Apple, Google face antitrust hearing on Capitol Hill

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Apple and Google are set to square off with lawmakers Wednesday over whether the companies’ app stores violate antitrust rules.

Apple resisted appearing at the Capitol Hill hearing but ultimately accepted the invitation from lawmakers, who are looking to crack down on tech and will put the app stores under a microscope.

The Senate antitrust panel hearing is likely to yield tense exchanges between the companies and Republicans, who are furious over their censorship practices, and Democrats, who think the companies have too much power.

Google’s decision not to restore the social media platform Parler for distribution from the Google Play Store will rankle Republicans, especially after Apple said this week that it would reinstate the app that was popular with conservatives and supporters of former President Donald Trump. Both Google and Apple removed Parler from their app stores amid concerns about future violence in the aftermath of the Jan. 6 riot at the Capitol.

Congress is debating several antitrust proposals that would affect the tech sector and Google and Apple in particular. Alongside the possibility of new laws, Google is facing antitrust lawsuits from the federal government, state attorneys general and news publishers.

The parent company of the Daily Mail newspaper is suing Google over allegations it has a monopoly in digital advertising that harms the news publishing industry, following a similar antitrust suit filed by the publisher of a West Virginia newspaper chain against Google and Facebook.

Apple, meanwhile, is locked in an antitrust lawsuit against video game developer Epic Games, and the British government said last month that it was investigating the company over suspected anti-competitive behavior involving its app store.

Apple is not in the good graces of Congress, either. It rankled lawmakers by initially declining to attend Wednesday’s hearing until subcommittee Chairwoman Amy Klobuchar, Minnesota Democrat, and Sen. Mike Lee of Utah, the panel’s top Republican, wrote to Apple CEO Tim Cook to prod the company to reverse its decision.

At issue is Apple and Google’s gatekeeping power over the app marketplace, which Big Tech critics such as Matt Stoller note is 100% of the market for smartphone operating systems. Mr. Stoller, research director at the liberal American Economic Liberties Project, said Congress should pass a law preventing companies from having app stores with exclusive control.

“I think there’s a possibility for action here. It’s the Senate, and the Senate, I think there’s generally a consensus [for action],” he said. “The House might be different.”

Other liberals who are sympathetic to the tech companies find Democrats’ focus on the app stores to be unwarranted. Adam Kovacevich, who started the liberal Chamber of Progress to bring new advocacy muscle to Washington on behalf of tech, said Mr. Stoller’s focus on the app stores is strange.

Mr. Kovacevich, whose group partners with Google and other large tech companies such as Amazon and Twitter, said government intervention on antitrust grounds against the app stores would benefit other tech companies, not consumers.

“This isn’t a fight that has an impact on consumer pocketbooks, it’s a business dispute between well-funded companies,” Mr. Kovacevich said.

However, he does not begrudge companies lobbying for their business interests as the Coalition for App Fairness has done on behalf of members such as Epic Games and software tool Basecamp against Apple. He said he thinks there are more pressing tech concerns and thinks users are pleased with their app store experiences.

Some in the tech sector fear new congressional action targeting the app stores, including those working at the behest of Apple and Google. Neither Apple nor Google responded to requests for comment about Wednesday’s hearing, but the Consumer Technology Association — which includes both companies as members — said it wants Congress to avoid new policies that pick winners and losers.

“As policymakers consider design or performance mandates on America’s leading technology companies, CTA urges caution,” said Gary Shapiro, Consumer Technology Association president. “New legal requirements for app store providers and consumers could have major unintended consequences affecting national competitiveness, privacy and security, entrepreneurs and even the retirement accounts of millions of Americans.”

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