Tag: Monopoly

So Says the ASSLaw Fellow

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Jan Rybnicek, an antitrust attorney and a Senior Fellow at the Global Antitrust Institute of the Antonin Scalia School of Law (ASSLaw) has taken issue with both the Biden administration and in Congress to restrict mergers in the name of increasing competition in the marketplace.

She states that slowing the paces of M&A activity will reduce employment in the United States, despite the fact that mergers result in massive job cuts more often than not.

In fact the only areas of the economy that might see reductions in employment are beyond brokers and lawyers, so how could anyone claim with a straight face that this would cause job losses.

It’s almost as if the person writing this is an M&A lawyer, and ……… Checks Notes ……… never mind.

Antitrust Smoking Gun

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It turns out that Google and Facebook colluded to keep Facebook out of the advertising market in exchange for preferential rates.

This is pretty much a slam dunk, and yes, both organizations should broken up in the long term (Other limits fail over time) and be prevented from acquiring any other companies in the short term:

In 2017, Facebook said it was testing a new way of selling online advertising that would threaten Google’s control of the digital ad market. But less than two years later, Facebook did an about-face and said it was joining an alliance of companies backing a similar effort by Google.

Facebook never said why it pulled back from its project, but evidence presented in an antitrust lawsuit filed by 10 state attorneys general last month indicates that Google had extended to Facebook, its closest rival for digital advertising dollars, a sweetheart deal to be a partner.

Details of the agreement, based on documents the Texas attorney general’s office said it had uncovered as part of the multistate suit, were redacted in the complaint filed in federal court in Texas last month. But they were not hidden in a draft version of the complaint reviewed by The New York Times.

Executives at six of the more than 20 partners in the alliance told The Times that their agreements with Google did not include many of the same generous terms that Facebook received and that the search giant had handed Facebook a significant advantage over the rest of them.

………

The disclosure of the deal between the tech giants has renewed concerns about how the biggest technology companies band together to close off competition. The deals are often consequential, defining the winners and losers in various markets for technology services and products. They are agreed upon in private with the crucial deal terms hidden through confidentiality clauses.

Google and Facebook said that such deals were common in the digital advertising industry and that they were not thwarting competition.

………

The Wall Street Journal had reported on aspects of the draft complaint earlier.

………

“This idea that the major tech platforms are robustly competing against each other is very much overstated,” said Sally Hubbard, a former assistant attorney general in New York’s antitrust bureau who now works at Open Markets Institute, a think tank. “In many ways, they reinforce each other’s monopoly power.”

Because maintaining a monopoly is more profitable than developing a superior product.

One need only look at the cost and speed of broadband in the US to know that this is true.
The agreement between Facebook and Google, code-named “Jedi Blue” inside Google, pertains to a growing segment of the online advertising market called programmatic advertising. Online advertising pulls in hundreds of billions of dollars in global revenue each year, and the automated buying and selling of ad space accounts for more than 60 percent of the total, according to researchers.

In the milliseconds between a user clicking on a link to a web page and the page’s ads loading, bids for available ad space are placed behind the scenes in marketplaces known as exchanges, with the winning bid passed to an ad server. Because Google’s ad exchange and ad server were both dominant, it often directed the business to its own exchange.

A method called header bidding emerged, in part as a workaround to reduce reliance on Google’s ad platforms. News outlets and other sites could solicit bids from multiple exchanges at once, helping to increase competition and leading to better prices for publishers. By 2016, more than 70 percent of publishers had adopted the technology, according to one estimate.

Seeing a potentially significant loss of business to header bidding, Google developed an alternative called Open Bidding, which supported an alliance of exchanges. While Open Bidding allows other exchanges to simultaneously compete alongside Google, the search company extracts a fee for every winning bid, and competitors say there is less transparency for publishers.

The threat of Facebook, one of the biggest ad buyers on the internet, supporting header bidding was a grave concern at Google. The draft of the complaint reviewed by The Times cited an email from a Google executive calling it an “existential threat” that required “an all hands on deck approach.”

………

Before Google and Facebook signed the deal in Sept. 2018, Facebook executives outlined the company’s options to Mark Zuckerberg, its chief executive, according to the draft of the complaint: hire hundreds more engineers and spend billions of dollars to compete against Google; exit the business; or do the deal.

………

Facebook disclosed that it had joined Google’s program in one line in a Dec. 2018 blog post. But it did not reveal that Google, according to the draft complaint, provided Facebook with special information and speed advantages to help the company succeed in the auctions that it did not offer to other partners — even including a guaranteed “win rate.”

In this market, where fractions of a second count, a speed advantage was decisive. Facebook had 300 milliseconds to bid for ads, according to court documents. But the executives at Google’s partner companies said they usually had just 160 milliseconds or less to bid.

Facebook had yet another advantage: Direct billing relationships with the sites where ads would appear, according to the court documents. For most other partners, Google controlled pricing information, effectively putting up a wall between Open Bidding participants and site owners and hiding how much of winning bids sites end up receiving, the executives at other companies said.

………

Facebook promised to bid on at least 90 percent of auctions when it could identify the end user and committed to spending a certain amount of money — as much as $500 million a year by the fourth year of the agreement, according to the draft of the complaint. Facebook also demanded that data about its bids not be used by Google to manipulate auctions in its own favor, a level playing field not explicitly promised to other Open Bidding partners.

Perhaps the most serious claim in the draft complaint was that the two companies had predetermined that Facebook would win a fixed percentage of auctions that it bid on.

“Unbeknown to other market participants, no matter how high others might bid, the parties have agreed that the gavel will come down in Facebook’s favor a set number of times,” the draft complaint said. A Google spokeswoman said Facebook must make the highest bid to win an auction, just like its other exchange and ad network partners.

While both companies said that the deal is not an antitrust matter, they included a clause in the agreement that requires the parties to “cooperate and assist” each other if they are investigated for competition concerns over the partnership.

