- The CEOs of Apple, Amazon, Facebook, and Google’s parent company Alphabet testified before the US House of Representatives’ Antitrust Subcommittee on Wednesday.
- It’s extremely rare for one of the tech giants’ CEOs to testify before Congress, let alone all four. The subcommittee is nearing the end of a year-long investigation into whether the companies have too much control over the market or unfairly edged out competitors.
- The subcommittee said it will use these testimonies to complete its investigation into whether the companies engaged in anticompetitive practices.
- Visit Business Insider’s homepage for more stories.
WASHINGTON – The CEOs of four of the world’s biggest tech companies appeared before Congress on Wednesday to defend their companies’ growing power.
Amazon CEO Jeff Bezos, Apple CEO Tim Cook, Facebook CEO Mark Zuckerberg, and Sundar Pichai of Alphabet, which owns Google and YouTube, testified as part of an ongoing investigation by the House Judiciary’s antitrust subcommittee into whether the tech companies used their control of the market to unfairly edge out competitors.
The hearing had a fittingly dystopian vibe, as more than a dozen masked lawmakers faced down the four tech titans, whose faces were projected onto large television screens affixed to the walls of the hearing room.
One at a time, each member removed their mask to grill Zuckerberg, Pichai, Cook, and Bezos on a host of subjects, from anticompetitive practices to user safety to their purchase of smaller companies in possible attempts to steamroll competition.
As expected, a handful of lawmakers deviated from the subject of antitrust to pepper the CEOs with questions about the role of China and allegations that their platforms were biased against conservatives. The few flareups came from exchanges like these; in one instance, Rep. Jim Jordan, an Ohio Republican, continued to shout over the next questioner, his colleague, Rep. Jamie Raskin, demanded, “put your mask on.”
Congress, which has developed a reputation for technological ineptitude, pulled off the hearing mostly without a hitch. Most of the glitches appeared to come from Bezos’ end; a connectivity issue forced a brief recess, and at one point, the Amazon CEOs microphone remained on mute as he attempted to answer a question.
For the most part, members stuck to their allotted time and the subject at hand, though the hearing still stretched for nearly six hours, after starting an hour late.
The liveblog is now over. You can watch video of the hearing here, and read the recap below. All times noted are EDT on Wednesday, July 29.
The CEOs released their opening remarks the night before the hearing. arguing their companies’ success is patriotic.
All four CEOs published their opening remarks in advance of the hearing, and they provide insight into the broad arguments they planned to deploy before lawmakers.
Zuckerberg defended Facebook’s acquisitions in his prepared remarks, asserting that WhatsApp and Instagram wouldn’t have survived unless they were acquired. Zuckerberg also framed Facebook’s success as crucial to keeping the US competitive with China.
Pichai and Cook take similar tacks in their defences of Apple and Google, respectively – both emphasised that their companies faced competitors in almost every sector and argued that they had created platforms that enable smaller startups to reach a wider audience.
In Bezos’ prepared remarks, he repeatedly called Amazon small beside competitors like Walmart (Amazon controls a dominant majority of online retail, though not total retail) while simultaneously arguing that Amazon’s size is necessary to keep the online economy running because “just like the world needs small companies, it also needs large ones.”
Before the hearing even started, Sen. Bernie Sanders calls to “break up big tech” and President Trump threatens an executive order.
The very, very rich are getting much richer during the pandemic:
⬆️$73 billion: Jeff Bezos
⬆️$45 billion: Elon Musk
⬆️$31 billion: Mark Zuckerberg
⬆️$28 billion: Bill Gates
⬆️$19 billion: L Page
⬆️$19 billion: Sergey Brin
Total: $215 billion
Tax their wealth. Break up Big Tech
— Bernie Sanders (@BernieSanders) July 29, 2020
While Wednesday’s hearing purportedly focused on antitrust, Trump has repeatedly accused tech companies of being biased against himself and other conservatives. He already signed an executive order threatening to penalise Twitter after it fact-checked his tweets.
The hearing kicked off after an hour delay with lawmakers framing the inquiry as nonpartisan
1:10 p.m. – Rep. David Cicilline, a Rhode Island Democrat who chairs the Antitrust Subcommittee, begins the hearing with an opening statement saying the antitrust probe “has been bipartisan from the start.”
