Big Tech CEOs ready defenses for U.S. Congress hearing into their growing power

[July 23, 2020]  By Nandita Bose and Diane Bartz

WASHINGTON (Reuters) - The chief executives of four of the largest U.S. tech companies plan to deflect criticism next week in a Congressional hearing into their use of market power to hurt rivals by saying they themselves face competition and by debunking claims they are so dominant.

The CEOs of Facebook, Amazon.com Inc, Alphabet's Google and Apple, are set to speak before the House Judiciary Committee's antitrust panel on July 27. They will present their testimonies virtually, according to sources familiar with their plans.

The panel is questioning the companies as part of its sweeping probe into whether they actively work to harm and eliminate smaller rivals, while not always making the best choices for their customers.

The high-profile hearing, which will bring together Amazon's Jeff Bezos, Facebook's Mark Zuckerberg, Apple's Tim Cook and Google's Sundar Pichai, will be a key moment in the growing backlash against Big Tech in the United States and is likely to set up a face-off between the executives and skeptical lawmakers from both parties.

Many tech lobbying groups and industry critics say the hearing is unlikely to address core antitrust issues or bring new information to the table, however.

Apple is likely to be quizzed about the way it manages its app store after facing criticisms that it presents hurdles to newcomers. Apple told Reuters it will argue it does not have controlling market share for apps. The iPhone maker views its store as a feature designed to ensure the security and reliability of its phones.

Apple will address issues such as the approval process for the app store - long a sore point with developers who have said their apps are held up without warning - and allegations it does not share key functions such as data about the phone's location.

The other companies will also contend they still face plenty of competition.

A source familiar with Amazon's plans said Jeff Bezos will talk about the options consumers have for online purchases and how the coronavirus pandemic has boosted e-commerce overall - including for large retail rivals such as Walmart.

Facebook Chairman and CEO Mark Zuckerberg testifies at a House Financial Services Committee hearing in Washington, U.S., October 23, 2019. REUTERS/Erin Scott

He will also talk about small sellers on its third-party marketplace platform and "how they have continued to thrive despite competition from Amazon," the source added. Amazon has come under scrutiny on how it uses data from small sellers to benefit its own business.

Bezos will also address allegations the company took advantage of the pandemic by limiting inventory sold by small sellers but will stay away from bringing up contentious issues such as the conversation around breaking up the company, the source said.

Facebook's Zuckerberg will follow a similar tack, another source said. He is expected to argue that the company has strong competitors, including Google and Amazon on the advertising side and Twitter and TikTok in social media.

Zuckerberg is expected to renew Facebook's call for government regulation in areas such as harmful content in social media, election integrity, and privacy - areas where the company has been criticized.

Details of Google's likely arguments were not available. But in recent weeks the firm has published blog posts and a whitepaper asserting that it still faces plenty of competition and that the fees it charges ad buyers and sellers are justified.

Amazon, Facebook and Google declined comment.

"There's not much tech CEOs can do to appease anti-tech critics... this hearing is not about finding truth but creating news stories," said Carl Szabo, vice president and general counsel at industry lobby group NetChoice.

(Reporting by Nandita Bose and Diane Bartz in Washington; Additional reporting by Stephen Nellis and Paresh Dave in San Francisco and David Shepardson in Washington; Editing by Chris Sanders and Rosalba O'Brien)

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