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home : news : national news free February 28, 2020

1/13/2020 10:00:00 AM
Insider Q&A: Antitrust expert looks for strong enforcement
Marcy Gordon
AP Business Writer

WASHINGTON (AP) — Sally Hubbard is an antitrust expert who is director of enforcement strategy at the Open Markets Institute, whose central mission is to call attention to the risks of corporate monopolization. Hubbard previously served as an assistant attorney general in the antitrust bureau of New York state.

With the biggest tech companies under government investigation for alleged anti-competitive conduct, her analysis speaks to an issue of growing urgency.

The interview has been edited for clarity and length.

Q: Far from being ripped off, many consumers feel they’re getting great deals and free services from the likes of Amazon and Google. So what’s the problem for the consumer?

A: Antitrust doctrine has been weakened in the last 30 years. The case law that’s come out has been heavily influenced by what’s called the Chicago School of Economics. It took antitrust law and made it all about corporate efficiency and low prices instead of what it was supposed to be about: Competition.

But if you look at the antitrust laws, they don’t talk about low prices. There’s no mention of the word “prices” in the antitrust laws. You’re paying with your data. It’s not free. And the amount of data that you’re paying, it’s very hard to see. We don’t even know the ways we’re being tracked. The fact that Google, because it’s the search engine, can direct half of the world’s traffic to its own properties —that’s not fair competition.

Q: People might say, all this scrutiny of tech companies is going to squelch innovation. How do you balance innovation with protecting privacy?

A: The industry has been skewed towards innovation at all costs. You need to have some balance between innovation and safety. I’m not saying we should kill innovation with insane amounts of regulation, but there needs to be a better balance.

Q: The House Judiciary Committee, the Justice Department, the Federal Trade Commission are all investigating competition in the tech industry. What outcomes would you like to see?

A: I want antitrust enforcement against conduct that is anti-competitive. When you enforce antitrust laws and you make a level playing field, you get more innovation. In fact, when the government broke up AT&T, they got more innovation.

Breakup can be a remedy in antitrust enforcement, though it’s not a cure-all. I think it would be pretty easy to break up Facebook by just unwinding it. WhatsApp and Instagram were acquisitions. You could just break them up into the component parts as they were before they were acquired.

And legislative changes are needed to fix some of the bad antitrust case law that makes it harder for the enforcers to win cases. Against things like predatory pricing, which is an incredibly effective strategy to drive rivals out of the market. That’s what Walmart did, and that’s what Amazon is now doing.

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