Antitrust: Breaking Up Big Tech • Ashley Gold (Axios)

Technology policy reporter Ashley Gold covers antitrust news for Axios based in Washington, D.C.  She joins Niki in the studio to discuss the U.S. federal government’s crusade against the dominance of Big Tech', and to answer the question: Do voters really want these regulations, or has Congress lost the plot? 

" …we're still in sort of a wait-and-see mode to see whether any of these actions will  result in fundamentally changing how tech operates, but tech is more spooked right now than they have been in a couple of years" -Ashley Gold

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Transcript

Intro:

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Niki: I’m Niki Christoff, and welcome to Tech’ed Up. Today in the studio, I’m talking to reporter Ashley Gold. She’s been on the Beltway beat for years and our conversation is timely as the government’s focus on Big Tech is at a fever pitch. But does the average voter really want the things regulators are focused on, or has Congress lost the plot? We try to figure out what really matters. 

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Transcript

Niki: Today in the studio, we have Ashley Gold. She's a technology reporter for Axios. She's worked at POLITICO, at The Information, when I was a flack for Big Tech. [Ashley: Yeah!] Ashley, thank you for coming on. 

Ashley: We've known each other for so many years now. 

Niki: We have known each other for years and I, I have to say, it's so nice of reporters to come on because we always had this sort of not, there's always tension in our relationship because you were reporting on the people I worked for, but a fair reporter, a good reporter. And what are you covering these days in D.C.? 

Ashley: Well, things are at a fever pitch for people being mad at tech in D.C. It's kind of bubbling over right now. It’s been slowly getting more urgent in the past couple of years, it, y’know, during the Trump administration we saw a lot of anger at Big Tech for misinformation, for crushing their rivals for, in some people's eyes, contributing to, y’know, election challenges in the January 6th insurrection.

And a lot of it has been, sort of, empty threats from legislators, proposing bills that are not going to go anywhere or suggesting cases at the federal agencies here in D.C. that could never stand up in court. But now, we're seeing some action that could actually lead to some results in Congress and at the agencies and across the country with State Attorneys General as well.

So, we're still in sort of a wait-and-see mode to see whether any of these actions will [pause] result in fundamentally changing how tech operates, but tech is more spooked right now than they have been in a couple of years, I would say. 

Niki: I think tech is spooked also. And I think it's for the reasons you said, which it feels like action is, not just coming, just in the last two weeks we've had the head of the Federal Trade Commission did a big interview on CNBC talking about her perspective on regulating technology. We had a bill get out of committee, which, I mean [pause] Congress [Ashley: Usually doesn't happen] No! 

Congress is doing their best over there. [chuckles] I get the impression that the government senses that people are upset about different issues with tech, which you just listed a bunch of them, and they're trying to cowboy up.  And you, and I, I mean, you're a reporter, so you're probably more neutral.  And I feel like they're sort of going down the wrong path. I don't think they're addressing the things Americans are actually upset about.

Ashley: I have to agree with you, in, in some of that. Last week, we saw the Senate Judiciary Committee pass a bill out of committee that was about self-preferencing.

Now, does the average American care about self-preferencing? I don't know that they do. I mean, what is self-preferencing to the average person? You look for something on Google and you see results sponsored by Google first, or you see something from Google Maps first, instead of a different map company. I don't know how much the average American cares about that.

I think that rivals of the big technology companies care about that more. I'm not saying self-preferencing is a good thing to do, but I think when it comes to behavior by the tech giants that people are mad about, it's misinformation, it's their privacy and security and it's the practices that tech companies do to decide what is and isn't allowed on their platforms. Like, it isn’t self-prefencing is top of mind for most folks. [chuckles]

Niki: Yeah! Okay. So, first of all, so, I don't even think most people know what the heck- they never even heard the term self-preferencing for tech. 

Ashley: Right! People’s eyes are going to glaze over if they hear people talking about self-preferencing-

Niki: [interrupts] They're totally bored! And, also, if you do pass a bill and that means that when I buy an iPhone it doesn't come pre-installed with FaceTime or iMessage, [Ashley: Yeah] I don't want that. 

Ashley: I can't see that being something people want. I'm actually a little bit surprised that this is the bill that is moving the most quickly. I, that's not what I would've expected, like, a couple months back. 

Niki: I also think consumers are not stupid. I know how to find Spotify [Ashley: mm-hmm] and put it on my phone. I don't, I don't use Amazon Music and I really don't feel like I have to use Amazon Music.

