US politicians bicker over Microsoft

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Even as Microsoft hovering around a valuation of $ 2 trillion, it could avoid being included in an American antitrust bill aimed at large technology companies.

The question of whether Microsoft would be able to circumvent measures taken by the House Judiciary Committee on Wednesday has been raised by lawmakers, including Democrat Pramila Jayapal, the author of one of the bills. Republican Jim Jordan and other GOP lawmakers say they want to make sure the software giant doesn’t get special treatment.

Washington State Representative Jayapal said if Microsoft clearly exceeds the $ 600 billion market capitalization threshold predicted in four of the six bills submitted to the judicial panel, another test could allow the Redmond-based company in Washington State to get out of the woods.

“There is another category which is: are they an essential business partner? Which means they are in control of someone’s ability to enter the market, ”Jayapal said in a brief interview during a one-day break from the hearing. “This they may not be eligible for.”

A company must meet all the criteria of the four technology-focused bills to be considered in the scope.

Republican Rep. Thomas Massie of Kentucky challenged his fellow committee members to explain why Microsoft would not fall for the measures.

“Mysteriously avoided”

“I’m trying to understand why one of the biggest offenders, Big Tech, has mysteriously avoided scrutiny by this committee and this wide array of bills that seek to drastically rewrite our antitrust law,” said Massie waving a bill that he said was shared with Microsoft before it went public. “I’m talking about Microsoft.”

Democrat David Cicilline of Rhode Island, chairman of the antitrust subcommittee that drafted the bills, denied at the hearing that a company had benefited from an exception. He said the bill in question is based on previous legislation presented to the Senate, so it would not have been difficult to find a draft.

“There are no exemptions in these bills,” Cicillin said. “No company is period exempt.”

A final decision on which companies would be covered by the bills will be made by enforcement agencies, Cicillin said. “Each of these bills is broadly applicable to businesses that meet the definition of a covered platform,” Cicillin said, without saying whether Microsoft would be one of them.

The bills submitted to the Judiciary Committee on Wednesday stem from last year’s investigation into anti-competitive practices by Facebook, Apple, Amazon.com and Google. Microsoft, which offers products such as Windows, LinkedIn, Office and Teams, was not the target of this investigation.

All six bills are likely to be approved by the judiciary committee, but it’s unclear whether they have enough backing to get through the house. Their fate is even more uncertain in the Senate, where legislation needs at least 10 Republicans to pass, making it difficult for them to become law as it is written.

One in four changes to the amendments that will be proposed Wednesday by the President of the Bench Jerrold Nadler, a Democrat from New York, would adjust the definition of “online platform” for the four technology-focused bills.

The current versions of the four bills refer to an “operating system” to define the services that would fall within the scope of the bill. Nadler’s amendments would change this to a “mobile operating system”.

The bill that Massie introduced during the hearing did not mention operating systems in this definition at all. A Microsoft spokesperson said the company had not requested the change.

Asked during a break in the hearing as to whether Microsoft – which has built its success with its Windows operating system for computers – would be within the scope of the bills, Nadler replied that it ” would think so ”.

Special treatment

Jordan of Ohio, the top Republican on the Judiciary Committee, took note of what he saw as Microsoft’s special treatment in bipartisan bills. He sent a scathing letter to Microsoft Chairman Brad Smith on Monday, claiming that “Democrats have excluded Microsoft from the antitrust review,” and demanded a clear answer as to whether the company thinks it will fall under the EU’s proposals. House.

“This is what we have here. Bills supposed to target Big Tech, being drafted by Big Tech, ”Jordan said at Wednesday’s hearing.

Last week Smith said in an interview with Bloomberg TV that “there are aspects of the legislation that was introduced at home last week that absolutely applies to Microsoft and many other companies.” This, however, could have referred to the two bills before the committee that offer modest measures to support antitrust authorities and are not focused on the tech industry.

Microsoft President Brad Smith

Smith went on to say that he sees US antitrust action focusing on services that are not Microsoft’s core business.

“I think in a lot of ways the focus is on the technology platforms that serve as gatekeepers,” Smith said. “In other words, they not only serve as a platform like an operating system, but people have to use them to sell their business, whether it’s a product on Amazon or an app. , for example, in the Apple App Store or through a service like Google Search.

Smith has cultivated strong relationships with lawmakers, including top Democrats and Republicans on the antitrust subcommittee. He testified in March in support of the Cicillin Bill to help newspapers negotiate with online platforms.

He was also in the same class at Princeton University as Colorado Republican Ken Buck, who was instrumental in drafting the bills and last year’s investigation into Facebook, Apple, Amazon. and Google.

One of the bills is Cicillin’s proposal to ban any practice that “benefits the Covered Platform Operator’s own products, services or lines of business over those of another professional user” . This could limit the way Apple presents its own music and messaging products on iPhones, as competitors including Spotify and Facebook’s WhatsApp depend on mobile phones to reach consumers.

Assignment

Jayapal’s bill, whose district includes the outskirts of Seattle, could force entire lines of business to be divested. This could be devastating for Amazon, which is based in Seattle.

The other two measures, including one sponsored by Buck, would limit acquisitions by the covered platforms and make it easier for users to move their data, such as contacts and photos, from one service to another. – Reported by Anna Edgerton, Billy House and Rebecca Kern, (c) 2021 Bloomberg LP

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