“All I’ve heard about have been problems. I haven’t heard of a single benefit,” says Carl Szabo, vice president and general counsel of NetChoice, a trade association representing Facebook, Google, Twitter and other tech companies. Szabo will be at the DOJ workshop next week.
This Orwellian outcome to Hawley’s plan is the primary reason it is opposed by NetChoice, a trade association representing Facebook, Google, and Twitter. “Sen. Hawley’s proposals would place the entirety of FTC authority under the control of a single director, giving that person the sole power to dictate the future of American business,” vice president Carl Szabo said in a statement. (emphasis mine)
“Rather than protecting the agency from regulatory capture, Sen. Hawley’s proposals would make political abuse more likely — right when concerns are growing over politically motivated antitrust actions,” NetChoice Vice President and General Counsel Carl Szabo said in a statement.
— “Having two federal agencies in charge of enforcing antitrust law makes as much sense as having two popes,” Lee told MT in an emailed statement. “This is an issue we’ve had hearings on in the Judiciary Committee and I think Sen. Hawley has identified a productive and constitutionally sound way forward.” (Hawley’s proposal swiftly drew pushback from one industry group, NetChoice, which said it “would make political abuse more likely.”)
The biggest of those loopholes is the simple fact that rental car companies are exempt from paying sales tax when they buy new vehicles. According to a report published this week by NetChoice, that sale tax exemption saved rental car companies more than $3.5 billion last year. In California, where other residents have to pay a 7.25 percent tax on the price of a new car, that tax break saved rental car companies more than $676 million in 2019.
That sweet deal isn’t available to users of Turo or GetAround. Good luck telling your state that the reason you didn’t pay your vehicle sales tax bill is because you plan to rent the car as a side hustle.
“State governments hand out billions to companies like Enterprise and Hertz, providing them an unfair advantage over competitors, like peer-to-peer car-sharing services,” says Steve DelBianco, NetChoice’s president.
The NetChoice report also examines the so-called “vehicle license fees” tacked onto the cost of renting a car through traditional platforms such as Enterprise or Hertz. Consumers probably don’t think about that fee as anything different than a tax—but in reality, it simply provides additional revenue for the rental car platform and does not go to local or state governments.
Carl Szabo, vice president for NetChoice – a trade association for businesses promoting free enterprise on the internet – said he was utterly amazed at the opposition to the bill.
“I feel like my head is about to explode,” he said. “Everyone is saying it’s unnecessary. But you don’t send the senior VP of Live Nation for a bill that’s unnecessary. Clearly they have a lot more planned for Indiana consumers than meets the eye.”
He was referring to Tom Mendenhall of Live Nation – one of the largest events promoters and venue operators in the world – who attended the hearing on the bill. Live Nation owns a number of venues in central Indiana.
Carl Szabo is general counsel of NetChoice, one of tech’s most aggressive lobbyists, whose members include Google, Facebook, Twitter and Yahoo. He spends most of his time beating back two arguments: that tech companies are too big and should be broken up, and that section 230 — the “liability shield” that has fuelled their rise — needs to be scrapped.
Szabo, however, said that this logic was faulty. Section 230, he said, simply codifies another concept, known as “conduit immunity”, which he argued had been established through decades of court cases. If section 230 goes away, Big Tech is prepared to claim that they are protected by conduit immunity instead.
“At the end of the day, section 230 produces the most good with the least harm,” said Szabo, because it empowers companies to police their content — Facebook, for example has 30,000 post moderators — without fear of legal reprisals.
This is shaping up to be a key battleground. Szabo said the industry would “stand in unison” against efforts to touch section 230. Farid, who testified in Congress on Big Tech’s failings last year, said: “Industry lobbyists can say what they want, but there is bipartisan support for reforming 230. Everybody acknowledges that this is absurd.”
According to industry sources, American politicians are considering borrowing from Britain, where a law set to go into effect this year would impose a “duty of care” on platforms, even allowing for civil suits if companies failed to protect users from a list of harms ranging from pornography to cyber-bullying.
The other area of focus for Szabo is the call to break up Big Tech. The giants’ power was on full display last week. Facebook hit record profits and revealed that an astounding 2.9 billion people used its apps every month. Amazon reported its best three months ever. So did Apple. Amazon’s zooming stock price added $13bn to Bezos’s fortune in a day.
For Szabo, the eye-catching figures are distractions from the reality: none of these companies fits the legal definition of a monopoly, which in America means a company that uses its power to harm consumers. Facebook, for example, has less than a quarter of the global advertising market. Google has about a third. Amazon accounts for roughly half of e-commerce transactions but is lapped by Walmart in overall sales. Apple is one of many in a crowded smartphone market, with about 15% of global sales.
“From an analytical perspective, when you look at whether there is a case to be made for antitrust, it fails every time, aside from the declaration of, ‘They’re too big’,” said Szabo. “When you actually look at the facts, there’s no ‘they’ there.”
Steve DelBianco, CEO of NetChoice, said that Warren’s fellow Democratic Party presidential candidates weren’t really concerned about the corporate power of Silicon Valley. Rather, he said, the issues they raised at the October presidential debate were election interference, disinformation, privacy and the censorship of controversial conservative speech.
“None of the concerns they raised have a single thing to do with antitrust,” said DelBianco, whose group was active in opposing the antitrust case against Microsoft in the late 1990s and early 2000s.
Despite this growing distrust of TikTok in the United States, ByteDance has been working to rebuild its public image. Recently, TikTok joined NetChoice, a trade association that has been aggressive in pushing back on critics of tech companies and has begun to enhance its lobbying efforts in the U.S.
Steve DelBianco, president/CEO of NetChoice, warned that antitrust actions could affect innovation, since small companies often build strategies with expectations of being acquired by a major provider, such as the platform companies.
DelBianco also predicted that by 2030, “Government will still be trying to figure out how to regulate artificial intelligence,” which will continue to be a major initiative of all the platform providers.