“The word ‘antitrust’ is mentioned no less than 20 times” throughout the agreement, the draft complaint said.

Seriously, this is not just unlawful, this is an actual criminal offense.

Executives used to be jailed for this sort of crap, at least until the 1980s, when Reagan gutted antitrust enforcement.

I’d like to see Sundar Pichai, Sergey Brin, Larry Page, Mark Zuckerberg and Sheryl Sandberg frog marched out of the corporate offices in handcuffs.

Finally,

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The Federal Trade Commission and 47 states have filed a lawsuit to break up Facebook.

This is long overdue.

As an aside, at the top of the list should be the replacement of all the class B shares of Facebook, the ones with special voting rights that allow Zuckerberg to maintain complete control of the company, with class A shares, at least on a temporary basis.

Mark Zuckerberg’s 58% of the vote would become 5.8% of the vote, and the slightly less psychopathic “adults in the room” could deal with take charge.

A breakup will take years and millions of dollars. Changing the class of shares could be done almost instantly, and the the cost of this would be minimal.

The lawsuit is calling for Instagram and WhatsApp to be spun out from Facebook:

The Federal Trade Commission and a coalition of 47 states attorneys general today filed a pair of long-awaited antitrust suits against Facebook, alleging that the company abused its power in the marketplace to neutralize competitors through acquisitions and prevent anyone else from presenting a more privacy-friendly alternative to consumers.

“By using its vast troves of data and money, Facebook has quashed or hindered what the company perceived as potential threats,” New York Attorney General Letitia James, who led the states’ effort, said. “In an effort to maintain its market dominance, Facebook has employed a strategy to impede competing services.”

The lawsuit brought by the states (PDF) asks the court to prohibit Facebook from engaging in “any anticompetitive conduct” or practice going forward. That includes a request for Facebook to be blocked from any acquisitions valued at greater than $10 million without first getting permission from the states.

The states also explicitly ask that Facebook’s acquisitions of Instagram and WhatsApp be found in violation of the Clayton Act and that Facebook be required to divest those businesses if necessary “to restore competitive conditions” in the marketplace.

The suit filed by the FTC (PDF) also calls for Facebook to face more scrutiny when it acquires other firms and to be broken up if necessary to restore competition in the marketplace.

………

As we’ve explained before, antitrust law isn’t just about being a literal monopoly or even about being the biggest player in a sector. Instead, it’s about power—how much you have, and what you do with it. Antitrust investigators basically want to answer the question: did you become the biggest naturally, or did you cheat along the way?

In that framing, then, Facebook stands accused of cheating to beat out any potential competition—a lot.

………

Emails obtained by Congress earlier this year as part of its investigation into Big Tech’s outsized power revealed that Zuckerberg explicitly thought of Instagram as a threat before acquiring it.

If apps such as Instagram were allowed to grow, Zuckerberg wrote in a 2012 email, it “could be very disruptive” to Facebook, and he added that an acquisition “will give us a year or more to integrate their dynamics before anyone can get to their scale again.”

………

The FTC and the states both launched their antitrust investigations back in the long-long ago of 2019, as did Congress, European Union competition regulators, and regulators from several other nations. The Congressional report, published in October, now seems like a harbinger of today’s suit: the House committee found that Facebook (as well as Apple, Google, and Amazon) exerts monopoly power in the marketplace and should be forced to split up.

It’s incredibly rare in the modern era for the courts actually to force a company to break up for antitrust reasons. The last major breakup came more than 35 years ago, when AT&T finally split up in to the seven regional “Baby Bells” after a decade-long legal fight with the Justice Department. The court initially ordered a breakup in the Microsoft antitrust case that began in the late 1990s, but Microsoft appealed the ruling and, in 2001, reached a settlement with the DOJ that left its business intact.

Some of Facebook’s app updates from earlier this year seem to have been designed with a potential antitrust suit in mind: the company in late 2019 began a plan to integrate WhatsApp, Facebook Messenger, and Instagram Direct messaging into a single service. The integration between Instagram’s and Facebook’s messaging services began in August; when all three platforms are combined, Facebook will reach an estimated 3.3 billion users on a single messaging service.

Which is, in and of itself, evidence of bad faith and monopolistic behavior.

………

“The claims being reported—serial predatory acquisition and withholding interoperability—set up a strong case,” said Charlotte Slaiman, competition policy director at Public Knowledge. “This action reflects a lot of work from advocates, experts, and enforcement officials to build the case, first that Facebook was deserving of scrutiny, and then that the company really has run afoul of our antitrust laws. To fix the harms to competition, we need to see changes to Facebook’s business and the company should be required to open up its network to competitors so that users are not locked in.”

Whatever the plaintiffs are trying to achieve, they have to be as disruptive as possible to Facebook, because otherwise, they are going to pull crap that makes IBM’s shenanigans in its antitrust defense look like tiddly winks.

*At one point, IBM literally submitted trailer loads of documents as evidence as a delaying tactic.  The lawsuit spanned 3 decades.

Kill it With Fire

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In response to the anti-trust lawsuit filed against it, Google will no longer give favorable placement to media outlets that use its AMP HTML dialectt.

This is a good thing.

First, AMP sucks, second, it was an invitation for Google to violate user privacy and extend its ad and search monopolies, and third, AMP sucks:

Four years after offering special placement in a “top stories carousel” in search results to entice publishers to use a format it created for mobile pages, called AMP, Google announced last week that it will end that preferential treatment in the spring.

“We will prioritize pages with great page experience, whether implemented using AMP or any other web technology, as we rank the results,” Google said in a blog post.

The company had indicated in 2018 that it would drop the preference eventually. Last week’s announcement of a concrete timeline comes less than a month after the Department of Justice called Google a “monopoly gatekeeper to the internet” in a lawsuit alleging antitrust violations and as pressure mounts on officials in the European Union, which has already fined Google more than $9 billion for antitrust violations.

