SAN FRANCISCO - Facebook on Monday said it is asking EU courts to review "exceptionally broad" requests by antitrust regulators there that would scoop up employees' personal information.
The US-based internet colossus maintained it has been cooperating with a European Commission antitrust investigation and will continue to do so, but that the wording of commission requests casts a net so wide it will haul in Facebook employees' private messages and more.
The leading social network expects to give the commission hundreds of thousands of documents, according to Facebook associate general counsel for competition Tim Lamb.
"The exceptionally broad nature of the commission's requests means we would be required to turn over predominantly irrelevant documents that have nothing to do with the commission's investigations," Lamb said in response to an AFP inquiry.
Those documents include "highly sensitive personal information such as employees' medical information; personal financial documents, and private information about family members of employees."
Facebook thinks such requests should be reviewed by EU courts, according to Lamb, and is asking the court to weigh in on broad search terms such as "applause" or "for free" that could easily be found in personal email messages or other exchanges way beyond the scope of antitrust matters.
Regulatory probes can involve requests for messages or documents bearing certain words or phrases, with those seeking information inclined to craft wide nets and those being queried wanting them narrowly targeted.
A highly anticipated US antitrust hearing, including top executives of four Big Tech firms, was originally set for Monday but has been postponed.
A notice filed by the House Judiciary Committee set no new date for the hearing titled "Examining the Dominance of Amazon, Apple, Facebook, and Google."
The hearing would have conflicted with the memorial service for the late representative and civil rights leader John Lewis, who will lie in state in the US Capitol until Tuesday.
The antitrust hearing was called amid rising concerns over Big Tech dominance, which has become even more pronounced during the coronavirus pandemic and coincides with investigations at the federal and state levels into the online giants.
Chief executives Tim Cook of Apple, Jeff Bezos of Amazon, Mark Zuckerberg of Facebook and Sundar Pichai of Google and its parent firm Alphabet had agreed to participate in the session.
Agence France-Presse
BRUSSELS - The EU's powerful antitrust authority opened a series of cases against Apple on Tuesday, including one brought by Spotify alleging the iPhone maker makes unfair use of its app store.
The European Commission also launched an in-depth investigation into Apple Pay, amid concerns that the fast-growing and easy-to-use payment system is shutting out rivals.
The cases put Apple back into the EU's crosshairs four years after Brussels ordered the California-based giant to repay 13 billion euros ($14.7 billion at current rates) in back taxes on antitrust concerns.
The latest onslaught came after Spotify filed a formal complaint in 2019 that took issue with restrictions by Apple on apps that don't use its payment system on its App Store.
Apple takes a 30 percent cut for businesses using its store, which Spotify says amounts to a violation of fair competition rules.
"It appears that Apple obtained a 'gatekeeper' role when it comes to the distribution of apps and content to users of Apple's popular devices," said EU Executive Vice President Margrethe Vestager in a statement.
"We need to ensure that Apple's rules do not distort competition in markets where Apple is competing with other app developers, for example with its music streaming service Apple Music or with Apple Books," she said.
Vestager also opened a full-scale probe into Apple Pay where authorities are worried that the company could take a commanding lead in a booming business.
Launched in 2014, Apple Pay allows iPhone users to make payments at retailers by touching their devices to the same terminals currently used for credit and debit cards.
But any company wanting to use the technology on an iPhone -- whether a bank or the London metro system -- must pass through Apple Pay for a fee.
Apple firmly rejected the cases and hit out at its rivals.
"It's disappointing the European Commission is advancing baseless complaints from a handful of companies who simply want a free ride, and don't want to play by the same rules as everyone else," Apple said in a statement.
"We don't think that’s right — we want to maintain a level playing field where anyone with determination and a great idea can succeed," the company added.
Agence France-Presse
WASHINGTON — A US regulatory agency said Tuesday it would review acquisitions made by 5 Big Tech firms over the past decade -- opening the door to a wave of potential antitrust investigations.
The bombshell announcement by the US Federal Trade Commission opens the door to fresh scrutiny of deals made by Amazon, Apple, Facebook, Microsoft and Google parent Alphabet since 2010.
