There are signs a Big Tech backlash could have sweeping ramifications in U.S., Europe, Australia and elsewhere, rewriting the rules for how major technology companies deal with everything from startups to artificial intelligence. Foes of the tech titans may even be leveraging the mood of general hostility toward antitrust tactics exhibited by lawmakers around the globe by seizing the moment to press for changes in the regulation of transatlantic data flows, digital advertising, and self-dealing in addition to new rules circumscribing facial recognition and use of consumer data. Silicon Valley is said to be taking the threat seriously.

Also under consideration are changes that may “delay major product changes or force ongoing oversight of activities,” writes The Wall Street Journal, noting that so far, such saber rattling has had little effect on Big Tech’s bottom line or valuations.

“The market value of five of the world’s largest tech companies is $9.31 trillion, up close to fourfold from five years ago, nearly double the growth for the S&P 500 index in that time. But that could be changing,” adds WSJ, explaining global regulators “are advancing dozens of investigations related to competition and privacy that could lead to more than just speeding tickets for tech giants.”

The Washington Post writes that a new organization, the Tech Oversight Project (TOP), launched this week to try using the same “campaign-style” tactics employed by lobbyists for Big Tech, aimed at laws “that would place new limits on how they wield power over their rivals.” TOP is funded largely by eBay founder Pierre Omidyar’s philanthropy arm and the advocacy division of the Economic Security Project, a nonprofit led by Facebook co-founder Chris Hughes.

“The project sees itself as a direct response to Big Tech-funded groups such as NetChoice and the Connected Commerce Council, which have been flooding social media feeds and email newsletters with ads defending the industry against regulation,” WaPo says.

Those taking on the Goliaths are buoyed by developments like the UK’s Competition and Markets Authority in November order for Facebook to sell the animation firm Giphy because the acquisition limits competition by platforms and advertisers in that country. Facebook is appealing the decision.

“There’s definitely a sense of there being a new momentum” for regulation, Twitter global vice president of public policy Sinead McSweeney said in WSJ, which reports that “in recent weeks the company has had to implement new legislative requirements in at least six countries.”

Google has agreed to remove tracking cookies from its Chrome browser in the UK in order to appease the CMA and is exploring new ways to handle “user and partner information internally,” in addition to other proactive steps, WSJ writes. Preemptive moves are viewed as preferable to fending off new rules that could present compliance challenges in tight timeframes.

In November, Australia announced it would introduce legislation making it possible to hold social media companies liable for defamation.

“For their part, advocates for more regulation worry that the Big Tech companies could emerge unscathed from the newest wave of regulation,” writes WSJ, citing privacy-centric browser DuckDuckGo’s founder and CEO Gabriel Weinberg as one such skeptic. More than $9 billion in EU fines has done little to tamp down Google’s dominance in search.

Closer to home, “Facebook, Google, Apple and Amazon over the past decade have significantly increased their lobbying forces in Washington as they fight a rising tide of scrutiny over privacy, competition and content moderation,” reports WaPo. “Amazon spent approximately $18 million on lobbying in 2020, while Facebook spent a record-breaking $20 million.”

The new scrutiny, exemplified by a flood of congressional hearings through the summer and fall as to Big Tech business practices, “has already made it more difficult for the companies to cash in on potential growth from acquisitions,” said Evercore head of Internet research Mark Mahaney, indicating that the climate is having an effect even before new laws are passed.

Related:
Apple Says Senate’s Big-Tech Legislation Would Weaken Its User-Privacy Push, The Wall Street Journal, 1/18/22
Regulators Aim to Rewrite Rules for Big Mergers, The New York Times, 1/18/22
Italy Has Quietly Become One of Big Tech’s Most Prolific Antagonists, CNBC, 1/18/22