“I did always think AMP posed antitrust concerns,” said Sally Hubbard, author of the book “Monopolies Suck” and an antitrust expert with the Open Markets Institute. “It’s, ‘If you want to show up on the top of the search results, you have to play by our rules, you have to use AMP.’ ”

………

Whatever prompted the timing of the change, some news sites are relieved that they won’t have to keep using Google’s preferred mobile standard.

“We are encouraged to see Google beginning to outline a path away from AMP,” Robin Berjon, head of data governance at The New York Times, said in a written statement in response to questions from The Markup. “It’s important Google addresses the core challenge with the format, so that it is no longer a requirement for news products and performance ranking.”

News publishers and others have been griping about AMP for years. Some called it Google’s attempt to exert the same kind of control over the larger web that Facebook exerts over posts in its closed system.

That’s because AMP is more than just a set of formatting rules. Once a website sets up an AMP page, Google copies it and stores it on Google servers. When users click on the link for an AMP page in search results—or its news reading app—Google serves up that cached version from its servers.

“AMP keeps users within Google’s domain and diverts traffic away from other websites for the benefit of Google,” read a 2018 open letter signed by more than 700 technologists and advocates. “At a scale of billions of users, this has the effect of further reinforcing Google’s dominance of the Web.”

………

In an analysis published by The Markup earlier this year of 15,269 popular searches on Google, we found that AMP-enabled results appeared often, taking up more than 13 percent of the first results page. Google took another 41 percent of the page for its own products.

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As the news industry struggled over the past decade, with dropping newspaper subscription rates and ad revenue and plateauing online traffic leading to massive job losses, many publishers adopted AMP in hopes that it would help their bottom lines. Most of the roughly 2,000 members of the News Media Alliance, a trade organization that represents newspapers, use it.

“They don’t really feel there is a choice,” said Danielle Coffey, the group’s general counsel and senior vice president.

Her opinion is widely shared.

“We essentially have a coercion by Google upon publishers to allow people to host their content,” said Andrew Betts, a former member of the Technical Architecture Group at the international web standards organization W3C, who has written about his concerns with AMP. “And publishers who decide they don’t want that to happen because they want to serve their own content, thanks very much, will not ever appear in the first set of search results.”

………

And AMP sometimes causes issues that publishers lack the power to fix on their own. In one prominent example, publishers discovered there was no way to allow users to opt out of having their data sold, a requirement under the California Consumer Privacy Act, which went into effect this year.

Talk about burying the lede.

AMP allows Google to take control of user data from media outlets.

Now we know why Google pushed it so hard, they wanted to slurp up more user data.

I Learned 2 Things Today

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The first is that when you clear private data from the Chrome browser it keeps data for Google and Youtube, which is owned by Google.

The second, and completely related thing that I learned today is that the DoJ has finally filed an anti-trust lawsuit against Google.

I’m a bit dubious of the lawsuit, it reeks of William Barr rat-f%$#ery, it appears to be timed to maximize the political benefit to Trump and his Evil Minions™, but it’s been pretty clear for a while that much of tech company profitability is based on extracting monopoly rents.

I do hope that Google, and Facebook, and (particularly) Amazon get nailed to the wall, but I think that this effort is more likely to benefit the monopolists than reign them in:

The Justice Department accused Google on Tuesday of illegally protecting its monopoly over search and search advertising, the government’s most significant challenge to a tech company’s market power in a generation and one that could reshape the way consumers use the internet.

In a much-anticipated lawsuit, the agency accused Google of locking up deals with giant partners like Apple and throttling competition through exclusive business contracts and agreements.

………

“For many years,” the agency said in its 57-page complaint, “Google has used anticompetitive tactics to maintain and extend its monopolies in the markets for general search services, search advertising and general search text advertising — the cornerstones of its empire.”

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Google called the suit “deeply flawed.” But the agency’s action signaled a new era for the technology sector. It reflects pent-up and bipartisan frustration toward a handful of companies — Google, Amazon, Apple and Facebook in particular — that have evolved from small and scrappy companies into global powerhouses with outsize influence over commerce, speech, media and advertising. Conservatives like President Trump and liberals like Senator Elizabeth Warren have called for more restraints over Big Tech.

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………

Democratic lawmakers on the House Judiciary Committee released a sprawling report on the tech giants two weeks ago, also accusing Google of controlling a monopoly over online search and the ads that come up when users enter a query.

“A significant number of entities — spanning major public corporations, small businesses and entrepreneurs — depend on Google for traffic, and no alternate search engine serves as a substitute,” the report said. The lawmakers also accused Apple, Amazon and Facebook of abusing their market power. They called for more aggressive enforcement of antitrust laws, and for Congress to consider strengthening them.

………

………

He put the investigation under the control of his deputy, Jeffrey Rosen, who in turn hired Mr. Shores, an aide from a major law firm, to oversee the case and other technology matters. Mr. Barr’s grip over the investigation tightened when the head of the Justice Department’s antitrust division, Makan Delrahim, recused himself from the investigation because he represented Google in its acquisition of the ad service DoubleClick in 2007.

………

This sort of revolving door is precisely why we haven’t seen meaningful antitrust lately:  That revolving door is tremendously lucrative.

While it is possible that a new Democratic administration would review the strategy behind the case, experts said it was unlikely that it would be withdrawn under new leadership.

Your mouth to God’s ear.

 And if you are wondering, I am VERY MUCH aware of the irony involved in my saying this on a Google owned platform.

OK, This Looks Like a Semi Serious Proposal

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Antitrust regulators are looking forcing Google to sell its chrome browser as well as parts of its advertising network.

This is a good start.

What also should be applied is the remove the special stock that gives the founders outsize voting rights.

Many of the anti-competitive behaviors flow from the belief of their founders that they are supermen beyond the limitations of mortal men, and so they need not concern themselves with the rules.

See Neumann at WeWork, Zuckerberg at Facebook, and Musk at ……… well ……… everything, as well as Page and Brin at Google.

