Stop The Antitrust Gerrymandering

from the make-stronger-arguments, dept

The social media app TikTok was reported to have passed more than 3 billion total downloads in July and was the most downloaded app in the first half of the year. This growth is impressive as it not only was banned in India but is the first app not owned by Facebook to pass 3 billion downloads. Yet in the recent antitrust cases from the Federal Trade Commission (FTC) and the states attorneys general against Facebook, there is little mention of the popular app.

This omission is reminiscent of politicians gerrymandering or drawing political lines to benefit their parties’ candidates in re-election. Attorneys general and federal agencies have also relied on excluding competitors or narrowly defining markets to make their cases against Google and Facebook.

The FTC led lawsuit against Facebook provides a case in point. The lawsuit accuses Facebook of having a monopoly over “personal networking services.” The FTC argues that products like LinkedIn or Twitter are different from Facebook and shouldn’t be considered as a personal networking service. TikTok with its 3 billion downloads fails to warrant a mention.

Even with these exclusions, the FTC contends that Facebook only controls approximately 60 percent of the market yet omits whatever company or companies control the other 40 percent. Unsurprisingly the judge was unconvinced of the claim that Facebook controlled 60 percent of the market and gave the FTC 30 days to amend the complaint to show their work.

As other cases against Google move through the process, they will likely face the same struggles at convincing judges due to their gerrymandering. The most recent case filed against Google for allegedly holding a monopoly on app stores in the Android mobile operating system is another example.

The lawsuit immediately fails to pass any logical test since Android is not the only, let alone the dominant, mobile platform in the United States. Apple’s iOS has the majority of users in America and is facing its own antitrust lawsuit from Epic games over its supposed app store monopoly. The states try to get around this by claiming the market is specifically "licensable" operating systems, which excludes iOS, but that only highlights how this is gerrymandering the definition to get to a desired outcome.

Even ignoring Apple, the Android system is extremely open allowing users to download a variety of app stores and even allowing for “sideloading” or downloading apps directly from the developers without need of an app store. The “Freedom Phone” which uses the Android operating system and purports to protect users from “big tech” comes preloaded with its own app store for example.

The problem with these narrow definitions is that it asks judges to ignore the world in which we actually live for ones constructed for the purpose of showing targeted tech companies are monopolies.

Other lawsuits contend that Google holds a monopoly over search when Bing and DuckDuckGo are easily accessible to anyone with an internet connection at no cost. Or that Google faces stiff competition from Facebook, Amazon, and a host of other companies to say nothing of more traditional advertisements.

Like political gerrymandering, elected officials filing these cases seem to believe there is political gain for being tough on big tech. But as with poorly drawn political maps, judges are proving more skeptical. Judges play an important role in protecting a fair in neutral system from political pressure. This is true for both elections and antitrust.

Eric Peterson is the Director if the Pelican Institute for Technology and Innovation. He currently lives in New Orleans

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Filed Under: antitrust, ftc, gerrymandering, market definition
Companies: facebook, google


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  • icon
    That One Guy (profile), 30 Jul 2021 @ 3:45pm

    'We pinky-promise that this case is brought in good faith...'

    'If you ignore all the evidence that proves my case wrong it is clearly right!' seems to be the order of the day for these cases, which is not only not a good look it is only going to make it harder to win cases over actual issues in the future as legal action against the companies will be tainted by past PR stunts like this and you just know the companies will exploit that.

    reply to this | link to this | view in chronology ]

  • identicon
    Annonymouse, 30 Jul 2021 @ 4:10pm

    If only

    If only the ones that bring such Bald faced political witch hunts to the courts were punished with something more than a Get Out of My Court.

    May I suggest 6 months or more as a social worker in an ethnic neighborhood that is supposedly served by a big island.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Jul 2021 @ 4:34pm

    Normal for lawyers?

    I mean the cases are clearly table-pounding wastes of government time and money to try to help their careers but is that out of the norm for lawyers? Spurious arguments that may work are unfortunately the norm and any ole bullshit "not technically perjury" expert witness is an established tactic.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Jul 2021 @ 4:58pm

    Exactly! When you consider that both Facebook and Tik Tok have the repeated violations of the 2011 Facebook FTC consent decree, the whole Cambridge Analytica scandal, then you can see that... oh wait, no. Well, I mean they must be similar sized companies, because Facebook's market cap is around $1,016 Billion, which is almost identical to Bytedance's... um, $250 Billion, well... Look, picking of my good friend Facebook is just *unfair* okay?

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Jul 2021 @ 5:46pm

    Oh, the Pelican Center. They're the corporate shill group that hates municipal broadband, despises worker's rights, and Peterson seems to hate net neutrality given the content of this article, which also includes a friendly video chat with enemy of the open Internet Ajit Pai.. And Peterson was responsible for this moronic article that also got posted to Techdirt. Such an amazing organization to let post another piece on Techdirt and give the Center more exposure and attention.

    But I digress. Onto the article.

    The part about TikTok's massive size and the antitrust cases against Facebook is whataboutism.

    The issue with Android/Google is that Google has leveraged its Google Play Services in anti-competitive ways with OEMs. Europe fined them for a ton of cash after finding that it was indeed anti-competitive. I also believe that when Epic filed their suit against Google, they brought up that Google strongarmed OnePlus away from making a deal with Epic to have a sideloaded Fortnite come preloaded on some OnePlus phones.

