Big Tech Unites to Thwart Bipartisan Legislation

This week, a legislative effort to control the biggest tech companies in the nation, which was driven by both sides of the political aisle, failed due to a massive lobbying effort by Amazon, Apple, Google, and Meta.

Internet giants invested hundreds of millions of dollars, sent their CEOs to Washington, and employed trade groups and supportive scholars to try to stop two antitrust bills co-sponsored by Senator Amy Klobuchar, a Democrat from Minnesota, and Senator Chuck Grassley, a Republican from Iowa. The companies viewed the bills as a major danger. This US legislative effort, which was sparked by the public's anger over the power and control of tech companies, would have been the first time in almost thirty years that Alphabet Inc.'s Google, Amazon.com Inc, Meta Platforms Inc. and Apple Inc. were held accountable for their practices since the internet was made available to the public.

Two bills, the American Innovation and Choice Online Act and the Open App Markets Act, advanced further than any other antitrust overhaul in decades. This was due to an 18-month House investigation led by Rhode Island Democrat David Cicilline. The bills would have prevented tech giants from using their platforms to disadvantage competitors, and would have limited Apple and Google's control over app stores. Despite a last-minute push, the bills were not included in the end-of-year spending package released Monday. The Senate did include a narrower trio of antitrust bills in the package, which will give more money and resources to the country's top antitrust regulators. This marks the first time Congress has voted to expand antitrust enforcement measures in decades, though the provisions will not make the sweeping changes to the law that some advocates hoped for.

Businesses in Europe have had to adjust their practices to abide by the European Union's regulations that will be implemented in the near future. Supporters in the United States are hopeful that the same will occur in their country, but it will take some time.

The opposition campaign used different points of emphasis to appeal to both Democrats and Republicans. They argued to Democrats that the bills would have a negative impact on minority groups and reduce online privacy, while they highlighted free speech and free markets to Republicans.

Senate Majority Leader Chuck Schumer, whose daughters are employed by Amazon and Meta, chose not to bring the measures to the floor this session, citing a lack of votes despite the co-sponsors of the bill claiming they had enough backing. Furthermore, key Republican House leaders have made it clear that the legislation will not be addressed when they regain control of the lower chamber.

This report was compiled from 45 conversations with legislators, congressional staff, lobbyists, technology specialists, and activists.

The bills ultimately failed due to a variety of reasons, such as partisan gridlock, personal animosity among lawmakers, more pressing legislative matters, inaction from Schumer, and Klobuchar's perceived rigidity. However, the lobbying efforts were immense.

Jane Meyer, a spokeswoman for Klobuchar, noted that large tech companies have invested a considerable amount of money in an effort to prevent any advancement in tech policy in Washington. She further stated that Klobuchar and the bill's House and Senate co-sponsors refused to be deterred by this aggressive approach.

The bills had a strong backing. A coalition of smaller tech companies, civil society organizations, and companies owned by Rupert Murdoch put in a lot of effort to promote them. Fox and News Corp., which have had a long-standing rivalry with Google over its control of search and news distribution, worked to get Republicans to support the bills. The small tech companies and consumer groups invested $2 million in advertisements, made their presence known on Capitol Hill, and organized multiple protests.

They were not prepared for the challenge they faced.

The major tech companies put aside their differences and worked together. They and their respective trade organizations invested more than $100 million in lobbying over a two-year period, surpassing other high-spending industries such as pharmaceuticals and defense. They gave more than $5 million to politicians, and tech lobbyists bundled more than $1 million to the PAC responsible for protecting the Democrats' majority. Additionally, they put millions more into dark-money groups, nonprofits, and trade associations that do not have to reveal the source of their funding. Several congressional aides reported that they received more outreach on the bills than any other they had worked on in years.

Businesses invested $130 million in promotional efforts, mainly focusing on battleground states like Georgia, New Hampshire, and Arizona, as reported by AdImpact, an ad analytics service. A lot of the ads suggested that if Democrats backed the bill, they could lose the Senate and Republicans could miss out on a legislative majority.

