The Biden administration escalated its legal attack on Big Tech this week by suing Apple, the world's second-largest company, over alleged iPhone monopoly abuses.
The lawsuit comes months after federal agencies filed a lawsuit against Amazon and a lawsuit against Google, both of which sought to control their respective companies' markets.
Meanwhile, the ongoing lawsuit against Meta aims to release ownership of Instagram and Whatsapp.
Experts told ABC News that the court's move comes as a growing bipartisan consensus worries about the power of sprawling tech companies whose products and services infiltrate Americans' daily lives. It is said that this reflects the fact that
But they added that the push also demonstrates concrete efforts to protect consumers, strengthen private sector competition, and update antitrust enforcement to address 21st century issues. .
“These cases are pretty big issues,” Bill Baer, a fellow at the Brookings Institution and former head of the Justice Department's antitrust division under President Barack Obama, told ABC News. “These technology platforms are amassing enormous power.”
Amazon did not immediately respond to a request for comment. Neither did Google or Meta.
In a statement to ABC News, Apple strongly condemned the lawsuit filed by the Biden administration. “This lawsuit threatens who we are and the principles that make Apple products stand out in a fiercely competitive marketplace,” the company said in a statement.
Amazon rejected the allegations against the company and said it would file a lawsuit. In court proceedings, Google attributed its success to its superior products.
In response to ABC News' request for comment, the White House said it supports protecting consumers and competitive markets.
“The Biden-Harris administration has made clear that no American should pay higher prices or lose options just because a company breaks the law. and strongly supports strong enforcement, recently launching a strike force against unfair and illegal price fixing.We must ensure that companies are held accountable when they violate the law and keep prices high. “We must do so,” said Michael Kikukawa, White House deputy press secretary.
Here's what you need to know about why the Biden administration is targeting Big Tech.
Curbing the power of big technology
President Joe Biden has made no secret of his concerns about the power of Big Tech companies, especially when it comes to risks to consumers and small businesses.
During the 2020 campaign, Biden supported strong antitrust enforcement and stricter oversight of big technology companies, but stopped short of supporting a breakup of the companies.
The following year, Biden signed an executive order calling on federal agencies to crack down on anticompetitive practices in some key sectors, including high technology, saying, “Capitalism without competition is not capitalism. It's exploitation.” He said this at the House signing ceremony.
The aggressive stance against Big Tech coincides with a shift in public opinion toward corporations among both Republicans and Democrats.
Only one in three Americans has a favorable view of Big Tech companies, according to a 2021 Gallup poll. This finding is a significant decrease from two years ago, when 46% of Americans had a positive opinion of companies.
Among Republicans, the gloom is becoming clearer. According to the poll, 65% of Republicans have a negative view of Big Tech in 2021, up from 37% in 2019. The lawsuit filed against Google in September was based on a lawsuit originally filed by the Trump administration.
“There's a common concern among Democrats and some Republicans that these companies have so much power,” Baer said.
U.S. Attorney General Merrick Garland speaks during a press conference at the Justice Department Building in Washington, March 21, 2024. Anna Moneymaker/Getty Images
Protecting consumers and competition
The Biden administration has focused on two main harms in its various lawsuits against big tech companies: harm to consumers and threats to competition.
In its case against Apple, for example, the Justice Department argued that the company's dominance in the smartphone market helped drive up iPhone prices. The Federal Trade Commission's lawsuit against Amazon alleges that the company uses illegal business practices to prevent competitors from selling products at lower prices.
Rebecca Allensworth, a professor at Vanderbilt Law School who specializes in antitrust law, said the Biden administration is combining concerns for consumer welfare with a push for competitive markets, and that competition brings innovation, which in turn helps consumers. He told ABC News that he claims it will bring benefits.
“If we don't keep today's competitive environment healthy, tomorrow's consumers will be missing out on innovative new products,” Allensworth said.
University of Pennsylvania professor Herbert Hovenkamp criticized the idea that Big Tech companies are stifling innovation, saying they file more patents and launch new products than most companies. .
“What current government agencies cannot accept is that big companies are often needed to bring low prices and high innovation,” Hoevenkamp said.
Strengthening antitrust laws
In addition to calling for changes in business practices, the Biden administration wants to strengthen antitrust enforcement in the coming decades, according to some experts.
A series of legal decisions in the 1970s and 1980s narrowed the scope of antitrust law to consumer harm, particularly determining whether certain instances of market concentration led to price gouging.
Conversely, if a dominant company strengthens its position in a way that harms customers at the register, its actions violate the law. Otherwise it is not.
As it pursues a series of high-profile cases against big tech companies, the Biden administration is asking courts to expand the concept of consumer harm to include issues such as privacy violations and data collection, Baer said. He says he is looking for it.
He added: “We need to broaden our perspective to consider how anti-competitive conduct that leads to invasion of private life can occur.”
Allensworth said the Biden administration is seeking to expand what evidence is considered evidence of fraud and take a broader view of consumer harm.
“The standard of proof for consumer harm that has occurred over the past 40 years has been disproportionately high,” she added.
But this strategy comes with significant risks, Hovenkamp said.
Hovenkamp said that in seeking to hit companies hard over a wide range of practices, the Biden administration could lose cases it could have won if it sought to correct more narrow, specific wrongdoings. said.
“I think the solution is to bring in a narrower case,” he added.
Allensworth and Baer acknowledged the difficulty of antitrust litigation and said the outcome could depend on courts' willingness to adapt the law to modern industry.
“They have the power to tailor antitrust laws to the policy needs of the moment,” Allensworth said. “I'll have to take a look.”
