Seattle U prof on what to expect from the government’s antitrust crackdown

Jun 5, 2019, 3:01 PM

Should the U.S. government break up Amazon and Google? That’s the question plenty of politicians — particularly candidates for president — are raising about a handful of tech companies.

Amazon, Google, Facebook and Apple are currently being scrutinized by government agencies. Antitrust expert Professor John Kirkwood at Seattle University joined Seattle’s Morning News with Dave Ross to explain why the business practices of these companies are being looked at now.

“What’s causing this is both politics and economics. Politically both from the left and the right there’s rising concern about the power of these giant firms,” he said. “And economically we’re increasingly realizing that America has a market power problem and it ought to ramp up anti-trust enforcement.”

Is there anti-competitive practice going on here that’s similar to the actions taken against Microsoft to force them to separate Explorer from the operating system?

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“There aren’t, to my knowledge, any allegations that any of these big four firms are trying to stifle competition with their basic service like Google in search or Amazon in online retail,” Professor Kirkwood said. “The allegations that I’m aware of have to do with much smaller kinds of activities, for example that Amazon may have prevented firms from competing with its private label products, or that Google is skewing its search results to favor its travel services over a competing travel service.”

Professor Kirkwood believes this could be good news for startup companies, as well as consumers.

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“I think it’s good news for consumers because I think the agencies are going to try to do this on the merits, and I don’t think investors should be terribly worried at this point, despite the impact on the stock so far,” he said. “It’s probably unlikely that anything major is going to happen to any of these companies.”

What would potentially happen is that Google might be required to not discriminate in favor of its own products. With Facebook, the government could examine whether its acquisitions of Instagram and WhatsApp should not have been allowed, and Apple might be scrutinized to see whether its app store were operated in a way that discriminates against competitors.

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Regardless, Professor Kirkwood doesn’t believe this is about the Trump administration trying to bite back, and that this will be decided on the merits of these companies’ conduct.

“There’s not only not any evidence that the White House got involved here, but that the people running the antitrust division and the FTC are accomplished professionals who are going to make these decisions almost certainly on the merits.”

Listen to Seattle’s Morning News weekday mornings from 5-9 a.m. on KIRO Radio, 97.3 FM. Subscribe to the podcast here.

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Seattle U prof on what to expect from the government’s antitrust crackdown