    The issue with Apple's iOS is that it's a walled garden. Apple's level of control over iOS is bad for developers as well as consumers. Being able to install apps outside of the App Store on an iPhone would be a massive boon. I recall a few weeks back, there was a large spate of malware redirect ads served up on my iPhone. I would've loved to be able to install a version of Firefox that's actually Firefox, instead of a reskinned Safari, and installed uBlock Origin to browse the Internet ad-free and tracker-free.

    Mobile OSes being divided between Apple's Walled Garden and Google's "Technically open, but we'll do everything in our power to scare you and OEMs to make sure you stay entirely within our ecosystem" is a bad situation for both consumers and developers to be in.

    Google also leveraged their services in anti-competitive ways to press the thumbs in the eyes of the competition. Google blocking development of any YouTube app for the Windows Phone by moving the goalposts, including telling them to code it in HTML5 like nobody else was required to do, while simultaneously giving the green light to YouTube apps for the PlayStation Vita and the Nintendo WiiU, both of which had smaller install bases than the Windows Phone at the time.

    There are also issues with how Chromium, which Google is the owner of, is becoming the default browser codebase that websites get developed to work with, and others like Firefox and more are becoming an afterthought. This isn't good for diversity in browsers. Sure, Chromium can be forked and someone can swap to Firefox and a plethora of other browsers to get away from Google's influence, but that doesn't change the fact that Google is the company that's the principle maintainer and developer of the codebase, and has wielded their other services in anti-competitive ways that should get the FTC to keep a close eye on Chromium.

    All in all, this article has the same vibe as when a moronic Republican brings a snowball into the Capitol building to try and prove that climate change is fake. Other apps being popular and having other services to choose from doesn't invalidate ongoing antitrust scrutiny of corporations that continue to engage in sketchy behavior. Between this piece, the piece by Albrecht on Wednesday, and other corporate-think-tank written arguments against antitrust that've been published on TD, it's kinda sus.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 30 Jul 2021 @ 7:50pm

      Re:

      Do you have some kind of survey or study that shows how many Apple users wish they would throw the doors to their app store wide open? I get why developers hate it, but I'm confident many Apple users would actually be upset if they did that. There is a whole lot of garbage in the Google play store that comes along with the freedom and they likely also perceive the Apple store as safer. No clue if someone has actually researched this but I will go look now too.

      reply to this | link to this | view in chronology ]

      • icon
        madasahatter (profile), 31 Jul 2021 @ 9:17am

        Re: Re:

        I agree. I do not think most consumers are concerned about the percentage Apple, et. al. take from the price. Nor are most wanting to sideload an app. Most of the squawking about app stores come from those who want sideloading to be very easy and developers. The first do not realize the app store serves an imperfect source of apps for users. A source much better than searching the 'net for an app. The second are mostly complaining about the haircut they are taking at the store.

        reply to this | link to this | view in chronology ]

      • icon
        NaBUru38 (profile), 31 Jul 2021 @ 11:16am

        Re: Re:

        Many people wouldn't mind selling their soul to the highest bidder, but it should still be illegal.

        reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 1 Aug 2021 @ 10:06pm

      Re:

      I'm sure this has nothing to do with Techdirt's Tech and COVID being funded by tue Charles Koch Foundation.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 30 Jul 2021 @ 7:29pm

    Government: "Well ya but TikTok isn't a real app it's the Chinese government's spy tool."

    People: "Can we please see at least some vague proof of this?"

    Government: "No."

    reply to this | link to this | view in chronology ]

  • icon
    madasahatter (profile), 31 Jul 2021 @ 9:18am

    Differences

    How different are TikTok and Facebook? If they are sufficiently different they may legally not be competitors.

    reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 31 Jul 2021 @ 9:45am

    It all comes down to

    Which corps are making money and which are paying lobbyists to PAY THEM.

    reply to this | link to this | view in chronology ]

  • icon
    Thad (profile), 31 Jul 2021 @ 10:05am

    A company doesn't have to be a monopoly to engage in anticompetitive behavior. You're conflating antitrust with monopoly -- they're related, but they're not the same thing. (Hint: how do you suppose a company becomes a monopoly?)

    I also can't say as I'm impressed by the "gerrymandering" metaphor. "Gerrymandering definitions"? Sounds to me like somebody's gerrymandering the definition of "gerrymandering".

    reply to this | link to this | view in chronology ]

  • icon
    NaBUru38 (profile), 31 Jul 2021 @ 11:13am

    Hello, I share Eric's concerns that politicians are selectively drawing their definitions of markets according to they political motivations.

    I also agree that these so-called monopolies aren't always such. Obvious examples are social networks and search engines, where there are many to choose from.

    However, I disagree that that lack of monopolies means that governments should let these companies do whatever they wish.

    Many of these companies abuse their market power (which should be measured in daily users and revenue) and do anti-competitive practices to keep competitors away.

    • It's impossible to download your profile history from one social network and migrate it to another.
    • Facebook, Google, Amazon, TikTok and other companies sell your most intimate information to the highest bidder.
    • Apple bans companies from selling apps outside their own app store.
    • Not to mention political donations (aka bribes) and megamergers.

    reply to this | link to this | view in chronology ]

    • icon
      Scary Devil Monastery (profile), 2 Aug 2021 @ 1:31am

      Re:

      "...and do anti-competitive practices to keep competitors away."

      Most of which could be handled by sensible consumer protection laws rather than anti-monopoly legislation. But the US is rabidly allergic to consumer protection so that simply isn't happening.

      reply to this | link to this | view in chronology ]

  • identicon
    Glenn, 1 Aug 2021 @ 9:17am

    I wondered what "antitrust gerrymandering" was. Found out it was just "data cherry-picking."

    reply to this | link to this | view in chronology ]


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