A bipartisan Senate antitrust bill aimed at reining in Big Tech’s ‘self-preferencing’ behavior passed the Senate Judiciary Committee Thursday and will head to the Senate floor.
The vote means the bill, which would be a significant setback for the tech giants and their business models, is one step closer to becoming law.
The Senate bill, the American Innovation and Choice Online Act, which passed the committee 16-6, would prevent tech giants such as Amazon, Google, and Apple from unduly favoring their own products on their platforms and services or creating cheaper copycats of existing products using internal data.
One of the main co-sponsors of the legislation, Republican Sen. Chuck Grassley of Iowa, said Thursday that the bill “will create a level playing field for smaller businesses and prevent abuse from dominant platforms. It’s an important step in putting checks on [the] growing power of Big Tech over what we buy, see, read, and say online.”
The bill was opposed by six Republicans: Sens. Mike Lee of Utah, John Cornyn of Texas, Ben Sasse of Nebraska, Tom Cotton of Arkansas, Thom Tillis of North Carolina, and Marsha Blackburn of Tennessee.
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All 11 Democrats on the Senate committee were in favor of the bill, including Sens. Dianne Feinstein and Alex Padilla of California, the home of Silicon Valley, both of whom voted to move the legislation out of committee even though they made comments that they oppose the bill.
The bill was also supported by Republican Sens. Lindsey Graham of South Carolina, Ted Cruz of Texas, Josh Hawley of Missouri, and John Kennedy of Louisiana.
The bill would empower the federal government’s antitrust enforcers, such as the Federal Trade Commission and the Justice Department, to sue the tech giants for instances of self-preferencing behavior outlined in the bill. If they are found guilty in court, companies could be fined up to 15% of their total U.S. revenues earned during the period when the illegal conduct was occurring.
Only conduct that materially harms competition in the ways specified in the bill would be restricted, the bill’s supporters say. One example would be abusing a business’s data to compete against it, which Amazon has been accused of doing. Another example would be forcing a business to buy the parent platform’s services in order to get preferred placement. Businesses would also be barred from ensuring that they benefit from search results on their own platforms, as well as restricting certain businesses’ products from functioning fully within the platform.
However, the Big Tech companies and consumer advocate groups say the bill would kill many popular tech offerings, such as Amazon’s Prime shipping and Basics product line, as well as significantly diminishing Google’s search feature.
The tech giants and mom-and-pop shops that rely on Big Tech platforms say the language in the bill is too vague and ambiguous in how it defines “unfair” self-preferencing behavior and could unintentionally ruin the tech business models that millions of organizations rely on.
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Multiple amendments to improve the bill, from both parties, are expected in the coming weeks before the bill is put to a vote on the Senate floor.
