At the hearing, Klobuchar highlighted America’s monopoly problem as well as serious concerns that Google uses its unparalleled market power to distort competition 

WATCH VIDEO REMARKS HERE

WASHINGTON — Today, at a Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights on competition in online advertising technology, Ranking Member Amy Klobuchar (D-MN) called for important antitrust reforms needed to address the business conduct of one of America’s most powerful companies, Google. Klobuchar and the Subcommittee members examined allegations that Google has been using its market dominance and its unparalleled access to consumer data to distort competition in the advertising technology marketplace.

“We are having [this hearing] because even successful companies, even popular companies, and even innovative companies are subject to the laws of this country including our antitrust laws. We are all successful when we make sure that our economy is strong and our economy is working better. But the law can't be blinded by Google's success or its past innovations if the company--in its zeal to achieve greater success--crosses a line into anticompetitive behavior. It's our job to regulate it. It's that simple,” Klobuchar said in remarks at the hearing. 

“[First,] What can we do for enforcement? Second, what do we have to do to make the laws work better, to look at some of the deals that have already been made. The third is what are the remedies? Do they make a difference in changing the behavior and allowing competition? 

“...I want [our system] to work and to have it work you simply can't have one company dominating areas of an industry. Our founding fathers started this country in part because they were rebelling against monopoly power. We need to keep that spirit of entrepreneurship strong in this country and this is a good way to start.” 

In addition to Google’s President of Global Partnerships and Corporate Development, Donald Harrison, the committee heard testimony from Adam Heimlich, Chief Executive Officer of Chalice Custom Algorithms; David Dinielli, Senior Advisor at Beneficial Technology, Omidyar Network; and Carl Szabo, Vice President and General Counsel at Netchoice. 

Video of Klobuchar’s remarks at the hearing can be found HERE and in a transcript of her opening remarks below.

In her role as Ranking Member of the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, Klobuchar has championed efforts to protect consumers, promote competition, and fight excessive consolidation in major industries, including the telecommunications, technology, agriculture, and pharmaceutical sectors.

In August, at a Senate Commerce Committee Hearing titled, “Oversight of the Federal Trade Commission,” U.S. Senator Amy Klobuchar (D-MN) highlighted the urgent need to protect consumers’ privacy and strengthen enforcement of antitrust laws.

In July, Klobuchar led a letter to the Department of Justice (DOJ) to urge the Antitrust Division to conduct a comprehensive review of Google’s proposed acquisition of Fitbit. The Senators raised concerns that some of these acquisitions may contribute to Google’s enduring dominance in several markets.  

In May, Klobuchar and 14 colleagues sent a letter to Assistant Attorney General for Antitrust Makan Delrahim and Federal Trade Commission (FTC) Chairman Joseph Simons, urging the Department of Justice and the FTC to be vigilant in enforcing the antitrust laws and protecting consumers during and after the coronavirus (COVID-19) pandemic.  

Also in May, Klobuchar, Blumenthal, and Booker called on the DOJ to monitor the live performance marketplace to ensure that small and independent venues will have the chance to compete on a level playing field once this crisis has ended.

Klobuchar leads the Consolidation Prevention and Competition Promotion Act to restore the original purpose of the Clayton Antitrust Act to promote competition and protect American consumers. The bill would strengthen the current legal standard to help stop harmful consolidation that may materially lessen competition.

In March 2020, Klobuchar introduced the Anticompetitive Exclusionary Conduct Prevention Act which prohibits anticompetitive exclusionary conduct that risks harm to the competitive process. It also makes reforms to improve antitrust enforcement across the board. The bill was cosponsored by Senators Richard Blumenthal (D-CT) and Cory Booker (D-NJ).

In August 2019, Klobuchar introduced the Monopolization Deterrence Act to crack down on monopolies that violate antitrust law. The legislation would give the DOJ and FTC the authority to seek civil penalties for monopolization offenses under the antitrust laws, a power they currently do not have. The bill is cosponsored by Senators Blumenthal, Dianne Feinstein (D-CA), and Ed Markey (D-MA).

Klobuchar has also been an outspoken voice in opposing anticompetitive mergers and has introduced legislation to help prevent them. In June 2019, Klobuchar and Senator Chuck Grassley (R-IA) introduced new bipartisan legislation to ensure that antitrust authorities have the resources they need to protect consumers. The Merger Filing Fee Modernization Act would update merger filing fees for the first time since 2001, lower the burden on small and medium-sized businesses, ensure larger deals bring in more income, and raise enough revenue so that taxpayer dollars aren’t required to fund necessary increases to agency enforcement budgets.

Transcript of opening remarks at September 15th hearing: 

Thank you so much, Mr. Chairman, and thank you to our witnesses, to Mr. Harrison appearing virtually and I want to start by making something absolutely clear.