The move comes amid growing complaints about tech platforms which have dominated key economic sectors, and calls by some activists and politicians to break up the Silicon Valley giants.
FTC chairman Joe Simons said the agency's action was a "research and policy project" but could lead to legal "enforcement" actions on deals consummated over the past decade.
"We could go back and institute antitrust enforcement" as a result of the review, Simons told reporters on a conference call.
The agency declined to comment on any specific deals, and antitrust experts have debated the legal and practical issues of attempting to "unwind" past acquisitions.
Asked on the call about the potential impact, Simons said, "It could result in unwinding" of past deals.
The FTC said in a statement it ordered the 5 firms "to provide information about prior acquisitions not reported to the antitrust agencies" between Jan. 1, 2010 and Dec. 31, 2019.
The agency said it would look at hundreds of transactions which may not have been reviewed for potential antitrust concerns.
It was unclear if the FTC action could lead to new scrutiny of big deals such as Facebook's acquisition of Instagram and WhatsApp or Google's takeover of the smart home maker Nest, which had been previously cleared by antitrust enforcers.
But the possibility of seeking to undo some mergers from years earlier stunned some tech industry observers.
"It could be incredibly difficult and painful to untangle some of these deals," said Robert Atkinson, president of the Information Technology and Innovation Foundation, a think tank which is often aligned with the industry.
"They're all integrated. It's like a milkshake, you can't pull them apart."
TAKING OUT COMPETITORS
Simons said the review would look notably at "acquisitions that took out what could have become a threat to the platform," and noted that the agency would consider remedies from changes in business conduct to breakups.
The US Justice Department has already said it is reviewing potential anti-competitive actions by major tech platforms, and attorneys general from the majority of US states have launched antitrust investigations of Google and Facebook.
The actions come against a growing "techlash" reflecting declining public trust in big online firms, and hefty fines levied against Facebook and Google over privacy violations.
Some analysts downplayed the likelihood of the FTC review leading to any major action.
"It's way too early to speculate about whether this leads to any lawsuits to unwind deals. Those are rare and hard," said Avery Gardiner, a former Justice Department antitrust lawyer who is now a fellow with the Center for Democracy & Technology.
"My guess is that this is more about understanding whether the system is being gamed."
Eric Goldman, head of the High Tech Law Institute at Santa Clara University, said the review is more likely to shifts in analyzing mergers.
"I know a lot of folks are excited about the prospect of breaking up Big Tech, but this study is not likely to lead to that outcome," Goldman said.
Christopher Sagers, a Cleveland State University law professor specializing in antitrust, said courts were unlikely to consider a post-merger review after about 4 years.
The FTC engages "in lots of activity, including workshops, seminars, investigations, and reviews, but very little of it is actual enforcement," he said.
Agence France-Presse
SAN FRANCISCO - Facebook Inc began cutting off access to user data for app developers from 2012 to squash potential rivals while presenting the move to the general public as a boon for user privacy, according to court documents reviewed by Reuters.
Some executives at the world's biggest social network appeared to refer to the strategy of promoting a privacy-focused explanation for the change as the "Switcharoo Plan," internal emails included in sealed California court filings show.
The emergence of nearly 7,000 pages of company emails and executive documents comes as Facebook faces multiple investigations into possible antitrust violations by regulators around the world.
The emails could supply valuable evidence to investigators, including a U.S. House of Representatives panel that sought company records in September on Facebook's decisions to bar apps from its social graph, which maps out relations between users.
The documents come from a lawsuit filed in 2015 by Six4Three, the developer of a now-shuttered bikini photo app that lost access to Facebook user data as a result of the changes, which were announced in 2014 and implemented the following year.
Six4Three alleges that Facebook's data policies were anticompetitive and that the company misrepresented those policies both to developers and the public.
Facebook has described the case as baseless. A company spokeswoman told Reuters the documents were "taken out of context by someone with an agenda against Facebook" and made public "with a total disregard for U.S. law."