Cicilline hammered the tech giants for their dominance, calling them “the emperors of the online economy.” He argued that unlike in other sectors, consumers who use the internet are unable to avoid the four major tech companies.
“Simply put, they have too much power. This power staves off new competition, creativity, and innovation,” Cicilline said. “Their dominance is killing small businesses.”
“When everyday Americans learn how much of their data is being mined, they can’t run away fast enough, but in many cases they don’t have any other options.”
Rep. Jim Sensenbrenner, the ranking Republican on the subcommittee, used his opening statement to highlight Republicans’ concerns that big tech companies have anti-conservative bias.
“Being a big business is not inherently bad,” Sensenbrenner said. “Since the tech investigation began we have heard rumblings from many who were quick to say your successful companies are too large … however … I share the concern that market dominance in the digital space is ripe for abuse, especially when it comes to free speech.”
Last week, Business Insider reported that Sensenbrenner owns nearly $US100,000 in stock in the four companies.
The four CEOs appeared remotely via videoconference. Here’s what the unorthodox setup looked like:
— Jordan Novet (@jordannovet) July 29, 2020
The CEOs called in using Cisco’s WebEx video software, rather than competing software from Google, Zoom, or Microsoft.
Republicans quickly used the event to air grievances about perceived anti-conservative bias in tech
1:26 p.m. – Before any of the four CEOs were given a chance to speak, Ohio Republican Rep. Jim Jordan used his opening statement to list a series of incidents in which conservatives including Trump were “censored” by tech companies.
Jordan took issue with Twitter – which is not one of the companies investigated in today’s hearing – adding a warning label to a Trump tweet that threatened violence against George Floyd protesters, when it did not apply any such warnings to tweets from Iranian leaders decrying the US.
“You can be the largest state sponsored terrorism … but oh, the President says he’s not going to allow some autonomous zone in DC and he gets censored,” Jordan said.
Jordan continued to speak after his allotted time expired. He was cut off by a House official off camera who said, “Put your mask on,” in accordance with House rules that members wear masks when they are not the designated speaker.
In their opening remarks, the four CEOs framed their companies as unlikely success stories and argued that they still face fierce competition
1:45 p.m. – After being sworn in, the four CEOs started their opening statements, all of which acknowledged the size of their companies but asserted that they didn’t have an unfair advantage in the online market. All four opening statements were published in advance of the hearing.
Bezos and Pichai both emphasised their families’ experiences as immigrants to the US, saying it inspired them to help build their companies.
“I didn’t have much access to a computer growing up in India. So you can imagine my amazement when I arrived in the U.S. for graduate school and saw an entire lab of computers I could use whenever I wanted,” Pichai said.
The opening statements also focus on the platforms the tech giants have built, arguing that smaller startups wouldn’t exist without them. The CEOs of Amazon, Apple, and Google asserted that their retail marketplaces and app stores have created entire new economies for small businesses, while Zuckerberg argues that Facebook’s acquisition of smaller companies has been good for competition.
Tim Cook said Apple doesn’t have a dominant market share in any market where it does business — but the full picture is a bit more complicated
1:49 p.m. – Apple CEO Tim Cook said in his prepared testimony that Apple doesn’t have a dominant market share in any market where it does business, not just for iPhone but for all products. But Apple leads the worldwide market for wearables according to the IDC.
– Lisa Eadicicco, senior correspondent
Zuckerberg starts off his Congressional testimonial by describing how every other company is beating Facebook
1:50 p.m. – To make his case that Facebook isn’t too dominant online, Zuckerberg listed companies that are beating Facebook in different arenas, including the other companies present in the hearing.
“The most popular messaging service in the US is iMessage. The fastest-growing app is TikTok. The most popular app for video is YouTube. The fastest-growing ads platform is Amazon. The largest ads platform is Google. And for every dollar spent on advertising in the US, less than 10 cents is spent with us,” Zuckerberg said.
Lawmakers started questioning with guns blazing, setting an aggressive tone for the hearing
2:02 p.m. – Cicilline hammered Pichai about specific instances that the committee described as anticompetitive practices.
“We heard throughout this investigation that google has stolen content to build your own business. These are consistent reports,” Cicilline said.