We are not having this hearing because Google is successful. Google is successful. I just used it on my way here. Or because Google is big. That's not why,from my perspective, we're having this hearing. We are having it because even successful companies, even popular companies, and even innovative companies are subject to the laws of this country including our antitrust laws. 

We are all successful when we make sure that our economy is strong and our economy is working better. But the law can't be blinded by Google's success or its past innovations if the company in its zeal to achieve greater success crosses a line into anticompetitive behavior. It's our job to regulate it. It's that simple. So we're going to touch on issues, I hope, today of competition, technological innovation, the use of personal data. These are some of the defining issues, as the chair has said, defining issues of our time and I personally think, as we go into the months to come, this won't just be about Google. This isn't even just about the tech industry as much as I believe we need to change our laws and look at monopsonies and look at changing the burdens and making it so that our laws are as sophisticated as the companies that now occupy our economy.

I think we need to do all that and I think it should be a huge priority going into the year. But right now as the chairman mentioned, we are focused on this issue today. Our society has never been more dependent on this technology than we are now in the midst of this global pandemic. As I noted, not just Google, the pandemic has forced a bunch of small businesses to close their doors and the five largest tech companies continue to thrive to the point where they briefly accounted for nearly 25% value of the entire S&P 500 stock index just a few weeks ago.

Again, I don't quarrel with their success, but we have to start looking at do our laws really match that situation. And even if the original intent when these companies started as start-ups was to be innovative, which they've been, at what point do you cross the line so you squelch innovation and competition from other companies? We start with this, the ownership and use of data.

The powerful companies that provide us with these technologies are also collecting personal information. We know that. They know who our friends are, they know the books we read, where we live, whether we've graduated from college, income levels, race, how many steps we took yesterday. The chairman and I share an interest in this. How long we've stayed where we are. Machine learning analyzes troves of personal data, allowing our firms to discern even more sensitive information about us, our medical conditions, political, religious views and even preferences that we don't even know we have. And why would companies do all of this? Well, put simply, to target us with digital advertisements. There's really no other reason. It is a capitalist society. That's what they do.

Now, Google makes more money doing that than any company in the world, hands down, by leveraging its unmatched access to consumer data gained through its existing dominance in online and mobile search, mobile operating systems, Android, email, Gmail, online and mobile video, YouTube, browsers, Chrome, mobile mapping apps, Google maps and ad technology.

So, this ad technology ecosystem, known as the ad tech stack, consists of advertisers on one side and publishers on the other. So let’s look at these two sides. On the advertising side Google controls access to the huge number of advertisers that place ads on Google search which is nearly 90% of the search market and has unparalleled access to data as I described. On the publisher side, Google has privileged access to ad data to inform its bidding strategies. And then it also effectively controls the process, the ad auction process, that gets an advertiser's ad to be put on a publisher's site. Google dominates all the markets for services on both sides of the ad/tech stack, the publisher side and the advertising side, and I hope that will be a lot of our focus today. Research has suggested that Google may be taking between 30 and 70 percent of every advertising dollar spent by advertisers using its services depriving publishers of that revenue. Who are the publishers? They're content producers. They’re things like the Minneapolis Star Tribune, they depend on revenue, so many of our content producers, our news producers do to get by.  

And to me, given that my dad was a journalist, to me this is one of the key elements here because if you have unfairness in how that ad echo system is going, then you're depriving these news organizations at a time when the first amendment is already under assault of the revenue that they need to keep going. So whether it's happening, and we don't know all of the details at the Department of Justice right now, this could be the beginning of a reckoning for our antitrust laws to start looking at how we're going to grapple with the new kinds of markets that we see across the country. It would help answer the question whether our federal antitrust laws are able to restrain the business conduct of even the largest, most successful companies in the world. When you think of the breakup of AT&T, that was our last big thing that happened in the antitrust area. Really big thing. What did that lead to? Lower prices, more competition. It really worked. But we're not able to do this right now.

And my hope is that we're getting the start and the Justice Department, that things are going on at the FTC. But to really do that, they're going to do resources to take on the legions of lawyers at the companies and that's my first goal. What can we do for enforcement? My second, what do we have to do to make the laws work better, to look at some of the deals that have already been made? The third is what are the remedies? Do they make a difference in changing the behavior and allowing competition? I literally don't have personal grudges against these companies like sometimes the president has expressed about various companies. I don't. I just want our capitalist system to work. I want it to work. And to have it work you simply can't have one company dominating areas of an industry. Our Founding Fathers started this country in part because they were rebelling against monopoly power.

We need to keep that spirit of entrepreneurship strong in this country and this is a good way to start. Thank you, Mr. Chairman. I may not be here right at the time, because of the votes, for the questions, but I will be here for questions. Thank you.

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