What’s more, the recompense for the loss of these voting rights would be small, so you can do it on the cheap.

Also, prohibit any corporate acquisitions by these companies.  

As was the case with Facebook and Instagram, this was a purchase happened because Facebook was relentlessly tracking its users, and came to see it as a threat:

Regulators are considering a breakup of the Google empire, including a forced sale of its dominant web browser Google Chrome and certain aspects of its ad-tech stack.

A Politico report cites several sources with knowledge of the discussions taking place as the U.S. Department of Justice and several state attorneys general prepare to file suit against the online behemoth.

Official proceedings are expected to take place within weeks, following months of speculation over how government officials intend to rein in Google’s dominance of the $130 billion a year online advertising business—of which Google controls 37.2%.

Google Chrome commands a 66.3% share of the global web browser market, according to GlobalStats. Its ad stack, popularly referred to as DoubleClick, comprises both buy- and sell-side tools as well as its dominant ad-serving tool.

This set of tools, as well as Google’s “closed” operating model, has prompted many to accuse Google of exerting undue control over all aspects of the online advertising market (see video below), and its 2015 decision to block third-party ad-buying tools from purchasing ad space on YouTube was widely criticized.

………


The latest media reports come within a week of the House Judiciary Committee’s Subcommittee on Antitrust publishing a 449-page report roundly criticizing Amazon, Apple, Facebook and Google.

Among the recommendations in the report were that authorities impose “structural separations,” either by way of a forced sale of certain parts of each company’s assets or assurances parts of their businesses are firewalled. Other recommendations included rules to prevent “self-preferencing,” plus the promotion of “interoperability” with third parties and an overhaul of M&A laws.

………

Speaking at Adweek’s virtual NexTech conference on the same day the CEOs of Amazon, Apple, Facebook and Google were appearing before the congressional subcommittee behind last week’s report, NYU professor Scott Galloway said, “They need to be broken up.”

Facebook is Ineluctably Evil

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On a company discussion board, a Facebook employee noted that senior management had repeatedly reversed decisions to flag conservative groups and media for posting false and deceptive information, and  was promptly fired. 

So much for social media having a liberal bias.

Also, this should be a lesson for the Dems:  Oligarchs like Mark Zuckerberg care about nothing but themselves.  They are not to be trusted.

Seeing as how the US has not done what Yeltsin did when he selected his oligarchs, he overwhelmingly selected them from a despised minority, Jews, so that he would have public support if he needed to take them down.  (He didn’t, but Putin did.)

Break up Facebook:

After months of debate and disagreement over the handling of inflammatory or misleading posts from Donald Trump, Facebook employees want CEO Mark Zuckerberg to explain what the company would do if the leader of the free world uses the social network to undermine the results of the 2020 US presidential election.

“I do think we’re headed for a problematic scenario where Facebook is going to be used to aggressively undermine the legitimacy of the US elections, in a way that has never been possible in history,” one Facebook employee wrote in a group on Workplace, the company’s internal communication platform, earlier this week.

For the past week, this scenario has been a topic of heated discussion inside Facebook and was a top question for its leader. Some 2,900 employees asked Zuckerberg to address it publicly during a company-wide meeting on Thursday, which he partly did, calling it “an unprecedented position.”

………

While there are signs Facebook will stand up to Trump in cases where he violates its rules — as on Wednesday when it removed a video post from the president in which he claimed that children are “almost immune” to COVID-19 — there are others who suggest the company is caving to critical voices on the right. In another recent Workplace post, a senior engineer collected internal evidence that showed Facebook was giving preferential treatment to prominent conservative accounts to help them remove fact-checks from their content.

The company responded by removing his post and restricting internal access to the information he cited. On Wednesday the engineer was fired, according to internal posts seen by BuzzFeed News.

………

Last Friday, at another all-hands meeting, employees asked Zuckerberg how right-wing publication Breitbart News could remain a Facebook News partner after sharing a video that promoted unproven treatments and said masks were unnecessary to combat the novel coronavirus. The video racked up 14 million views in six hours before it was removed from Breitbart’s page, though other accounts continued to share it.

Zuckerberg danced around the question but did note that Breitbart could be removed from the company’s news tab if it were to receive two strikes for publishing misinformation within 90 days of each other. (Facebook News partners, which include dozens of publications such as BuzzFeed News and the Washington Post, receive compensation and placement in a special news tab on the social network.)

………

But some of Facebook’s own employees gathered evidence they say shows Breitbart — along with other right-wing outlets and figures including Turning Point USA founder Charlie Kirk, Trump supporters Diamond and Silk, and conservative video production nonprofit Prager University — has received special treatment that helped it avoid running afoul of company policy. They see it as part of a pattern of preferential treatment for right-wing publishers and pages, many of which have alleged that the social network is biased against conservatives.

………

On July 22, a Facebook employee posted a message to the company’s internal misinformation policy group noting that some misinformation strikes against Breitbart had been cleared by someone at Facebook seemingly acting on the publication’s behalf.

“A Breitbart escalation marked ‘urgent: end of day’ was resolved on the same day, with all misinformation strikes against Breitbart’s page and against their domain cleared without explanation,” the employee wrote.

The same employee said a partly false rating applied to an Instagram post from Charlie Kirk was flagged for “priority” escalation by Joel Kaplan, the company’s vice president of global public policy. Kaplan once served in George W. Bush’s administration and drew criticism for publicly supporting Brett Kavanaugh’s controversial nomination to the Supreme Court.

………

Past Facebook employees, including Yaël Eisenstat, Facebook’s former global election ads integrity lead, have expressed concerns with Kaplan’s influence over content enforcement decisions. She previously told BuzzFeed News a member of Kaplan’s Washington policy team attempted to influence ad enforcement decisions for an ad placed by a conservative organization.

Facebook did not respond to questions about why Kaplan would personally intervene in matters like this.