“Most Americans believe that when they enter a search query that what google shows are the most relevant results. But increasingly Google just shows whatever is most profitable for Google,” Cicilline said.
Pichai responded that Google’s search algorithms do not explicitly prioritise the company but aim to show users the most relevant results.
Lawmakers confronted Zuckerberg about new allegations that he discussed buying Instagram to “neutralise a competitive threat”
2:10 p.m. – Rep. Jerry Nadler, a New York Democrat, made the revelation that Mark Zuckerberg discussed buying Instagram in 2012 emails in the context of neutralising a competitor. In the emails, published by The Verge while the hearing was underway, Zuckerberg asked Facebook CFO David Ebersman his thoughts about purchasing Instagram. Ebersman reportedly questioned whether Zuckerberg was interested in the acquisitions to either neutralise a competitor or improve Facebook.
In his response, Zuckerberg reportedly said it was a combination of both. He then replied to that email 45 minutes later, according to The Verge, to clarify that “I didn’t mean to imply that we’d be buying them to prevent them from competing with us in any way.”
In response ot Nadler’s questions, Zuckerberg denied that he saw the Instagram acquisition as a means to neutralise a competitor.
Cook fended off scrutiny of Apple’s App Store commission fees, arguing that online app stores are “like a street fight for market share”
2:23 p.m. – Rep. Hank Johnson, a Georgia Democrat, pressed Cook regarding app developers’ perennial complaints that Apple imposes commissions of 15%-30% of revenue made through apps listed on its App Store.
“What’s to keep Apple from increasing its commissions to 50%?” Johnson asked.
Cook objected, responding that doing so would drive app developers to flock to other app stores exclusively, like Google’s Android.
“It’s so competitive I would describe it as a street fight for market share,” Cook said.
Bezos, who hadn’t fielded any questions yet, took a break to eat a snack
— cp ???????????????? (@misscp) July 29, 2020
The subcommittee took a short recess to address technical issues with one of the CEO’s connection
2:38 p.m. – Zuckerberg’s feed appeared to be glitching shortly before the recess was called.
Zuckerberg was glitching out earlier. Might need a reboot pic.twitter.com/cdXO6j12wW
— Tom Warren (@tomwarren) July 29, 2020
Bezos said Amazon has a policy against using the data of sellers on its platform, but that he “can’t guarantee that that policy has never been violated”
2:58 p.m. – Rep. Pramila Jayapal, a Washington Democrat, questioned whether Amazon routinely scrapes data from third party sellers on its platform in order to launch its own products or prioritise other products.
Bezos replied that Amazon has a policy against doing so, but implied it was possible some Amazon employees have broken the policy before.
“I can’t guarantee you that that policy has never been violated,” Bezos said.
Amazon’s collection of seller data is a sticking point in the antitrust investigation into the company. A Wall Street Journal investigation found that Amazon used seller data to plan its own in-house products. Amazon also said in 2018 that it fired some employees for handing out seller data in exchange for bribes.
A lawmaker then asked Pichai if Google was unfairly targeting him and sending his campaign emails to spam in Gmail
3:07 p.m. – Rep. Gregory Steube, a Florida Republican, asked Pichai to explain why emails sent by his campaign were no longer landing in his constituents’ Gmail inboxes, questioning whether it was an effort from Google to target Republicans politicians.
Pichai said Gmail was recently reconfigured with a “tabs” layout that separates personal emails from promotional emails, and that campaign emails would qualify as the latter.
An investigation from The Markup recently found that Gmail does frequently send politicians’ emails to spam folders, but that there doesn’t appear to be a partisan split. Rep. Val Demings, a Florida Democrat, said in her questioning after Steube’s that the same thing happened to her campaign emails to constituents.
‘Put your mask on!’: Lawmakers erupt after Rep. Jim Jordan’s outburst
3:20 p.m. – Rep. Jim Jordan accused Google’s “multicultural executives” of wanting to help elect Hillary Clinton in 2016.
Jordan pointed to a leaked email from a Google executive that expressed a desire to drive Latino voter turnout in advance of the 2016 election as well as surprise that some Latino voters supported Trump. Jordan drew the conclusion that a vote drive to boost the Latino vote inherently supported Democrats and accused the company of such. (Google has said that its efforts to drive voter turnout are nonpartisan, and that opinions expressed in the email were an expression of the employee’s personal views, not those of the company.)
