WASHINGTON – President Biden on Friday will encourage federal agencies to stop the growth of large tech companies through mergers and gain a competitive advantage by leveraging huge consumer data as part of a larger arrangement aimed at spreading corporate consolidation across the economy.
The executive order includes several measures specifically targeting large tech companies like Google, Facebook, Apple and Amazon, said people with knowledge of its contents.
The order will tell federal agencies approving mergers that they should review tech industry practices more closely. A second provision will encourage the Federal Trade Commission to enact rules that restrict the technology giants’ use of consumer data, in response to criticism that companies like Amazon can leverage their knowledge of users to gain the upper hand over competing services and businesses to win.
The order is Mr. Biden’s latest confirmation that the tech giants have gained oversized market power and become gatekeepers for trade, communication and culture. A growing group of lawmakers, academics, and competing corporations say government regulators haven’t controlled the growth of businesses for more than a decade. To counter corporate market power, policymakers would have to aggressively enforce and possibly rewrite antitrust laws to better capture Silicon Valley’s business models.
Mr. Biden has already brought some vocal critics of Big Tech into leadership positions. At the White House, he appointed Tim Wu, a law professor at Columbia University and an outspoken supporter of the liquidation of companies like Facebook, as special advisor on competition issues. He appointed Lina Khan to chair the Federal Trade Commission. Ms. Khan has also called for the liquidation of large tech companies and has worked on an antitrust investigation into the house against Amazon, Apple, Facebook and Google.
Big tech critics also often argue that the economy as a whole has been concentrated at the expense of consumers – including industries like agriculture, medicine, and fashion. And some White House officials hope the order goes back to the presidency of Franklin D. Roosevelt, who highlighted the rise of big business and used government officials against concentration, people said.
But its administration is limited in scope. The Federal Trade Commission and the Federal Communications Commission are independent agencies that enforce existing antitrust and communications laws. These laws have hardly changed since the mass introduction of the Internet.
House MPs have tabled a handful of proposals to strengthen the agencies’ hands, but these bills are likely to meet stiff opposition. White House officials said the new guidelines, expected to be fully released on Friday, don’t necessarily require a Congress to expand the agencies’ capabilities, people familiar with their contents said. In many cases, the supervisory authorities have held back with the enforcement of existing laws and the creation of new rules, it said.
One of the goals of the Executive Order is mergers, where large tech companies buy small businesses that could become tough competitors and wipe out a rival before it gets going. The guidelines encourage agencies to reconsider the guidelines they use to evaluate proposed deals, even if a company purchases a young competitor or a large body of data that could help it gain supremacy.
The ordinance will also ask the FCC to introduce new restrictions on the practices of broadband Internet service providers such as Comcast, AT&T and Verizon. Activists have long said that consumers have too little choice and pay too much money for Internet services.
Mr. Biden will also encourage the FCC to reintroduce so-called net neutrality rules, which prevent ISPs from blocking certain content, slowing down its delivery or making customers pay more to get their content delivered faster. The agency adopted the rules during the Obama administration and then withdrew them under President Donald J. Trump.
While Mr Biden’s order encourages more aggressive antitrust enforcement, it also underscores another fact: he has not yet appointed permanent leaders to multiple positions in government that control competition.
He has not yet nominated anyone to head the Justice Department’s antitrust division. He has yet to appoint a permanent chairman of the FCC, although Jessica Rosenworcel, a Democratic commissioner, has filled the role on an interim basis.