Portions of the material have been released over the course of the past year, after a British lawmaker obtained them, but provided an incomplete picture of the period between 2012 and 2014 when policy changes were debated within the company.
The new documents contain exchanges between executives discussing cutting off access to user data for developers seen as potential competitors at a time when the company said publicly that it provided an open and neutral platform.
One executive, writing in 2013, described dividing apps into "three buckets: existing competitors, possible future competitors, developers that we have alignment with on business models" as part of the project to restrict access to user data, dubbed 'PS12N'.
Those in the last category were able to regain access by agreeing to make mobile advertising purchases or provide reciprocal user data to Facebook under "Private Extended API Agreements," according to the emails.
As thousands of developers lost access to user data, the executives decided to announce the changes publicly. They elected to link what they referred to as the "'bad stuff' of PS12N" to an unrelated update of the Facebook login system which gave people greater control over their privacy.
The "narrative" for the announcement "will focus on quality and the user experience which will potentially provide a good umbrella to fold in some of the API deprecations," one executive wrote in an email.
Another invited colleagues in a February 2014 email to review the "Switcharoo Plan," calling it "a good compromise" that will enable them "to tell a story that makes sense."
The month prior, the same executive wrote: "My concern is around the perception that we can't hold our story together."
When Facebook enacted the changes in 2015, executives told journalists the company had conducted research on user sentiment about Facebook apps and decided on policies that would help build confidence in data privacy, according to a report by tech publication TechCrunch.
source: news.abs-cbn.com
SEATTLE — Google fired its opening salvo in what is expected to be a protracted antitrust fight with four dozen states, demanding more protections before it hands over confidential business documents sought by investigators.
In a petition filed Thursday in Texas state court of Travis County, Google, along with its parent company Alphabet, sought a protective order against Ken Paxton, the attorney general of Texas, who is spearheading the multistate antitrust investigation into the company.
The petition said Paxton had not provided sufficient safeguards for how his office shares Google’s sensitive business documents with outside consultants to the investigation. Google said some of those outside consultants were also working for competitors or complainants.
It is first legal challenge made by Google since the attorneys general from 48 states as well as the District of Columbia and Puerto Rico said in September that they were starting an antitrust investigation into the market power and corporate behavior of Google, with Paxton taking the lead.
On the same day it announced the investigation, Paxton’s office served Google with a civil investigative demand, seeking what the company called “highly proprietary, competitively sensitive, and otherwise confidential business information” including internal planning memos, strategic documents and white papers. Google has until Nov. 9 to start producing documents related to the 233 requests made by the office.
“Given the breadth of confidential business information sought by the (attorney general’s office) and the heightened risks of leaks and disclosure to Google’s competitors and complainants in this and other regulatory proceedings, a protective order is appropriate and necessary,” Google wrote.
Google’s petition is largely a procedural move, but it offers insight both into who is helping the attorneys general and what Google is worried about as it enters what could be a long legal tussle. In addition to the state inquiries, House and Senate committees, the Justice Department and the Federal Trade Commission are also looking into the company’s business practices.
In a statement, the Texas attorney general’s office said it was caught off-guard by Google’s petition “challenging our right to employ many of the most knowledgeable in this complex field.” It said it had been working with Google to discuss “appropriate confidentiality provisions” to ensure that the information would not be used by the company’s competitors, but what Google wanted would compromise the investigation.
“Google’s petition is nothing more than an effort to hamstring the investigation. But Google is not entitled to choose the states’ expert or run the states’ investigation,” Marc Rylander, communications director for Paxton, said in a statement.
Google said it wanted to be notified in advance before the attorney general’s office shared its confidential company information with third parties such as consultants and sought limits on the ability of outside consultants with access to those documents from working with Google’s competitors.
Google also asked for a “cooling-off” period to prevent consultants from jumping into another job advising competitors based on what it learned during the course of the investigation.
Google pointed to the background of two of the three consultants to the investigation as particularly worrisome. One had served as a consultant to companies that have been vocal in their criticism of Google, including News Corp. and the Russian search engine Yandex. The other, a former lawyer for Microsoft, had also represented clients in other antitrust and other cases against Google.