Pichai also said that Google’s work regarding the 2020 election is “fully nonpartisan.” After Jordan’s questions, Rep. Mary Gay Scanlon, a Pennsylvania Democrat, took a jab at her colleague.
“I’d like to redirect your attention to antitrust and away from fringe conspiracy theories,” Scanlon said.
Jordan erupted in response, repeating his claims about the leaked email. Multiple members of the committee responded with jeers towards Jordan, telling him to “put on a mask” in accordance with House rules that members wear masks outside of their allotted time.
— Input (@inputmag) July 29, 2020
Bezos faced tough questions about “bullying, fear, and panic” that Amazon third-party sellers experienced
3:35 p.m. – Rep. Lucy McBath, a Georgia Democrat, played an audio recording from a third-party bookseller who uses Amazon’s marketplace and described “bullying, feat, and panic” as mainstays of doing business on Amazon’s platform, arguing that the company isn’t doing enough to protect them from being crushed by bigger businesses that sell on Amazon.
“We followed all the rules that were set by you. Please help us in earning our livelihood. We beg you,” the bookseller said.
Bezos responded with surprise, arguing that he doesn’t think the person’s experience is typical.
“It does not seem like the correct way to treat her … I don’t understand what’s going on in that anecdote,” Bezos said. “I do not think that’s systematically what’s going on.”
McBath pushed back, asserting that similar concerns were voiced by multiple sellers that spoke to the subcommittee.
“I don’t think you understand the point. I’m concerned that this is a pattern of behaviour,” McBath said.
Mark Zuckerberg was grilled over whether Facebook copied and threatened rivals, but the CEO says the social media giant just ‘adapted features’
3:52 p.m. – Rep. Pramila Jayapal questioned Zuckerberg about whether Facebook has acted out a pattern of lifting features from its competitors while angling to buy those companies.
“How many times has Facebook cloned features from its competitors?” Jayapal asked.
She referenced reports that Zuckerberg pressured Instagram founder Kevin Systrom to accept their offer to purchase the company by threatening to copy Instagram features. She also asked about Facebook’s aggressive competition with Snap, which has repeatedly claimed that Facebook intentionally copied its features and tried to thwart its growth.
“These tactics reinforce Facebook’s dominance which you then use in increasingly destructive way,” Jayapal said.
Zuckerberg admitted that Facebook has “certainly adopted features” that resemble other apps but said the company doesn’t aim to intimidate or pressure competitors.
“I respectfully disagree with the premise,” he said.
Bezos: ‘It wouldn’t surprise me if Alexa sometimes does promote our own products.’
4:12 p.m. – When asked by Rep. Jamie Raskin, a Maryland Democrat, if Alexa had been trained to favour Amazon products when users shop by voice, Bezos said it was possible.
“It wouldn’t surprise me if Alexa sometimes does promote our own products,” Bezos said. He also confirmed that if a person asks Alexa to play a song or piece of media, Alexa will default to media hosted on Amazon Prime if the person is a Prime customer.
Documents unearthed during the hearing revealed that Instagram executives were worried Zuckerberg would go into “destroy mode” if they didn’t agree to its buyout offer
4:39 p.m. – Lawmakers published a trove of documents obtained through their investigation into the companies during Wednesday’s briefing.
One was a 2012 chat log between Instagram cofounder Kevin Systrom and former Instagram board member Matt Cohler, a former partner at Benchmark. While the names are redacted in the document, the title of the file uploaded by the House names the two people in the chat and the content of the messages makes it clear who is whom.
In the chat, Cohler asked Systrom his thoughts on a buyout offer from Facebook. Systrom said he was worried that if Instagram rejected Zuckerberg’s offer, Zuckerberg would go into “destroy mode” and block out Instagram.
The chat log shines a light on how founders weigh the decision to sell their company to a massive competitor. It also underscores lawmakers’ assertion that smaller startups operate in fear of Facebook.
When questioned about the exchange, Zuckerberg said he “reject[s] the premise” that Facebook intimidated competitors. Systrom ultimately sold Instagram to Facebook for $US1 billion.
