AMERICA Act Proposes to Curtail Big Tech’s Ad Dominance
April 5, 2023
A bipartisan Senate group is supporting a bill aimed at reducing the online advertising dominance of Big Tech platforms like Google, Meta and others. Introduced last week by Mike Lee (R-Utah) and championed by Elizabeth Warren (D-Massachusetts), the AMERICA Act — short for Advertising Middlemen Endangering Rigorous Internet Competition Accountability Act — the bill prohibits companies that “process more than $20 billion in digital ad transactions” from owning multiple parts of the digital ecosystem presenting the advertisements. Proponents say the AMERICA Act could radically reshape the advertising framework that underpins the Internet economy.
“The bill would kneecap Google and Meta, the two biggest players in digital advertising by far, but its provisions seem designed to affect almost every Big Tech company from Apple to Amazon, too,” writes Gizmodo.
“Companies like Google and Facebook have been able to exploit their unprecedented troves of detailed user data to obtain vice grip-like control over digital advertising, amassing power on every side of the market and using it to block competition and take advantage of their customers,” Lee said in a statement.
Gizmodo points out that this means Google-parent Alphabet “is now fighting a legal battle on four different fronts.” An antitrust lawsuit was filed against the tech giant by the Department of Justice in January, while a 2020 DOJ case focusing on search and advertising 2020 is scheduled for trial in September.
Concurrently, multiple states attorneys general have brought antitrust charges against Alphabet over Google Pay fees and as well as for monopolizing digital ads.
“If enacted into law, this bill would most likely require Google and Facebook to divest significant portions of their advertising businesses — business units that account for or facilitate a large portion of their ad revenue,” Lee said in a fact sheet. “Amazon may also have to make divestments, and the bill will impact Apple’s accelerating entry into third-party ads.”
The crux of the proposal is the elimination of a conflict of interest among “players that have an offering on both the buy and sell side of the market,” which allows “the leading platforms in the market to manipulate ad auctions,” DigiDay reports, adding that the AMERICA Act carries the baton of the last Congressional session’s Competition and Transparency in Digital Advertising Act, “with the aim of protecting competition in the $568 billion digital advertising economy, a market dominated by the scions of Silicon Valley.”
The fact that the lawmaking has been resurrected indicates a determination rarely seen in legislators today. “Taking on big tech may be the only thing that truly unites Democratic and Republican lawmakers,” Gizmodo writes, listing Amy Klobuchar (D-Minnesota), Ted Cruz (R-Texas), Richard Blumenthal (D-Connecticut), Marco Rubio (R-Florida), Eric Schmitt (R- Missouri), Josh Hawley (R- Missouri), John Kennedy (R-Louisiana), Lindsey Graham (R-South Carolina) and J.D. Vance (R-Ohio).
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