New York AG Candidate: Time To Break Up Facebook And Google

New York attorney general candidate Zephyr Teachout says it’s time to “explore breaking up” Facebook and Google under state and federal antitrust laws if she is elected. 

Teachout, a Democrat, told a crowd outside the Manhattan office of the New York Daily News – the day after the paper fired half of its staff, that tech companies are to blame for dominating the advertising space, “drawing revenue from newspapers and publishers,” reports the Washington Post

“As attorney general,” said Teachout, “I would work with my colleagues in other states to launch a major antitrust investigation to look into the ways in which Facebook and Google are wielding and may be abusing their duopoly powers.”

The Attorney General hopeful’s campaign pledge comes amid a national debate about competition and monopoly, as many – including President Trump, have set their sights on tech giants for unfair practices.

President Trump tweeted on Monday that “the Washington Post is nothing more than an expensive (the paper loses a fortune) lobbyist for Amazon. Is it used as protection against antitrust claims which many feel should be brought?”

New York in particular is widely viewed as a champion of consumer protection issues, as previous attorney generals have aggressively pursued litigation against companies accused of misbehaving. 

Elsewhere, Missouri Attorney General Josh Hawley on Wednesday announced an expansion of his office’s antitrust probe into Google. Hawley served a new subpoena as part of his investigation into whether the search giant may have taken “improper steps to enhance its market power.” Hawley cited the European Union’s recent $5 billion fine against Google for bundling its proprietary apps on Android phones in what the E.U. said was an anti-competitive fashion. –WaPo

“If the European commission’s allegations are true, Google’s conduct may have violated both federal and state antitrust laws,” Hawley said in a statement.

Facebook and Google’s domination of the advertising space- an estimated 56.8 percent, represents a “democratic crisis” (her favorite phrase) for those in journalism, said Teachout in a Wednesday interview. 

Teachout also says her plan includes the blocking of new M&A between tech companies that she says stymies innovation and competition, while also promising to use federal laws such as the Clayton Act and the Donnelly Act to go after monopolies. She would even pursue completed acquisitions for targeted “unwinding.”

The cuts at the Daily News appeared to have little to do with the tech platforms directly; instead, the layoffs stemmed from business decisions by the paper’s parent company, Tronc. But Teachout said the “decimation” of local newspapers such as the Daily News reflects a broader economic reality for publishers. –WaPo

“People are making money off of local news,” she said. “But it isn’t the journalists, and it isn’t the publishers. It’s Facebook and Google.”

That said, not everyone agrees with Teachout’s premise, suggesting that newspapers are actually helped by tech companies which distribute their content to large audiences online – while some outlets’ financial troubles can be traced to the proliferation of competing sources of information such as new online publications and blogs. 

“Papers that are struggling are those that can’t compete with a much expanded market or that refuse to enter the digital age,” said Geoffrey Manne, executive director of the Portland-based International Center for Law and Economics, a think tank. “But this idea that a Facebook/Google ‘duopoly’ is to blame is simply wrong. This is pure politics.”

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Author: Tyler Durden