Ashley: Right. I mean, I've been using Spotify Premium for years, I've- Apple Music has been on my phone,  I rarely even open it. And, like, that's the choice I made, y’know? [chuckles] 

Niki: Right. You feel that you have a choice. [Ashley: Yeah] I think that the American consumer and I have not done, by the way, a statistically significant survey of Americans.

[both laugh]

Ashley: Oh, you haven't?

Niki: Nope, haven’t done it. But my hunch is that having these companies put Google Maps at the top of results, like, people know that they have a choice to use Bing. I mean, nobody does, but they could. They could do it. I tried to use Duck Duck Go for a while when I was feeling really stressed about my data being collected. [Ashley: mm-hmm] And, it just, the experience is not as good because it doesn't have any cookies, so it doesn't know what I want. [chuckles]

Ashley: Yeah. And, I'm not saying there isn't a lot of room for more companies and more innovation and better companies that are an alternative to the giants. Like, I'm all about more companies popping up. And, I can't tell you whether in the eyes of our current antitrust law, self-preferencing is definitely legal or whatever, but as far as what I can tell people actually care about, I don't think this is it. 

Niki: I don't think they care about it. I think what people do care about is [with emphasis] data. [Ashley: mm-hmm] So, I had an experience last weekend that, to me, really taps into whatever this vein of frustration is. So, I went to, I went to, a hockey game at Capital One Arena, which for anyone who's in D.C., you can no longer bring any bag, no purse, none [Ashley: Whoo!] Which you find out when you get there. And then, I had to go to this thing called Binbox, which is like a pop-up locker thing. I've never heard of this company. I had to scan a QR code, which the FBI this week told us that QR codes can sometimes have malicious or phishing software. [Ashley: [sarcastically] Ah. Great] Great, right?!  Just read this in the paper, then had to scan a QR code. [Ashley: Yeah] I scrolled through three pages of terms and conditions, [Ashley: Right] which I signed away-

Ashley: [interrupts] You’re not going to read it. You’re at a hockey game, you wanna go sit down. 

Niki: You wanna sit down and make the game. And then, I had to put in my credit card information and enabled my Bluetooth to put my bag in a locker. And that is what Americans are mad about. 

Ashley: Yeah. It's because there's like, there's no permission. It's, like, everyone is, like, using technology for things like putting your bag away and putting your phone away and, like, that's great ‘cause, like, it's convenient and it's a better, y’know, in some people's eyes, a better way to do things, but it's, like, there's no choice in the matter anymore.

Niki: It's not consent, [Ashley: Yeah] it's coercion. 

Ashley: Mm-hmm. Yeah. And I think people are mad that [pause] their relatives and people they know get radicalized by platforms. I mean, families have been torn apart.  As far as things that have actually had a real human impact on people, misinformation is, is, y’know, what we can really see, like, in real life happening.

Niki: And so, if we go to something you've covered for years, which is antitrust and competition [Ashley: mm-hmm] and breaking up these companies. I think you can't talk about that without talking about Facebook. [Ashley: mm-hmm] And part of that is actually another reporter, a New York Times reporter- I said, “I don't have Facebook.” And she said, “Well, you also don't have kids, but if you have kids in school, you have to be on Facebook.”  That's how they can, the schools, communicate with you. That's how the parent groups communicate. You don't really have a choice. [Ashley: Right]  And so, people feel like, and do in some ways, they're captive to a company.  

Ashley:  Right! And I totally get that. I'm a new mom, and my daycare posts updates of the kids on a private Facebook group. I'm in local Facebook groups, uh, for parents of young kids in my neighborhood. And I get a lot of valuable information out of them that I would miss if I wasn't on it. So, I don't feel like I have a choice. 

Niki: Right. You don't feel that way.  [Ashley: mm-hmm] Okay. So let's talk Facebook as maybe one example. Although there are a lot of examples with what the government's looking at. So the Federal Trade Commission, what are they doing? How has that maybe changed since the Trump era? 

Ashley: Under the Trump administration, toward the end, the agency filed a lawsuit alleging that Facebook acquired Instagram and WhatsApp in a way that was meant to squash their competition so they could get out ahead and buy the rivals before they could surpass them. And that this was anti-competitive and that, in hindsight, the WhatsApp and Instagram acquisitions shouldn't have happened. Mind you, the Federal Trade Commission approved these acquisitions at the time they happened. So, this is the FTC going back and saying, “We actually want another shot at this.” And, y’know, people who criticize this action by the FTC say,  “You had your chance. You decided at the time that it was fine. You wouldn't have known at the time what a success Instagram or WhatsApp would have been. And you can't definitively say that would have happened without Facebook's resources.”

