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  1. BOULDER, Colo (Reuters) - In April 2019, Tile.com, which helps users find lost or misplaced items, suddenly found itself competing with Apple Inc, after years of enjoying a mutually beneficial relationship with the iPhone maker. Apple carried Tile on its app store and sold its products at its stores since 2015. It even showcased Tile’s technology at its biggest annual event in 2018 and the startup sent an engineer to Apple’s headquarters to develop a feature with the company’s voice assistant Siri. Early the following year, Tile’s executives read news reports of Apple launching a hardware product along with a service that resembled what Tile sold. By June, Apple had stopped selling Tile’s products in stores and has since hired away one of its engineers. “After thoughtful consideration and months of bringing our concerns to Apple through regular ... channels, Tile has made the decision to continue raising concerns over Apple’s anti-competitive practices,” Tile general counsel Kirsten Daru told Reuters in an interview. The startup will be one of four companies testifying at the latest hearing of the House Judiciary Committee’s antitrust subcommittee in Colorado on Friday, urging Congress to look at how these companies use their considerable clout in the online market to hurt rivals. Similar investigations are underway at the Justice Department, the Federal Trade Commission and a bipartisan collection of attorneys general from dozens of states. An Apple spokesman said the company has not built a business model around knowing a customer’s location or the location of their device, that users have control of such data and they can choose which location services they want enabled or disabled. In September, House lawmakers asked more than 80 companies for information about how their businesses may have been harmed by any anti-competitive behavior from Amazon.com Inc, Apple, Facebook and Alphabet’s Google. In October, Committee Chairman David Cicilline said he expects to have a final report on its probe by the “first part” of 2019. Another company testifying on Friday is Basecamp, which sells an online project management tool, and has raised concerns about Google’s advertising and search practices. Google makes up more than 40% of Basecamp’s traffic. Google allows competitors to purchase ads on Basecamp’s trademark, and then blocks consumers from reaching its site, Co-Founder David Heinemeier Hansson told Reuters in an interview. The company has started multiple trademark infringement investigations through Google’s internal process, but it is “onerous and slow,” he said. “Google’s monopoly on internet search must be broken up for the sake of a fair marketplace,” Hansson said. Basecamp is now forced to run a more than $70,000 annual advertising campaign to defend its trademark on Google, he said. Google spokesman Jose Castaneda said for trademarked terms like names of a business, the company’s policy balances the interest of both users and advertisers. Google allows competitors to bid on trademarked terms because that offers users more choice when they are searching, but if a trademark owner files a complaint, Google blocks competitors from using their actual name in the text of the advertisement, Castaneda said. Source
  2. The chair of the Federal Trade Commission, Chairman Joe Simons, acknowledged in an interview on Tuesday that perhaps maybe, just maybe, one outcome of an FTC task force inquiry into whether tech giants violated anticompetition laws could be forcing them to break up into smaller companies, according to reports in Reuters and Bloomberg. The likes of Facebook probably aren’t quaking in their bootsies yet. Simons—who perhaps has his hands tied by the ongoing status of his agency’s broad review of the tech sector, but whose agency was accused of coddling Facebook in a recent privacy settlement—more or less merely acknowledged that it was technically within his power to pursue corporate breakups. “If you have to, you do it,” Simons told Bloomberg. “It’s not ideal because it’s very messy. But if you have to you have to.” As Bloomberg noted, the FTC task force has seemed particularly interested in whether Facebook secured its current form as a globe-spanning behemoth by buying up subsidiaries like Instagram and WhatsApp for the sole purpose of eliminating competition. The Department of Justice has launched its own antitrust investigation of the tech sector that appears to have overlap with the FTC one, though Simons offered few details about how the agencies were coordinating. “It’s possible for sure that we could be investigating the same company at the same time but just for different conduct,” Simons told Bloomberg. However, he did reiterate to Bloomberg that Facebook’s 2012 acquisition of Instagram is a particularly open question to the FTC as of now: Simons didn’t confirm details of the Facebook investigation beyond what the company disclosed in July, when it said that the FTC had initiated a broad probe into several business lines — social media, digital advertising and mobile applications. Any inquiry into its past acquisitions would focus on what would have happened to those companies if they hadn’t been bought by Facebook, Simons said. “There’s a question about what caused Instagram to be as successful as it is,” Simons said. “Was it the fact that the seed was already there and it was going to be germinated no matter what or was the seed germinated because Facebook acquired it?” The consolidation of the tech sector in recent years and growing hostility to companies like Amazon, Apple, Facebook, and Google in D.C. certainly seems to have put the issues of scale and competition in the spotlight, and both leading Democratic candidates for the presidency such as Elizabeth Warren and Donald Trump’s administration have urged regulators to step in. (In the case of Trump, the anger clearly has more to do with conspiratorial and baseless accusations that tech companies are secretly backing Democrats than it does... any other coherent motive.) But there’s reason to be skeptical whether this is all just talk or the FTC and DOJ investigations will actually result in breakups anytime soon. As the Verge noted, the growing backlash to tech consolidation follows a long time period in which competition and antitrust watchdogs did basically nothing to stop it—and the pendulum is only slowly swinging back in the other direction. In June, New Street Research analyst Blair Levin told the Information that “any concrete action and coherent thinking on these things” is likely to take at least a year and a half to materialize, meaning the next presidential administration. Source
  3. SAN FRANCISCO (Reuters) - Shareholder activists want Google parent Alphabet Inc to break itself up before regulators force the world’s biggest internet ad seller to split into different pieces. SumOfUs, a U.S.-based group that aims to curb the growing power of corporations, is set to make that proposal at Alphabet’s annual shareholder meeting on Wednesday at an auditorium at the company’s offices in Sunnyvale, California. “Officials in the US & EU continue to be concerned about Alphabet’s market power in view of restrictions on monopolies,” the proposal reads. “We believe that shareholders could receive greater value from a voluntary strategic reduction in the size of the company than from asset sales compelled by regulators.” The proposal has no realistic chance of success as Alphabet’s top two executives, Larry Page and Sergey Brin, hold 51.3 percent of shareholder votes. Nevertheless, it shows a growing focus on the prospect of antitrust action against Alphabet and other big technology firms such as Facebook Inc and Amazon.com Inc as they face a political and public backlash over privacy issues and the power they now wield over the world’s information. U.S. President Donald Trump has been a frequent critic of Google, claiming without evidence that its search engine unfairly produces results unfavorable to him. He has suggested that U.S. regulators should follow Europe’s lead and look closely at tech companies’ monopolies, but has not suggested any specific remedy. The U.S. Department of Justice and Federal Trade Commission are gearing up to investigate whether Google, Amazon, Apple and Facebook misuse their massive market power, sources told Reuters earlier this month. The breakup proposal is one of a record of 13 on the ballot at Alphabet’s Wednesday meeting. A group of Google employees is backing five of the proposals, which it helped craft, but not the proposal to split the company. Tibetan and Uighur ethnic group leaders concerned about Google’s work in China are among speakers expected to speak at demonstrations outside the auditorium before the meeting. Community activists pressing Google to address housing shortages in Silicon Valley also planned to rally. Alphabet said in shareholder materials its existing policies address issues raised in the proposals and declined to comment further. Although none of the proposals is likely to pass, Google may respond to issues raised. The company stopped working on a censored Chinese search engine and banned use of its artificial intelligence tools for weaponry after petitions from employees and outside activists. “We started as a voice in the wilderness on some of these issues, but conversations have come more to the fore,” SumOfUs campaign manager Sondhya Gupta said. Source
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