“This is an extraordinarily irregular arrangement and it’s only fair to have assurances that our confidential business information won’t be shared with competitors or vocal complainants,” said Jose Castaneda, a Google spokesman.
It is not unusual for government investigations to coordinate antitrust arguments with competitors of the company it is investigating. This also happened in the monopoly case against Microsoft in the 1990s.
“This looks like a sideshow,” said David Segal, executive director at Demand Progress, an activist group focused on issues of corporate power and internet freedom. He called Google’s actions “standard delay and deflect tactics by which one of the most powerful corporations in the history of the world” was trying to avoid scrutiny.
2019 The New York Times Company
source: news.abs-cbn.com
SAN FRANCISCO/NEW YORK - US authorities investigating Alphabet Inc's Google for anti-competitive behavior have recently begun probing the company's $116 billion-a-year advertising business.
Attorneys general for 50 US states and territories along with the US Department of Justice appear to be acting on accusations from rivals, lawmakers and consumer advocacy groups that the biggest seller of online ads engages in unfair tactics. Google disputes its dominance.
"Ad tech is a very crowded field, and Google competes with hundreds of companies, including household names like Adobe, Amazon, AT&T, Comcast, News Corp and Verizon," company spokesman Josh Zeitz said. "Publishers and advertisers mix and match technology partners to meet their different needs, creating both competition and innovation."
Later, in response to this story, Google reiterated in a blog post that its services foster competition.
"Our tools and platforms make it easy for advertisers and publishers of all sizes to choose whom they want to work with in this open, interconnected ad system," Google Vice President Sissie Hsiao wrote.
Here are 5 common concerns about Google raised by 10 ad industry executives, most speaking on the condition of anonymity.
SEARCH AND YOUTUBE
About 80 percent of Google's ad revenue and most of its profits come from ads within Google search results, YouTube, Gmail and other internet services the company owns. Rivals say that Google controls these properties in a way that hinders advertising competition.
For instance, the only technology system for buying ads on YouTube, the world's largest video streaming website, is Google's ad buying tool. Services such as Facebook Inc maintain similar control, in part to limit too widely sharing users' data. But as YouTube increasingly dominates online video, rival tools for placing ads in video streams become less attractive to advertisers because they can only access smaller audiences.
"It's incredibly difficult to compete with the monopoly search and video sites," said Brian O'Kelley, founder and former CEO of ad tech company AppNexus, in an interview in June.
ACQUISITIONS
The remaining 20 percent of Google’s ad revenue is from what is commonly referred to as its “display business.” Google boosted this operation by acquiring seller tools such as DoubleClick for $3.1 billion in 2008 and AdMob for $750 million in 2010 and then buyer services including Invite Media for a reported $81 million in 2010.
The combination of deals gave Google unprecedented positioning in every facet of how ads end up on websites and smartphone apps around the world. Though US regulators approved the deals, their worst-case predictions about Google being too powerful have come true, rivals say.
To poach big customers from Google, smaller firms say they would need the cash to diversify their businesses and develop a complete suite of services. But drawing investment has been challenging because of the looming threats of Google and increased data privacy regulation.
BUNDLING
Google's variety of ad tools enable it to bundle them in a way that rivals say they cannot afford to match. For instance, websites and app owners, together known as publishers, over the years have become reliant on Google's DoubleClick ad serving tool. Nearly free to use for publishers, it is the only system of its kind that can receive real-time bids from Google's ads marketplace, known in the industry as AdX.
The popular marketplace, which matches up ad buyers with publishers, is where Google collects high fees.
Rivals said when using the Google ad-buying tool, advertisers get some key consumer data for free, early access to some purchasing options and potentially additional benefits if transacting through AdX. Google's packages for buyers and sellers to boost use of AdX are viewed as anti-competitive by rivals.
"The ubiquity of Google’s ad server provides virtually total control over which ads are shown and monetized for the majority of the Internet," said Romain Job, chief strategy officer at competitor Smart AdServer. "This control of the ad server is strategically critical to Google."