So, that's that argument. So, that original lawsuit, filed under the Trump administration, was rejected by- but, Lina Khan, who's the head of the Federal Trade Commission, who is very sort of notoriously wary of Big Tech, she and her staff refiled that lawsuit. They boosted it up. They made it a lot stronger in, in, the court's eyes and now it is allowed to proceed. So, we have to see what happens there. 

Niki: So, Lina Khan is now the chair of the Federal Trade Commission. She's relatively new. She did her first video interview with CNBC last week. [Ashley: mm-hmm]  Have you been able to talk to her?

Ashley:  I have not been able to talk to her. I have definitely tried. And I'm well aware she's done some national publication interviews, the New Yorker, the New York Times, CNBC. I'm, I consider myself, like, a Beltway D.C. reporter, and I have not been able to snag an interview. No, I really want to, though! [chuckles]

Niki: Yeah. Lina Khan should come- well, she's now not going to like what I'm about to say- [Ashley: chuckles] but I watched that CNBC interview and one of my takeaways was [pause] I only watched the first, I mean, it was long, I watched the first 20 minutes.  [Ashley: mm-hmm] I didn't hear the word consumers come up in those first 20 minutes. [Ashley: Yeah] It was about competitors. 

Ashley: Her argument generally has been that because Big Tech is constantly cutting down their rivals, acquiring them, copying them, that that has a, sort of, trickle-down effect on consumers, where they have fewer choices, they have worse experiences online because there are fewer places to go and that, y’know, people aren't competing on privacy and these, these, other things consumers would care about. But at the end of the day, all these products are free. So, that makes the argument, under current antitrust precedent, kinda tough, which is usually based on price. That's not to say it couldn't change in the future, but yeah, I think the average person watching that interview might walk away, y’know, a little confused as to why this is something they should be concerned about.

Niki: I agree. And I actually want to take- so Activision. So for people who don't know, Activision, which makes a bunch of games, including Call of Duty and a bunch of other really popular games, is in a death spiral [chuckle] press-wise, based on bad practices and culture issues at the company. And Microsoft has just announced that they are going to acquire them. And I was thinking about this. This is going to get a lot of scrutiny [Ashley: mm-hmm] by the federal government because it's, it's, Microsoft.  Big company buying out a competitor in some ways, right? A gaming company. But I see it as a lifeline for a company that is not doing well for those engineers and for people who want to, I guess, shoot people in the metaverse, [both laugh] playing Call of Duty. If they can go, if they can get into the resources of a, sort of, better run company, that might end up being a better outcome for consumers, and for engineers.

Ashley: Yeah. So, consolidation in the gaming industry. I did not realize this till last week, till my very smart colleagues that cover gaming told me, but it's running rampant. Like, a lot of gaming companies are being bought up or combined. So apparently, this is a trend in gaming as well. As far as Microsoft goes, if you've been looking at tech the past couple of years, Microsoft has, sort of, evaded all of these conversations. They obviously had their big antitrust suit, y’know, a number of years ago, and they were under a lot of scrutiny then, but since then, they've kind of been scanned by in D.C. and, y’know, Google would say, “Well, they've actually been cheering for us to be taken down by regulators. And, y’know, Microsoft is taking pleasure in seeing its Big Tech rivals be taken down.”  

And, I can't say I disagree with that. Y’know, Brad Smith has made his rounds in Washington talking to lawmakers. He was just here last week, talking to the Hill about the merger with Activision, trying to, y’know, tell them everything was going to be fine. It wasn't bad for competition. And nobody seemed really that phased by Microsoft's announcement last week. Which just tells me no one really cares about Microsoft right now. They only care about the Big Four. 

Niki: Well, maybe this also goes to the fact that Microsoft is largely an enterprise company. So people are paying for their products [Ashley: mm-hmm] in a way that they're not with these consumer companies that are, I mean, I know that they are also consumer-facing, but a lot of people are paying for their Microsoft Teams [Ashley: mm-hmm]  and their Microsoft accounts [Ashley: mm-hmm, mm-hmm] in a way that Google is quote-unquote free. But then that brings- you are giving something up to use those free products. [Ashley: Right] 

So, one of the things about Microsoft also is there's a world in which, if they decide that certain popular games- I looked this up because I was like, how many people are playing Call of Duty? It's 110 million people a month. [Ashley: Wow!]  Actively. It's huge. [Ashley: That's a lot]  If Microsoft suddenly says, if we go back to self-preferencing, “It's not going to be on a Sony PlayStation, it has to be only on XBox.” That to me seems like a competitive issue [Ashley: Yes] because then people have to go buy something to use their game.

Ashley: Yes. So, as far as self-preferencing goes, when it comes to devices, I think that's when people will get mad. We've seen issues with Roku and other device makers that have to do with TV where self-preferencing has been an issue. 

