrounding that. jennifer huddleston is with the american action for med dairyland is with the open markets institute. -- and barry lynn is with the open markets institute. barry: our organization is a nonprofit group. we take no money from businesses. we do best -- we do our best to understand how concentrated power threatens our democracy, our individual liberties, and we help people learn how americans of previous generations, facing similar threats in the past, dealt with those threats, and figure out how we can update the
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tools they used, the laws they used, the policies they used, to create a democracy, protect human liberty against concentrated private power, and do that today. peter: if you take no money from businesses, where does your funding come from? barry: our money comes from foundations. peter: jennifer huddleston, same question to you about the american action forum? jennifer: the american action forum is a 501 three c, commonly referred to as a think tank in the d.c. area. we focus on a variety of issues. my portfolio focuses on the intersection of law and technology, which includes a lot of exciting issues, things such as antitrust, but also issues related to section 230 and the regulatory state. and we have fellows working on a wide range of issues, everything from budget policy to labor markets to energy and financial
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services. peter: a couple years ago, there was a large court case here in d.c. when at&t bought directv. now, at&t is selling many of those assets to discovery. is this going to be another large antitrust issue? jennifer: it is really interesting that we see this dynamic emerging time and again where, at times, these mergers we were very concerned about, years later end up being completely different. whether it is aol and time warner or the at&t case, what is interesting is that we are seeing a lot of scrutiny of these media mergers and of the changing media landscape. we have seen a lot of changes in the last three decades in the media landscape, with the growth of straining onto the competitors are. so i have served we will see a
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thorough analysis of what this change might mean for the competition landscape. but again, it is important to look out how -- look at how dynamic the competition landscape isn't what it shows about how the industry is changing. peter: does the fact it hasn't become yet the issue it was a couple years ago, does this speak to the significant sort insignificance? jennifer: it shows we have seen a disruptor emerge and we now have a wide range of choices. most of us as consumers can think about all the different streaming services we use, particularly over the last year, to keep us entertained. and that as a result, we have seen a broadening of this market when it comes to competition, such that there is a dynamic from innovation that completely changes the way we see the market. peter: barry lynn. barry: i think it was great at&t
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decided to sell off streaming services, and those broadcast services. and at the time the deal was announced three years ago, we opposed it but we also said that it was a dumb deal. we thought at&t -- they thought that they could go and compete because they control pretty much half the wireless communications hardware system in the united states, and they could compete with the boys, facebook, amazon, google. and we said there is no way at&t, as big as they are, as powerful as they are, can compete with these other companies because they are so much more powerful. so i would say that at the time three years ago, we predicted this was not a wise move by
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at&t. and i think that has now been borne out. and the selloff by at&t, the spin off of those properties, it demonstrates the power of google, facebook and amazon. the fact that even a corporation as powerful as at&t, there is no way they're going to get ahead. this is true for comcast. all of us occurs comcast every day or verizon, whoever we are dealing with, but as powerful as they are and as much power they have to screw us over in the delivery of basic services, the fact is, they are not going to make any inroads against google, facebook and amazon. the concentration of power taking place in the united states continues unabated. and this at&t spinoff is a demonstration not only of at&t making a bad bet and trying to
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get out of it, but also of google, facebook and amazon being the masters of america today. peter: barry lynn, given what you said about this pyramid, you talked about new competition philosophies, the streaming services, cable tv, the social media giants, we are regulating each in a different way. is it time to harmonize that regulation? barry: that is a great question. the point is not to harmonize the regulation, the point is to understand. our challenge as citizens today is to understand what we are doing, what the crisis is, the nature of the crisis, and what we can do about it. the nature of the crisis is that we see this massive concentration of control over
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our communications by google, facebook and amazon, in different respects. and they use that power in ways that threaten our democracy. they manipulate what we watch. they manipulate what we read. they manipulate we speak to each other -- how we speak to each other. and this is something americans in the past have never accepted, and we shouldn't except now, because it is one of the most dangerous things anyone could accept, citizens getting over control of committed occasions to a few private corporations. peter: jennifer huddleston, you get the last word. jennifer: it is important we take a step back and think about how this conversation would have been different a decade ago. we would have been expressing concerns about companies like aol and yahoo!, that are now an afterthought and a bit of nostalgia for those of us that our millennials. what we have seen time and again
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is that allowing the innovative process to continue is often one of our best elements of competition policy. it is important that when we approach issues of competition policy, that we remain in a principled end objective point of view and recognize that the consumer welfare standard is able to provide that objective point of view and adapt to a wide range of industries, including the technology space. peter: jennifer huddleston is at the american action format barry lynn is director of the open markets institute. this has been "the communicators" on c-span. ♪ >> c-span's or unfiltered view of government. we are funded by these television companies and more. >> the world has changed. fast, reliable internet connection is something no one can live without, so wow! is
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