October 26, 2020 at 5:00 am ET
The COVID-19 pandemic is entering its second wave, opening the way for Big Tech to grow further and entrench control over the global economy. Mom and pop shops have been decimated by the commercial shutdown tied to the disease, and the digital behemoths – Google, Amazon, Facebook and Apple – have stepped in to extend their dominance in industries ranging from online shopping, health care and entertainment to education and cybersecurity.
As CEO of the Kelkoo Group, once one of the world’s top online shopping businesses, the threat posed by Big Tech is personal. Once Kelkoo established itself as a leader in shopping search, Google attempted to erase our company from the marketplace in order to advance its own comparative shopping site, Froogle, which was later rebranded as Google Shopping. The House Antitrust Subcommittee’s recent report details Google’s preference for its own products, and how that bias detriments businesses like Kelkoo.
Google employed what has become the hallmark anti-competitive tactics of Big Tech to steal our business. It copied the features of Kelkoo’s and other online operations. Google then took to ranking Google Shopping’s services at the top of online searches while minimizing those of its competitors. These practices drove sites like Shopping.com, Pricegrabber and Nextag toward insolvency.
But Big Tech’s rapacious designs like those against Kelkoo haven’t gone unnoticed. Legislators, regulators and law enforcement in the United States and Europe are now in perhaps their best position ever to place a check on the monopolistic practices of these companies. The U.S. Department of Justice and state attorneys general are taking the first steps in fighting back against Google’s anti-competitive practices after filing a complaint against the company’s overwhelming dominance in advertising and search.
No event demonstrated this new assertiveness more than July’s congressional hearing where the CEOs of tech’s Big Four testified before the American people. Democrats and Republicans alike came armed with documents, testimonials and emails that underscored what we in the tech industry have long argued: These companies use their size and market dominance to wipe away potential rivals in ways that are bad for consumers, innovation, and the global economy.
Rep. David Cicilline of Rhode Island, who chaired the five-hour hearing, said of Google: “As [it] became the gateway to the Internet, it began to abuse its power. It used its surveillance over web traffic to identify competitive threats and crush them.” At an August fundraiser he added that the hearing confirmed Big Tech companies have “monopoly power…market dominance… [and] bully competition.”
The Senate Judiciary Subcommittee on Antitrust, Competition Policy & Consumer Rights held its own public hearing in September on Google’s dominance in online search. The Department of Justice and state attorneys general have initiated antitrust litigation against Google and additional states have signaled they may file a separate antitrust lawsuit by year-end. And while the European Union’s competition commissioner, Margrethe Vestager, hasn’t yet found effective remedies, she has shown a dogged determination to combat what she charges are Big Tech’s systematic abuses of their market power.
July’s hearing was so compelling because it documented how our companies weren’t the only global businesses victimized by Google’s predatory behavior. Testimony and documents showed how Google had stolen content from the business rating site, Yelp, and then threatened to “delist” the company from Google’s platform if it complained. Yelp executives said they were too intimidated to fight back.
Rep. Cicilline also highlighted the fortunes of Brian Warner and his website, CelebrityNetWorth. The entrepreneur declined an initial Google request to include his content on the search engine. But two years later, Google used the information anyway, causing Warner’s online traffic to plummet by 80 percent and forcing him to lay off half of his staff. Warner told congressional investigators: “If someone came through with an idea for a website or web service today, I’d tell them to run. Run as far away from the web as possible.”
It won’t be easy to combat this type of market abuse. Google and other tech giants have spent millions on lobbyists in Washington and Brussels over the past decade to defend their size and tactics. They have also seized on the COVID-19 pandemic to try and position themselves as indispensable partners in the economic recovery process. Google and Apple have offered a contact-tracing application to global health officials. In Europe, Google has delayed antitrust investigations and refused to change its business models, preferring to pay inconsequential fines compared to the revenue their abuses allow them to generate.
But as the July hearing underscored, U.S. lawmakers, regulators and law enforcement aren’t being fooled by Big Tech’s ultimate ambitions. The economic malaise fueled by COVID-19 is imperiling the fortunes of small and medium-sized businesses. We can’t allow Big Tech to fill this void and permanently undermine choice and innovation in our society.
Richard Stables is the CEO of the Kelkoo Group, a global network of product comparison and e-commerce sites.
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