Niki: I think you're right. I think devices might be the bigger place where the average consumer feels stressed about it. [Ashley: mm-hmm, mm-hmm] Okay. So, you mentioned that Brad Smith, who's the president at Microsoft, was here talking to lawmakers. You wrote a story last week that used a word that I love, jawboning. [Ashley: Jawboning!]  Jawboning! You've got Tim Cook and Sundar Pichai from Google coming and calling senators directly.  [Ashley: Yeah] So, I think you're right. What is happening with the tech companies? You don't see that very often.

Ashley: Yeah. So, I've been covering tech for, I don't know, five, six years. And normally, they let their lobbyists do the work. They let their trades do the work. They let the people that they pay to do work for them speak for them. It's only when tech companies are truly spooked that something could actually pass and become law that they bring out the big guns, aka the CEOs.

So the fact that we have CEOs directly calling senators, like, essentially begging them not to sign on to a bill. That's big. Like, that means they, sort of, know the tide is turning and, like, they have to make personal appeals to these people. I reported on a number of meetings that happened late last year, with a number of tech CEOs doing Hill meetings. Y’know, there were phone calls leading up to the Senate Judiciary Committee, passing that bill out of committee last week. And, y’know, if you're, if you're thinking that Congress isn't going to do anything, you're not putting a CEO on the phone with a member of Congress. You're not adding that to their schedule. [chuckles]

Niki: Yeah, I think that's right. I think they think something's happening, and I'm not sure the right thing is happening, but something's happening. The gears of government are turning.

Ashley: Mm-hmm. There is movement.  There's movement and y’know, like any bill it's still got a long way to go, but the fact that it's made it out of committee is impressive for Washington. [chuckles]

Niki: It's impressive for Washington. [Ashley: Yeah] So, as a reporter, let's end on this. How is your life changing right now versus maybe when you started covering these beats? Including, like, your sources, how the companies talk about each other.

Ashley: Yeah. So, I think one thing that is really illustrative of how things have changed is that a once very important organization called the Internet Association has dissolved. They were once the biggest trade organization in Washington for tech companies representing their interests, lobbying for them, doing huge dinners, honoring Ivanka Trump and Nancy Pelosi at the same dinner, lots of glamour and D.C. intrigue around them.  But now they are dissolved because they weren't working on competition issues and competition is now everything. So, that's really changed the conversation. And now everything is just more real. When I first started covering it, it was always sort of like these threats on the side, like, oh, there could be some worries about antitrust. You had your typical rivals of Big Tech, like Yelp, sort of nipping at the heels, like, agitating for antitrust action, but nothing would ever really. It seemed like a pipe dream. And then, I think, the 2016 election and the 2020 election and the January 6th insurrection made things really, really, real as far as the anger against tech. And it just kept sort of trickling up further to higher levels of government and now, it's, it really can't be ignored.

So, I would say covering tech has gotten more exciting, gotten more, y’know, you get higher level people on the phone now, because these concerns are going all the way up to the CEO level. And we get a little more in the regular mainstream conversation whereas before, y’know, tech policy was still a little nerdy,  still a little in the weeds, and sort of struggled to be part of the mainstream news cycle. [chuckles] But it, it, it, it's a little more exciting.

Niki: Yeah, it’s broken through.  [Ashley: chuckles] So, I will say, to make this clear, none of the companies we've talked about today, Microsoft, Amazon, Google, are any of my clients. [Ashley: mm-hmm] If I did have advice for those companies, I'd focus on- it's those data hostage situations, people hate. [Ashley: mm-hmm] But also, no one wants more hassle in their life. I don't want to have to go download FaceTime when I buy an iPhone. [Ashley: chuckles] And I think, focusing on those messages are kind of winners with Americans, but, absolutely, there is, there's action, there are things happening. You just don't see this level of engagement with these high powered people if they don't think something's moving. So, stay tuned, [Ashley: Stay tuned!] Follow Ashley Gold on Twitter. 

Ashley: [interrupts, chuckling] Ashley R Gold. Thank you very much. 

Niki: Ashley R Gold on Twitter.  Follow her!  [Ashley: chuckles] She's going to be talking about all of these issues and getting the scoop and maybe Lina Khan will come talk to you. 

Ashley: Yeah! Let's do it. 

Niki: Do it! Thanks for coming on the show.

Ashley: Thank you.

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Outro: 

Niki: Over the next few weeks, we have guests coming on the show to talk about self-driving trucks, D.C. start-up culture, and outer space. Be sure to follow Tech’ed Up wherever you get your podcasts.