The campaign contended that the bills would have a detrimental effect on Google Search and Amazon Prime, and could potentially disrupt the global economy. Amazon and Connected Commerce, a tech-funded nonprofit, brought numerous small business owners to Washington to express their concerns about the potential negative consequences. Google employed former national security officials to express their opinion that the bills could be a threat to national security. Apple funded the Taxpayers Protection Alliance to initiate the "App Security Project," which argued that the bills would make phones more susceptible to hacking and spying.

The highest-ranking officials of the two companies were present in the halls. Tim Cook, the CEO of Apple, and Sundar Pichai, the CEO of Google, conversed with members of the Senate Judiciary Committee, including Chris Coons, a Democrat from Delaware who is a strong supporter of President Joe Biden.

Senator Coons commented in an interview that there has been a great deal of pressure to oppose the proposed legislation. He noted that many people have been exposed to a multitude of television commercials, emails, and social media posts. He further expressed understanding for the tech leaders' apprehensions, including the idea that the bills could put the United States at a disadvantage in comparison to China.

The American Innovation and Choice Online Act was approved by a vote of 16-6 during markup. However, a few Democrats, echoing the arguments of large tech companies, requested that Senator Klobuchar address their worries.

A coalition of small tech companies, including Yelp Inc., DuckDuckGo, and Proton AG, joined forces with civil society groups to form an "anti-big tech" infrastructure. Every Friday, they meet to discuss strategies. According to Kate McInnis, senior public policy manager at DuckDuckGo, it was a "historic moment".

In early February, the Open App Markets Act was approved by the Senate Judiciary Committee with a 20-2 vote. However, some disagreements arose during the process. John Kennedy, a conservative Republican from Louisiana, expressed his discontent with Senator Klobuchar. He stated, "I'm fed up with being told that if I ask a question, I'm in the pocket of big tech."

Kennedy later informed his allies that he was no longer in favor of the proposal. In an interview, he stated, "It's not effective to try and pressure senators into agreeing with something. They will either reject it or reject it completely." Despite Grassley's belief that there were 20 Republican votes, more GOP senators withdrew their backing.

In February, senators Coons, Leahy, and Ossoff proposed modifications to issues such as privacy and cybersecurity, which had been brought up by the companies. However, they were unable to get Klobuchar's office to make any major alterations.

Senator Klobuchar's office reported that they had implemented more than 150 modifications to her bill, some of which were based on input from other offices.

At the same time, a large number of advertisements were seen in states with Democratic candidates who were in danger of losing.

Maggie Hassan of New Hampshire and Mark Kelly of Arizona both advocated for Senate leadership to postpone voting on the bills until after the elections had taken place. This was in order to fulfill their purpose.

In March, Senator Schumer's office promised to present the proposed legislation to the floor, but they informed the supporters of the bills that they had to demonstrate they had the required 60 votes.

In the later part of spring, a collection of internet law scholars, some of whom had been supported by Google, contended that the bill could have an impact on the tech companies' capacity to take out false information and hate speech from their websites. This was a serious issue.

Four Democratic senators started to urge Klobuchar to revise the legislation. Her team discussed new wording. However, the compromise was not successful: If Klobuchar made alterations related to speech, the bill would not have the support of Republicans. Without the changes, Democrats refused to support it.

Advocates of the cause kept up the pressure throughout the autumn months with demonstrations, advertisements, open letters, and meetings on Capitol Hill. However, by the time November rolled around and Senator Klobuchar attended a book party, it was becoming increasingly evident that the fight was coming to an end. At the event, she declared that she would do her best to pass the proposed legislation.

Congressman Cicilline expressed his disappointment that Senator Schumer did not bring the bills up for a vote. He went on to say that it was "just wrong".

Supporters are coming together again, full of optimism.

Alex Harman of the Economic Security Project commented that "big tech is merely postponing the unavoidable, and the greater battle persists." He went on to say that "they are not succeeding, they are just losing at a slower rate."