………

“It appears that policy people have been intervening in fact-checks on behalf of *exclusively* right-wing publishers, to avoid them getting repeat-offender status,” wrote another employee in the company’s internal “misinformation policy” discussion group.

Individuals that spoke out about the apparent special treatment of right-wing pages have also faced consequences. In one case, a senior Facebook engineer collected multiple instances of conservative figures receiving unique help from Facebook employees, including those on the policy team, to remove fact-checks on their content. His July post was removed because it violated the company’s “respectful communication policy.”

Bullsh%$.

Zuckerberg has absolute authority over Facebook, and Joel Kaplan is his guy, and has no authority beyond what Zuckerberg gives him.

Psychopaths like Mark Zuckerberg is why anti-trust law was created.

Google Being Evil

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This is not a surprise. This is what Google does, leveraging its monopoly position on search, and now online advertising, to crush competitors:

As the antitrust drumbeat continues to pound on tech giants, with Reuters reporting comments today from the U.S. Justice Department that it’s moving “full-tilt” on an investigation of platform giants including Google parent Alphabet, startups in Europe’s travel sector are dialing up their allegations of anti-competitive behavior against the search giant.

Google has near complete grip on the search market in Europe, with a regional market share in excess of 90%, according to Statcounter. Unsurprisingly, industry sources say a majority of travel bookings start as a Google search — giving the tech giant huge leverage over the coronavirus-hit sector.

More than half a dozen travel startups in Germany are united in a shared complaint that Google is abusing its search dominance in a number of ways they argue are negatively impacting their businesses.

Complaints we’ve heard from multiple sources in online travel range from Google forcing its own data standards on ad partners to Google unfairly extracting partner data to power its own competing products on the cheap.

Startups are limited in how much detail they can provide on the record about Google’s processes because the company requires advertising partners to sign NDAs to access its ad products. But this week German newspaper Handelsblatt reported on antitrust complaints from a number of local startups — including experience booking platform GetYourGuide and vacation rental search engine HomeToGo — which are accusing the tech giant of stealing content and data.

The group is considering filing a cartel complaint against Google, per its report.

We’ve also heard from multiple sources in the European travel sector that Google has exhibited a pattern of trying to secure the rights to travel partners’ content and data through contracts and service agreements.

One source, who did not wish to be identified for fear of retaliation against their business, told us: “Each travel partner has certain specialities in their business model but overall the strategy of Google has been the same: Grab as much data from your partners and build competing products with that data.”

………

Google defends this type of expansion by saying it’s just making life easier for the user by putting sought for information even closer to their search query. But competitors contend the choices it’s making are far more insidious. Simply put, they’re better for Google’s bottom line — and will ultimately result in less choice and innovation for consumers — is the core argument. The key contention is Google is only able to do this because it wields vast monopoly power in search, which gives it unfair access to travel rivals’ content and data.

It’s certainly notable that Alphabet hasn’t felt the need to shell out to acquire any of the major travel booking platforms since its ITA acquisition. Instead, its market might allow it to repackage and monetize rival travel platforms’ data via an expanding array of its own vertical travel search products.

This is why the internet giants need to be regulated as utilities, and why we should consign Robert Bork’s corrupt and ahistorical antitrust analysis needs to be put in the dust-bin of history.

So Not a Surprise

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We now have a report that Facebook fired an employee after the collected information showing that senior executives interfered with the moderation process to protect right-wing sources.

The worst offender appears to be Joel Kaplan, Facebook’s VP of Global Policy, a former member of the George W. Bush administration, but it’s clear that this has to be done with the explicit support and approval Mark Zuckerberg, given that he is a control freak who has complete control of the company.

This is why Dems need to get serious about antitrust with regard to the tech giants after the election:

After months of debate and disagreement over the handling of inflammatory or misleading posts from Donald Trump, Facebook employees want CEO Mark Zuckerberg to explain what the company would do if the leader of the free world uses the social network to undermine the results of the 2020 US presidential election.

………

For the past week, this scenario has been a topic of heated discussion inside Facebook and was a top question for its leader. Some 2,900 employees asked Zuckerberg to address it publicly during a company-wide meeting on Thursday, which he partly did, calling it “an unprecedented position.”

………

While there are signs Facebook will stand up to Trump in cases where he violates its rules — as on Wednesday when it removed a video post from the president in which he claimed that children are “almost immune” to COVID-19 — there are others who suggest the company is caving to critical voices on the right. In another recent Workplace post, a senior engineer collected internal evidence that showed Facebook was giving preferential treatment to prominent conservative accounts to help them remove fact-checks from their content.

The company responded by removing his post and restricting internal access to the information he cited. On Wednesday the engineer was fired, according to internal posts seen by BuzzFeed News.

With heightened internal tensions and morale at a low point, concerns about how the company handles fact-checked content have exploded in an internal Workplace group dedicated to misinformation policy.

Last Friday, at another all-hands meeting, employees asked Zuckerberg how right-wing publication Breitbart News could remain a Facebook News partner after sharing a video that promoted unproven treatments and said masks were unnecessary to combat the novel coronavirus. The video racked up 14 million views in six hours before it was removed from Breitbart’s page, though other accounts continued to share it.

………

But some of Facebook’s own employees gathered evidence they say shows Breitbart — along with other right-wing outlets and figures including Turning Point USA founder Charlie Kirk, Trump supporters Diamond and Silk, and conservative video production nonprofit Prager University — has received special treatment that helped it avoid running afoul of company policy. They see it as part of a pattern of preferential treatment for right-wing publishers and pages, many of which have alleged that the social network is biased against conservatives.

………

On July 22, a Facebook employee posted a message to the company’s internal misinformation policy group noting that some misinformation strikes against Breitbart had been cleared by someone at Facebook seemingly acting on the publication’s behalf.

“A Breitbart escalation marked ‘urgent: end of day’ was resolved on the same day, with all misinformation strikes against Breitbart’s page and against their domain cleared without explanation,” the employee wrote.

