Why “fake news” is an antitrust problem

By Sean Illing, VOX

Five of the world’s largest companies by market capitalization are tech companies. In the past 10 years, Apple, Google, Amazon, and Facebook have all joined Microsoft at the top of the list.

Each of these companies dominates its primary market, and is gradually expanding its reach into secondary markets. Have they become too big? Are they full-fledged monopolies at this point? And if so, should we rein them in?

To get answers to these questions, I reached out to Sally Hubbard, a senior editor of tech antitrust enforcement at the Capitol Forum, a nonpartisan legal investigative company that offers analysis to policymakers and industry stakeholders. I asked her to walk me through the case for using antitrust laws to regulate the major tech companies.

Antitrust laws exist in order prevent monopolization, which occurs when a company so dominates a market that it effectively eliminates the possibility of competition. This is tricky when it comes to a tech company like, say, Google, which has a monopoly in the search market but not in the digital advertising market.

Antitrust enforcement, at least in the past 40 years or so, has focused on protecting consumers from high prices due to a lack of competition. But the problems created by tech monopolies are different: Consumers aren’t paying higher prices to use these platforms, but they are handing over massive amounts of personal data and allowing companies like Facebook and Google to disproportionately influence the news and information Americans consume.

We don’t need to bust up these companies, Hubbard says, but there are very good reasons to use antitrust law to promote more competition in this space. “Fake news,” she told me, “is partly an antitrust problem” because the dominant algorithms of Facebook and Google control the flow of information. If there were more competition, purveyors of fake news would have to figure out how to game more algorithms.

Our full conversation, lightly edited for clarity, appears below.

Are the big tech companies monopolies?

Sean Illing

Can you make the case to me for why big tech companies like Facebook or Amazon or Google should be treated like monopolies?

Sally Hubbard

Monopoly enforcement is often about ensuring fair competition. One of the main arguments is that these platforms have gotten so large that they actually compete with companies that depend on their platforms to exist in the marketplace. This is what I call “platform privilege,” which is really the ability to prioritize their own products over those of competitors.

We’re seeing that in the Google Shopping case that the European Union has brought, where Google allegedly gave priority to its own comparison shopping services on its dominant search engine, so that its own Google Shopping comparison shopping service showed up first and other competitors that had comparison shopping services got put on page four.

Sean Illing

So these companies have gotten so large, so influential, that they’ve distorted competition in the markets they touch?

Sally Hubbard

That’s certainly one argument. I do think a privileged platform is a distortion of competition. You don’t have a level playing field when you’re competing against the company that determines whether you even reach the universe. What we ideally want is a marketplace where these products can come and they can compete on their merits against a huge company like Google, but if Google has the power to squeeze out competitors by placing their results at the bottom of search engines, that’s a problem for innovation, for a robust marketplace that is supposed to thrive on competition.

The promise of the internet was that it was going to be a level playing field where someone could start their business in their garage and there would be opportunities for them to enter the market. If these platforms have the ability to bury a competitor, that promise is dead.

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