How a New Government Bill Could Change Online Services

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A bill currently making its way through the federal government could have effects on services that companies like Google and Apple offer. If you have a Google Business profile, you might have recently gotten an email from the company about this legislation and its potential effects.

Let’s take a look at this bill to see what it includes and why companies like Google are against it.

The American Innovation and Choice Online Act

The bill in question is called the American Innovation and Choice Online Act. It’s an effort with support from both political parties, designed to restrict tech companies that engage in violations of consumer choice. Massive tech companies like Google, Amazon, and Apple are the target of this bill because of their huge user sizes and incomes.

Under this bill, federal agencies could bring antitrust penalties against these companies for uncompetitive behaviors. These include promoting their own services over others, limiting the availability of competing services, or leading people to their own products using default settings or preinstalled apps.

The summary of the bill also mentions the following:

“The bill also restricts the platform’s use of nonpublic data obtained from or generated on the platform and prohibits the platform from restricting access to platform data generated by the activity of a competing business user.”

This is not the first time we’ve seen such legislation around the world. Google has faced legal issues from the European Union regarding pre-installed Google apps on Android, for example. Due to similar legal decisions around consumer choice, Microsoft offers special versions of Windows in South Korea and most of Europe that don’t bundle in other Microsoft apps like Skype.

The next step of this bill will be a vote in the Senate; whether it will get any further is uncertain.

Google’s Message About the Legislation

Google isn’t happy about this bill. It sent an email to My Business users and published an associated blog post explaining more of its stance. These state that the bill could have “unintended consequences” for small businesses. It gives examples of how business profiles appear in Google search results today, and how they might look if this bill goes into effect.

Google Bill Search Results Example
Image credit: Google

Without business profiles, Google says it will be harder for people who search for a business name to see detailed info like its address and phone number at a glance. It also says that unlinking services like Google Ads and Google Analytics will cause them to be less effective and hurt business productivity.

Other Companies Weigh In

It’s not just Google that would be affected by this bill. Other major tech companies aren’t happy about it either.

Amazon’s response to the legislation says that it will bring “collateral damage” to the small businesses who sell on Amazon, as the company wouldn’t be able to guarantee fast Prime shipping for items sold by third parties.

Apple also weighed in, stating the following:

“After a tumultuous year that witnessed multiple controversies regarding social media, whistle-blower allegations of long-ignored risks to children, and ransomware attacks that hobbled critical infrastructure, it would be ironic if Congress responds by making it much harder to protect the privacy and security of Americans’ personal devices.”

Michael Bloomberg also penned an opinion on the bill. He equates it to forcing an ice cream stand that sells its homemade product to advertise other brands with the same level of prominence.

However, lots of smaller tech companies, including DuckDuckGo, Patreon, Sonos, and Yelp, have supported the bill. In a letter to the committee, they state the following:

“[M]any anticompetitive self-preferencing tactics dominant technology companies use to attain and entrench their gatekeeper status in the market to the detriment of competition, consumers, and innovation . . . have made it difficult for other businesses to compete in the digital marketplace by abusing their gatekeeper status to give themselves and their partners preferential treatment and access on their platforms.”

Pros and Cons of the Act

There’s debate about whether this bill will do more good or bad. Critics of the bill, like Google and Apple, claim that it will make their products less useful because they can’t link services like Google Docs and Google Calendar together.

Google’s blog post about the bill expresses worries that tech companies will have to get approval from government entities before launching new features. There are also security and privacy concerns; companies you choose to share your data with may have to give that data to “unknown companies”. Any search results (whether on Amazon, Google, the App Store, or similar) would have to give low-quality results the same prominence as better resources.

From Apple’s standpoint, this bill could require the company to let iPhone users install apps from sources outside the App Store, loosening Apple’s privacy controls and removing their cut of purchase income. Amazon’s Echo devices could become a lot less useful by losing their integrations with other Amazon services.

Those in favor of this act agree that these gigantic corporations have so much market dominance that they can give themselves preferential treatment to retain their position.

A Difficult Issue

This bill poses a tough question to approach.

On one hand, it’s hard to argue against the fact that companies like Google and Apple are behemoths that face little competition, and a bill like this could allow new companies to thrive. There has been almost no legislation concerning online antitrust since the internet came into popularity.

However, since so many people choose to use these services and rely on them for business, these changes could make popular tools a lot less useful. Even people who would be happy to see those companies knocked down a peg don’t want the services they rely on to suffer in quality. For as dominant as these companies are, lots of people still choose to use their services, even though they aren’t forced to.

These mega-corporations stand to lose a lot if this goes into effect, which explains their stances on the issue. It’s a question of government regulation vs. massive companies doing what it finds best for itself—even if that move is often good for the consumer too. This all means there’s no clear answer.

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