The same employee said a partly false rating applied to an Instagram post from Charlie Kirk was flagged for “priority” escalation by Joel Kaplan, the company’s vice president of global public policy. Kaplan once served in George W. Bush’s administration and drew criticism for publicly supporting Brett Kavanaugh’s controversial nomination to the Supreme Court.

………

Past Facebook employees, including Yaël Eisenstat, Facebook’s former global election ads integrity lead, have expressed concerns with Kaplan’s influence over content enforcement decisions. She previously told BuzzFeed News a member of Kaplan’s Washington policy team attempted to influence ad enforcement decisions for an ad placed by a conservative organization.

Facebook did not respond to questions about why Kaplan would personally intervene in matters like this.

These and other interventions appear to be in violation of Facebook’s official policy, which requires publishers wishing to dispute a fact check rating to contact the Facebook fact-checking partner responsible.

“It appears that policy people have been intervening in fact-checks on behalf of *exclusively* right-wing publishers, to avoid them getting repeat-offender status,” wrote another employee in the company’s internal “misinformation policy” discussion group.

Individuals that spoke out about the apparent special treatment of right-wing pages have also faced consequences. In one case, a senior Facebook engineer collected multiple instances of conservative figures receiving unique help from Facebook employees, including those on the policy team, to remove fact-checks on their content. His July post was removed because it violated the company’s “respectful communication policy.”

………

News of his firing caused some Facebook employees to say that they now fear speaking critically about the company in internal discussions. One person said they were deleting old posts and comments, while another said this was “hardly the first time the respectful workplace guidelines have been used to snipe a prominent critic of company policies/ethics.”

………

In other cases, Facebook itself will quietly remove a fact-check applied by one of its partners. That appears to be what happened with a March 25 post from Diamond and Silk. The duo wrote on Facebook, “How the hell is allocating 25 million dollars in order to give a raise to house members, that don’t give a damn about Americans, going to help stimulate America’s economy? Tell me how? #PutAmericansBackToWorkNow.”

In Mark Zuckerberg’s company, some animals are more equal than others.

Introducing the Mega-Morissette

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Facebook is suing the EU claiming that its Brussels’ anti-trust investigation of the social media giant’s online markets constitutes a violation Facebook’s privacy.

In related news, Mark Zuckerberg murdered his parents and asked for mercy as an orphan.

This is f%$#ed up and sh%$:

American tech giants have enjoyed a reversal of their EU legal fortunes over the past fortnight as Euro nation courts issued rulings in their favor – and now Facebook has even sued the European Union itself, alleging the political bloc’s agencies broke their own data protection rules.

Facebook filed a lawsuit against EU competition regulators on Monday alleging that enforcers were improperly seeking access to sensitive employee personal data.

The anti social media network said in a statement to financial newswire Reuters that EU regulators had made “exceptionally broad” demands for documents during an antitrust investigation into Facebook’s online marketplace.

Facebook assistant general counsel Tim Lamb was quoted as saying, apparently with a straight face: “The exceptionally broad nature of the Commission’s requests means we would be required to turn over predominantly irrelevant documents that have nothing to do with the Commission’s investigations, including highly sensitive personal information such as employees’ medical information, personal financial documents, and private information about family members of employees.”

Notwithstanding Facebook’s business model of encouraging the world’s citizens to upload such details about themselves to Facebook’s services for the company to monetise, the suit has been filed in the EU General Court in Luxembourg. It includes demands for the court to halt further EU regulatory data demands against Facebook until further notice. An EU Commission spokesman said it would defend the lawsuit.

Facebook also told the newswire that EU agents had demanded copies of any internal Facebook document containing phrases such as “not good for us”, “big question” and “shut down”, among 2,500 others.

This Is Why We Should Piss on Robert Bork’s Grave

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Robert Bork, and a collection of self-interested capitalists, rewrote antitrust law by buying the (rather small) academic antitrust law community.

Bork supplied the intellectual masturbation that has always served as a cover for the corporatist agenda.

It took anti-trust from an effort to regulate the abuse of corporate power to a a lord of the flies scenario where only an immediate increase in consumer prices was the only justification for limiting corporate power.

Amazon is the bastard child of this policy, and in what is one of the best examples of abuse of monopoly power, the online retailer used its extensive data collected from the 3rd party sellers it serves to launch competing products.

This is directly analogous to John D. Rockefeller’s owning all the oil tanker rolling stock in the United States to control the market:

Amazon.com Inc. employees have used data about independent sellers on the company’s platform to develop competing products, a practice at odds with the company’s stated policies.

The online retailing giant has long asserted, including to Congress, that when it makes and sells its own products, it doesn’t use information it collects from the site’s individual third-party sellers—data those sellers view as proprietary.

Yet interviews with more than 20 former employees of Amazon’s private-label business and documents reviewed by The Wall Street Journal reveal that employees did just that. Such information can help Amazon decide how to price an item, which features to copy or whether to enter a product segment based on its earning potential, according to people familiar with the practice, including a current employee and some former employees who participated in it.

In one instance, Amazon employees accessed documents and data about a bestselling car-trunk organizer sold by a third-party vendor. The information included total sales, how much the vendor paid Amazon for marketing and shipping, and how much Amazon made on each sale. Amazon’s private-label arm later introduced its own car-trunk organizers.

“Like other retailers, we look at sales and store data to provide our customers with the best possible experience,” Amazon said in a written statement. “However, we strictly prohibit our employees from using nonpublic, seller-specific data to determine which private label products to launch.”

Amazon said employees using such data to inform private-label decisions in the way the Journal described would violate its policies, and that the company has launched an internal investigation.

Break it up now.

Monopoly Power

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Corey Docterow has a twitter thread about how anemic monopoly enforcement may result in many thousands of deaths during the Covid-19 pandemic.

40 years ago, a fabulist named Robert Bork dreamed up an imaginary history of US antitrust law in order to justify dismantling it.

