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August 6, 2020updated 07 Aug 2020 12:38pm

EU Amazon report promises more focus than US subcommittee

By MarketLine

The US subcommittee hearing on Big Tech’s antitrust violations made strong allegations, but an upcoming report from the EU into Amazon promises more focus.

The US antitrust subcommittee hearing on 29 July levelled many strong allegations against the CEOs of Amazon, Apple, Google and Facebook, focusing mainly on illegal uses of data and acquisitions.

Misconduct on the part of these four tech giants is now undeniable, but will have done little to advance the case in the US for ‘breaking them up’.

The ‘Break Up Big Tech’ lobby in the US is weak, because of the difficulty of linking data-driven antitrust practices to the size of the companies.

As such, these are practices which require targeted regulation, not an over-simplistic breakup of their many subsidiaries.

Amazon especially has little to fear from the ‘break up’ lobby, since its subsidiaries are practically irrelevant to the antitrust violations that form the foundation of the case against it.

The EU is taking a different approach with Big Tech companies

Following the US hearing, the European Commission’s (EC) digital chief Margrethe Vestager called for a “common vision” between the EU and the US regarding tech regulation.

This reflects the critical difference of approach taken in the EU, where ‘breaking them up’ has never been a serious proposal.

The EU’s alternatives have in the past not been much more successful; Google’s $8bn of EU fines have done nothing to reduce its power over the market and users’ data.

However, a Digital Services Act (DSA) is now in the pipeline, and will be seen as the follow-up to the EU’s standard-setting GDPR regulation.

It is expected to be preceded by the final report on an investigation into Amazon’s antitrust practices that began in July 2019.

Alternative strategy on Amazon is more likely to be effective

The Amazon report will be an important indicator of the approach to be taken in the DSA, putting Amazon first-in-line for regulation under the EC’s new strategy.

The EC has promised a singular legal focus that will make its reports and their hoped-for legislative results harder to argue with than the fractious arguments posed in the US.

It will scrutinize the ‘dual position’ of tech giants, which for Amazon means being a competitor in a marketplace where it also sets the rules.

It will also encompass the use of third-party sellers’ data, one point which Amazon’s CEO Jeff Bezos was unable to deny during his subcommittee hearing.