Jeff Bezos crumpled under pressure on whether Amazon will continue to block customer donations to SPLC-designated extremist groups, saying it’s an ‘imperfect system’
5:33 p.m. – Rep. Matt Gaetz, a Florida Republican, needled Bezos about Amazon’s relationship with the Southern Poverty Law Centre, a progressive nonprofit that identifies organisations that promote violence, extremism, or terrorism.
AmazonSmile is the company’s charity arm that allows shoppers to redirect some of the money from Amazon purchases to charities. Amazon uses the SPLC’s list of hate groups to determine which groups are banned from AmazonSmile contributions. Amazon is one of several companies and organisations that rely on the SPLC’s designations.
Gaetz claimed that the SPLC is biased against conservatives because it has labelled traditionalist Catholic groups with anti-LGBTQ agendas as hate groups. In response, Bezos appeared to accept Gaetz’ criticism of SPLC.
“It’s an imperfect system,” Bezos said. “I’d be open to suggestions in terms of other nonprofits.”
At one point, Bezos attempted to answer a question while his speaker was still on mute
There was an awkward pause while lawmakers awaited Bezos’ answer.
“Mr. Bezos, you’re on mute,” Rep. Steube said, before the Amazon CEO unmuted his microphone.
The moment came during a string of questions over whether the’ CEOs believed that China stole American companies’ technologies.
The CEOs of Apple, Google, Facebook and Amazon were just asked if they believe China steals technology from U.S. firms.
Cook: We haven't experienced it.
Pichai: Neither have we.
Zuckerberg: Yes, absolutely.
Bezos: I've read that. pic.twitter.com/vbG2K1Dhq8
— Jack Nicas (@jacknicas) July 29, 2020
Pichai denied having ‘first-hand knowledge’ of China stealing information from Google — but it was one of the main reasons Google pulled out of China
5:52 p.m. – In an exchange with Rep. Gregory Steube, Alphabet CEO Sundar Pichai denied having any “first-hand knowledge” of China stealing information from Google. But that was one of the primary reasons why Google closed up its operations in China a decade ago. At the time, Google cited a hacking attack that targeted its intellectual property and the Gmail accounts of Chinese human rights activists. It’s hard to believe Pichai isn’t familiar with that history, especially since he has been familiar with the company’s efforts to reenter the China market.
– Troy Wolverton, senior correspondent
Update: Shortly after 6 p.m., Pichai corrected his prior statement to add that he was aware of the Chinese cyberattack against Google in 2010.
The tech CEOs weighed in on ‘the cancel culture mob’
6:04 p.m. – Rep. Jim Jordan, Republican of Ohio, asked the four CEOs if they’re concerned about “the cancel culture mob.”
Pichai appeared confused by the question, answering that Google’s platforms have allowed for a greater diversity of voices to be heard before Jordan cut him off.
“You are four individuals who have so much influence, it sure would help if you were out there criticising what the cancel culture mob is doing to this country,” Jordan said.
Zuckerberg, Bezos, and Cook all seemed to agree with Jordan’s premise. Zuckerberg said he was concerned about “illiberalism” in online spaces, and Cook echoed that sentiment. Bezos had even sharper words.
“Social media is a nuance-destruction machine,” Bezos said, in agreement with Jordan
Zuckerberg says ‘we’re not going to set our policies based on advertisers’ when asked about advertiser boycott
6:13 p.m. – Asked by Rep. Pramila Jayapal whether Facebook was concerned about the growing advertiser boycott, Zuckerberg responded that the company cares about the boycott but won’t let advertisers influence their policies.
“We’re not going to set our policies based on advertisers, that would be the wrong thing to do,” Zuckerberg said.
The subcommittee chair, Rep. Cicilline, ended with a call to break up the big tech companies.
6:34 p.m. – House Antitrust Subcommittee chair Rep. David Cicilline closed the hearing after nearly six hours with a call to break up and regulate the tech companies that testified.
“This hearing has made one fact clear to me: These companies as exist today have monopoly power. Some need to be broken up, all need to be regulated and held accountable,” he said.
The subcommittee is expected to publish a report on the findings of its investigation in the coming weeks.
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