1/

— Bernie Beats Trump (@doctorow) March 29, 2020

You can follow the whole thing, but the short version is that the US government funded a small company to make an inexpensive and portable ventilators, and as they were getting near to a product, Covidien (now Medtronic) purchased the company and shut down the program because they did not want it to compete with its more expensive ventilators.

Robert Bork’s theory was that, “monopolies are only a problem when they raise prices in the short/medium term.”

We are now literally choking on Robert Bork’s dishonesty.

May Robert Bork’s perfidious work be effaced.

Docterow’s full twitter thread below:


The Irony is Delicious

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As a result of US sanctions, Huawei has been locked out of Google’s play store.

For most phone manufacturers, this would be something near to a death blow, but since Huawei is large enough to set up a rather competent app marketplace of its own, as well as being able to create its competent equivalents of Google’s services.

This has the effect of creating a parallel ecosystem for the Android operating system, which means that, because the OS is open source, Google is at risk of losing much of its control over Android, including its ability to spy on millions (billions?) of users.

So, Google has gone to the Trump administration hat in hand to roll back the sanctions and bring Huawei back into the fold:

As Huawei takes the initiative to create its own homegrown alternative to the Play Store, Google has reportedly pleaded with the White House to offer it an exemption to again work with the Chinese tech giant.

Huawei’s inclusion on the Trump administration’s Entity List has had dramatic consequences for the company’s handset business, preventing it from using Google Mobile Services (GMS) on its latest phones and tablets.

According to German wire service Deutsche Press Agentur, Android and Google Play veep Sameer Samat has confirmed that Google has applied for a licence to resume working with Huawei.

………

Huawei has said that if Google got an exemption, it would promptly update its newest phones to use Google Mobile Services.

………
That said, Huawei’s strategy has focused on hoping for the best, but preparing for the worst. These preparations have seen the firm invest over $1bn on its app ecosystem, with more than 3,000 engineers working on the AppGallery, according to a statement from the company released earlier this week.

It has also made deals with Western app developers and content providers, most notably Sunday Times publisher News UK, to make its services appear less barren.

………

Huawei has also introduced the ability to download progressive web apps, dubbed “Quick Apps” by the firm, through the AppGallery, which should bump up the app availability numbers – even if they lack the sophistication of a dedicated native app.

It’s likely this that has motivated Google to take the initiative. Although losing Huawei as a customer is a significant financial body blow to Mountain View, given its enduring popularity in Europe and Asia, it would pale compared to the damage caused by a new product that starts to loosen its stranglehold on the Android sphere.

Google Mobile Services can cost as much as $40 per device, and it’s likely that many phone vendors, particularly on the cheaper end of the spectrum, would welcome a less-expensive alternative.

Complicating matters for Google, the biggest Chinese phone manufacturers (Oppo, Xiaomi and Huawei) have teamed up to simplify the process of deploying apps to their in-house stores.

With Google claiming a cool 30 per cent on all Play Store sales, this represents a huge threat to its bottom line.

I’m kind of hoping that the request for a waiver is denied, because anything that hurts Google is good for the rest of us.

How Convenient

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As I’ve noted before, this is all about Amazon expanding its monopoly(ies):

The online retailer on Tuesday notified its third-party merchants that they could once again use FedEx’s Ground network to ship orders placed under Amazon’s Prime membership program, nearly a month after imposing a ban on the service because of performance issues.

The move ends a standoff between Amazon and onetime shipping partner FedEx, whose Ground network was blocked for the final rush before Christmas and several weeks thereafter.

An Amazon spokesman said FedEx Ground has been reinstated for Prime shipments fulfilled by third-party sellers now that the services are consistently meeting the retailer’s on-time delivery requirements.

This was not a performance issue.

Mandy Rice-Davies Applies*

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AT&T, Frontier, Windstream, and their industry lobby group are fighting against higher Internet speeds in a US subsidy program for rural areas without good broadband access.

The Federal Communications Commission’s plan for the next version of its rural-broadband fund sets 25Mbps download and 3Mbps upload as the “baseline” tier. ISPs seem to be onboard with that baseline level for the planned Rural Digital Opportunity Fund.

But the FCC also plans to distribute funding for two higher-speed tiers: namely an “above-baseline” level of 100Mbps down and 20Mbps up, and a “gigabit performance” tier of 1Gbps down and 500Mbps up. It’s the above-baseline tier of 100Mbps/20Mbps that providers object to—they either want the FCC to lower that tier’s upload speeds or create an additional tier that would be faster than baseline but slower than above-baseline.

FCC Chairman Ajit Pai has portrayed the $2 billion-per-year fund’s goal as modernizing rural broadband by bringing up-to-gigabit speeds to remote corners of the nation. Companies pushing lower standards are trying to ensure that ISPs offering much slower speeds can get a large slice of that federal funding without making significant network upgrades.

The above-baseline tier’s upload target should be 10Mbps instead of 20Mbps, according to an FCC filing on December 23 by Frontier, Windstream, and lobby group USTelecom (which represents those two providers as well as AT&T, Verizon, and others).

………

Two groups that represent smaller ISPs urged the FCC to reject calls for slower speeds. NTCA—The Rural Broadband Association and ACA Connects (formerly the American Cable Association) pointed out in a filing today that the Connect America Fund Phase II auction already included a 100Mbps/20Mbps tier.

It should surprise no one that many of the incumbents support crappier service, this is kind of their thing, because they are primarily interested in extracting monopoly rents, not providing good service.

There is a reason that companies like Comcast and Frontier and AT&T are among the most loathed in the United States.

*Well they would say that, wouldn’t they?

Paging John Sherman. Please Come to the White Courtesy Phone.

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Tell me that this is not monopoly power being abused:

Amazon.com Inc. is blocking its third-party sellers from using FedEx Corp.’s ground delivery network for Prime shipments, citing a decline in performance heading into the final stretch of the holiday shopping season.

