(Reuters) – Senator Elizabeth Warren said on Friday that if elected U.S. president she would seek to break up Amazon.com Inc, Alphabet Inc’s Google and Facebook Inc as part of a structural change to the tech sector aimed at promoting competition.
FILE PHOTO: Democratic 2020 U.S. presidential candidate and U.S. Senator Elizabeth Warren (D-MA) arrives a Senate Banking and Housing and Urban Affairs Committee hearing on “The Semiannual Monetary Policy Report to Congress” on Capitol Hill in Washington, U.S., February 26, 2019. REUTERS/Jim Young
Warren, who is seeking to stand out in a Democratic field crowded with progressives vying to take on U.S. President Donald Trump in the November 2020 election, said in a blog post that on their way to the top, the companies purchased potential competitors, like Facebook’s acquisition of Instagram.
“They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else. And in the process, they have hurt small businesses and stifled innovation,” Warren wrote.
Amazon shares were down 0.8 percent while Facebook was down 0.2 percent while Alphabet slipped 0.1 percent in morning trade on Friday.
Warren said that she would nominate regulators who would unwind acquisitions such as Facebook’s deals for WhatsApp and Instagram, Amazon’s deals for Whole Foods and Zappos, and Google’s purchases of Waze, Nest and DoubleClick.
Amazon and Google did not immediately respond to requests for comment. Facebook declined to comment.
NetChoice, an e-commerce trade group whose members include Facebook and other online companies, said Warren’s plan would lead to higher prices for Americans.
“Sen. Warren is wrong in her assertion that tech markets lack competition. Never before have consumers and workers had more access to goods, services, and opportunities online,” said Carl Szabo, vice president and general counsel for NetChoice.
The Competitive Enterprise Institute (CEI), a think tank that promotes free markets, called Warren’s plan a “doomed regulatory experiment.”
“The next wave of technological innovations will likely require enormous economies of scale to serve consumers. In the meantime, there are no barriers to entry for the next killer app or sector-disrupting entrepreneur,” said Jessica Melugin, the CEI’s associate director for technology and innovation.
The liberal activist group Demand Progress has previously called for the U.S. government to break up Facebook by forcing it to sell Instagram, WhatsApp and Messenger.
Tech companies are some of the biggest political donors. Google spent $21 million to lobby in 2018 while Amazon spent $14.2 million and Facebook spent $12.62 million, according to their filings to U.S. Congress.
Warren made her political mark by going after big banks after the 2007-2009 financial crisis. In the Senate, Warren continues to be an outspoken critic of Wall Street and is a leader of her party’s progressive wing.
Reporting by Sayanti Chakraborty in Bengaluru; Editing by Arun Koyyur and Meredith Mazzilli