Big Tech CEOs Testimony Before Congress
Today was the day as I record these words the big tech CEO's are still testifying before Congress. So I'm going to have to do a summary of what I've seen just in the first couple of hours or so and leave some of the juicier question and answer back and forth for tomorrow. I up a note on the format that we've been seeing. Yes. All of the CEOS were testifying remotely. They were using Cisco Webex as the video conferencing tool and it seemed to work fairly well at least right until this very moment as I turned off the stream to go into the booth to record this, they took a ten minute recess because apparently one of the witnesses. was having an issue with their stream or feed, and I'm wondering if it might have been Jeff Bezos because at least thus far were almost an hour and a half into the testimony and he hadn't been asked a single question. Anyway back to the whole idea of testifying remotely if I were going to do one of those rate, my video call backgrounds reports. Bezos look like he was in some sort of executive boardroom, lots of tasteful Chomsky's behind him. Look like he was in a conference room at a high end law firm I couldn't tell what Zuckerberg was sitting in front of it looked like closed vertical blinds almost like I don't know some sort of like a bunker like if you're battening down your house for a Hurricane Tim, Cook was in front of some sort of tasteful plant trough though he was clearly working off an ipad pro. Let's start off with what the Fab four had to say in their opening statements. Amazon's Jeff bezos underscored Amazon's job creation, its investments in social causes and its role in supporting small and medium-sized businesses. And made the case that Hey Amazon is just a tiny competitor in a huge global market quote. The global retail market we compete in is strikingly large and extraordinarily competitive Amazon accounts for less than one percent of the thousand five, trillion dollar global retail market and less than four percent of retail in the US unlike industries that are winner take all there's room in retail for many winners for example. More than eighty retailers in the US. Alone earn over one billion dollars in annual revenue like any retailer we know that the success of our store depends entirely on customer satisfaction with their experience in our store every day Amazon competes against large established players like target Costco Kroger and of course, Walmart a company more than twice Amazon size, and while we have always focused on producing a great customer experience. For retail sales done primarily online sales initiated online are now in even larger Growth Area for other stores Walmart's online sales grew seventy four percent in the first quarter and customers are increasingly flocking disservices invented by other stores. Amazon still can't match at the scale of other large companies like curbside pickup and in store returns and quote alphabets. Soon, Darpa, Chai, said that Google also operates in a highly competitive. Market and that it's free products benefit the average American quote. A competitive digital ad marketplace gives publishers, advertisers, and therefore consumers an enormous amount of choice pichai stated, for example, competition and ads from twitter instagram comcast and others has helped lower online advertising costs by forty percent over the last ten years with these savings pass down to consumers through lower prices in areas like travel and real estate Google faces strong. For search queries for many businesses that are experts in those areas. Today's competitive landscape looks nothing like I. Did five years ago let alone twenty one years ago when Google launched its first product Google search people have more ways to search for information than ever before and quote. Tim Cook of Apple said that the APP store has opened the gate wider for software developers. Also, apple doesn't have dominant market share quote as much as we believe, the iphone provides the best user experience. We know it is far from the only choice available to consumers Cook said after beginning with five hundred APPs today the APP store hosts more than one point seven, million, only sixty of which are apple software. Clearly, if apple is a gatekeeper, what we have done is open the gate wider we want to get every APP we can on the store, not keep them off and quote. And facebook's mark. Zuckerberg said well, but he said a thousand times before that facebook knows it has more work to do on things like fighting misinformation and that you know companies aren't bad simply because they're big. And he took pains to point out that facebook is an American success story quote although people around the world use our products. FACEBOOK is a proudly American company. He said, we believe in Values Democracy Competition Inclusion and free expression that the American economy was built on many other tech companies share these values, but there's no guarantee our values will win out for example China. Is Building its own version of the Internet focused on very different ideas and they are exporting their vision to other countries as Congress and other stakeholders. Consider how antitrust laws support competition in the US. I believe it's important to maintain the core values of openness and fairness that have made America's digital economy, a force for empowerment and opportunity here and around the world and quote. In his opening remarks, the chairman of the Committee David. Sy-. Selena Rhode. Island. Laid out three areas of inquiry that the was scheduled to delve into at least in questioning from the Democratic Congress folk more on that in A. Quitting CNBC, each platform allegedly serves as a quote bottleneck for a key channel of distribution and quote the platforms allegedly used their control over digital infrastructure to Sir Vail other companies, their growth business activity, and whether they might pose a competitive threat and use that information to maintain their own power and third the platforms allegedly abused their control over current technologies to extend their power through tactics like self referencing their own products. Quote. Prior to the cove nineteen pandemic, these corporations already stood out as titans in our economy. Silly said in the wake of Covid nineteen however, they are likely to emerge stronger and more powerful than ever before, and he concluded by saying quote, our founders would not bow before a king nor should we bow before the emperor's of the online economy and quote? But as I say, while this was labelled as an anticompetitive antitrust inquiry, it seems like the Republican Congress folk were primarily interested in probing alleged bias against conservative users. In fact, Jim Jordan. One of the ranking Republican representatives spent most of his opening remarks railing against. which if that continues would basically be exactly what all of the CEOS in the talking head boxes would be hoping for right lots of distraction and no real spotlight on them. In fact, a lot of the most heated questions directed at a company that's not even present. We'll see if that continues but I have to say straight off Chairman Sicily and was very specific targeted sharp questions. He kept interrupting folks when they started to stray into doublespeak and the very nature of the questions from him and others at least so far. This wasn't like previous congressional hearings we've covered where the congress folk didn't seem to even understand the businesses they were investigating, and maybe that was because I don't know if you saw the woman sitting very prominently very obviously behind Mr. Cecil lean. Let me let the Washington Post fill you in on who that was quote as a twenty eight year old law student Lena Con penned a twenty four thousand word article for Yale Law Journal titled Amazon's antitrust. Paradox. The article described how US antitrust law isn't equipped to deal with tech giants such as Amazon. Even as the company has made itself as essential to commerce in the twenty first century in the way that railroads and telephone systems had in the previous century con now works as counsel for the antitrust subcommittee she has worked with Sylvain to develop his case against the tech giants including Amazon and quote. As I said, the questioning is continuing as I speak these words in fact I just heard that they came back from their recess. The whole thing did kick off hour late only getting started at one PM, eastern? So I don't think it'll be done before for five PM at least. So again, I'll put together a summary of all of the juicy exchanges happening now for tomorrow.