The ban on using FedEx’s Ground and Home services starts this week and will last “until the delivery performance of these ship methods improves,” according to an email Amazon sent Sunday to merchants that was reviewed by The Wall Street Journal.

Amazon has stopped using FedEx for its own deliveries in the U.S., but third-party merchants had still been able to use FedEx. Such sellers now account for more than half of the merchandise sold on Amazon’s website, including many items listed as eligible for Prime.

FedEx said the decision impacts a small number of shippers but “limits the options for those small businesses on some of the highest shipping days in history.” The carrier said it still expects to handle a record number of packages this holiday season. “The overall impact to our business is minuscule,” a FedEx spokeswoman said.

An Amazon spokesman said the policy change is to ensure customers receive their packages on time and the e-commerce company is managing delivery cutoffs so that orders arrive by Christmas. He said the ban is temporary and will be lifted once FedEx service levels improve.

In its email to merchants, Amazon said sellers can use FedEx’s speedier and more expensive Express service for Prime orders or FedEx Ground for non-Prime shipments.

………

Earlier this year, Amazon and FedEx ended two major shipping contracts, totaling some $900 million in revenue for FedEx. The overnight-delivery pioneer is shifting its focus to retailers such as Walmart Inc. and Target Corp. that compete with Amazon.

If you believe that this was not an anti-competitive effort coming from Amazon, I have a helipad in Brooklyn that I want to sell you.

Google Is More Evil Than You Think

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It turns out that Google has been deceiving us about the level of human intervention of their search results:

Google, and its parent company Alphabet, has its metaphorical fingers in a hundred different lucrative pies. To untold millions of users, though, “to Google” something has become a synonym for “search,” the company’s original business—a business that is now under investigation as more details about its inner workings come to light.

A coalition of attorneys general investigating Google’s practices is expanding its probe to include the company’s search business, CNBC reports while citing people familiar with the matter.

………

Google’s decades-long dominance in the search market may not be quite as organic as the company has alluded, according to The Wall Street Journal, which published a lengthy report today delving into the way Google’s black-box search process actually works.

Google’s increasingly hands-on approach to search results, which has taken a sharp upturn since 2016, “marks a shift from its founding philosophy of ‘organizing the world’s information’ to one that is far more active in deciding how that information should appear,” the WSJ writes.

Some of that manipulation comes from very human hands, sources told the paper in more than 100 interviews. Employees and contractors have “evaluated” search results for effectiveness and quality, among other factors, and promoted certain results to the top of the virtual heap as a result.

One former contractor the WSJ spoke with described down-voting any search results that read like a “how-to manual” for queries relating to suicide until the National Suicide Prevention Lifeline came up as the top result. According to the contractor, Google soon after put out a message to the contracting firm that the Lifeline should be marked as the top result for all searches relating to suicide so that the company algorithms would adjust to consider it the top result.

Or in another instance, sources told the WSJ, employees made a conscious choice for how to handle anti-vax messaging:

………

The company has since maintained an internal blacklist of terms that are not allowed to appear in autocomplete, organic search, or Google News, the sources told the WSJ, even though company leadership has said publicly, including to Congress, that the company does not use blacklists or whitelists to influence its results.

The modern blacklist reportedly includes not only spam sites, which get de-indexed from search, but also the type of misinformation sites that are endemic to Facebook (or, for that matter, Google’s own YouTube).

We already know that algorithms tend to reinforce, rather than mitigate, human bias and bigotry.

Now we know that there are discrete human fingers on the scales.

This is why we need real antitrust enforcement.

Yassss!

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Be still my beating heart:

Bernie Sanders, if he were elected president, would revive the criminal provisions of the Sherman Antitrust Act to prosecute CEOs who have illegally monopolized a market, he told The Intercept in an interview.

The Sherman Act is the Department of Justice’s main tool for enforcing antitrust laws, which are meant to prevent monopolies from dominating an industry, which harms workers, consumers, and other businesses. It has both civil and criminal provisions, though in recent years, prosecutors have relied only on its civil provisions, with the intent of breaking up monopolies and opening markets.

Asked if the criminal provisions, which could see a CEO locked up for 10 years if intent to engage in unfair restrictions on trade can be proven, Sanders said, “Damn right they should be.”

………

Major Sherman Act civil cases reshaped the American economy in the 20th century — particularly the breakup of AT&T in 1984, which paved the way for the rise of Silicon Valley. Civil prosecutions scare business leaders as a business matter, while criminal prosecutions, which have been sparse, frighten them personally.

Your mouth to God’s ear.

“Roosevelt’s antitrust chief Thurman Arnold used to criminally indict business executives and fingerprint them like ordinary executives,” said Matt Stoller, whose new book “Goliath: Hundred Year War Between Monopoly Power and Democracy” chronicles these battles. (Arnold was an assistant attorney general who led the Justice Department’s antitrust division.) “As soon as he did this, amazingly, monopolistic practices in those industries would cease.”

Which is why the spectacle of business leaders being frog-marched out of their offices in handcuffs should become a routine sight.

Without personal consequences for CEOs and their ilk, they take their slap on the wrist, take their 8 figure bonuses, and do it all over again.

So Not a Surprise

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In an acknowledgement of reality, a federal court has ruled that the FCC ignored reality in order to relax media ownership rules:

The FCC’s multi-year effort to kill media consolidation rules at the behest of giants like Sinclair Broadcasting has been rejected by the courts, who ruled the agency failed to seriously consider the negative impact unchecked media monopolies have on the public at large.

 In a 2-1 new ruling, the U.S. Court of Appeals for the Third Circuit forced the FCC to go back to the drawing board in its quest to make life easier for media giants, arguing the agency “did not adequately consider the effect its sweeping rule changes will have on ownership of broadcast media by women and racial minorities.”

……

The court today agreed, stating that FCC analysis justifying its decision was “so insubstantial that it would receive a failing grade in any introductory statistics class.”

I’m shocked that Ajit Pai shirk his moral and statute obligations in this manner……….NOT.