LAST LOOK
Google has allowed publishers using DoubleClick to sell ad space on various marketplaces, not just AdX. But for many years, Google’s AdX widely held a special advantage: At the last second it could give its customers the opportunity to outbid competing advertisers trying to purchase through other, non-Google, marketplaces.
This "last look" was one of several ways rivals allege Google favored itself. Google last week announced that the elimination of "last look" as part of move to a new sales system.
But publishers and rivals still wonder whether Google may be using its vantage point over the whole ecosystem to keep prices down for advertisers and make itself outperform other marketplaces by analyzing their matchmaking strategies and copying them. Among specific concerns is that just being part of Google enables AdX to glean more information than rival exchanges about consumers, making AdX more attractive to advertisers.
CHROME
The newest area of concern is how Google may be using its Chrome internet browser, which has about 50 percent market share in the United States, to restrict most advertising systems, beside its own, from building profiles on consumers as they browse the web.
The restrictions, many of which remain proposals subject to change, largely spare Google because consumers often sign into their Google accounts when using Chrome. That enables a form of tracking that it is not possible for ad tech firms that do not offer any services directly to users.
Google has said its initiative is aimed at helping users curb tracking, as they demand greater privacy protections. Other browser makers have adopted more stringent restrictions, but Google has said its striving for a middle ground between violating users' privacy and violating antitrust rules.
source: news.abs-cbn.com
If you opened the App Store on an iPhone recently and typed “music” in the search box, the first result would have been Apple’s iTunes.
The next would have been Apple Music. Then several more from the company, including some not related to music at all, like iMovie. On some days, you would have had to scroll through as many as eight Apple apps before finding one made by a different publisher.
This, according to Apple, was how the App Store was supposed to work. And that, critics say, is the problem.
Top spots in App Store search results are some of the most fought-over real estate in the online economy. The store generated more than $50 billion in sales last year, and the company said two-thirds of app downloads started with a search.
But as Apple has become one of the largest competitors on a platform that it controls, suspicions that the company has been tipping the scales in its own favor are at the heart of antitrust complaints in the United States, Europe and Russia.
Apple’s apps have ranked first recently for at least 700 search terms in the store, according to a New York Times analysis of six years of search results compiled by Sensor Tower, an app analytics firm. Some searches produced as many as 14 Apple apps before showing results from rivals, the analysis showed. (Though competitors could pay Apple to place ads above the Apple results.)
Presented with the results of the analysis, two senior Apple executives acknowledged in a recent interview that, for more than a year, the top results of many common searches in the iPhone App Store were packed with the company’s own apps. That was the case even when the Apple apps were less relevant and less popular than ones from its competitors. The executives said the company had since adjusted the algorithm so that fewer of its own apps appeared at the top of search results.
The Times’ analysis of App Store data — which included rankings of more than 1,800 specific apps across 13 keywords since 2013 — illustrated the influence as well as the opacity of the algorithms that underpin tech companies’ platforms.
Those algorithms can help decide which apps are installed, which articles are read and which products are bought. But Apple and other tech giants like Facebook and Google will not explain in detail how such algorithms work — even when they blame the algorithm for problems.
Philip Schiller, Apple’s senior vice president who oversees the App Store, and Eddy Cue, the senior vice president who oversees many of the Apple apps that benefited from the results, said there was nothing underhanded about the algorithm the company had built to display search results in the store.
The executives said the company did not manually alter search results to benefit itself. Instead, they said, Apple apps generally rank higher than competitors because of their popularity and because their generic names are often a close match to broad search terms.
“There’s nothing about the way we run search in the App Store that’s designed or intended to drive Apple’s downloads of our own apps,” Schiller said. “We’ll present results based on what we think the user wants.”
Apple added its apps to the App Store in June 2016. Since then, it has been the top result for many popular search terms, according to the Sensor Tower data. Those Apple apps held on for years while top rivals remained stuck below, sometimes hundreds of spots down the list, the data shows.
An Apple spokeswoman said the company could not verify the data because it did not keep a record of historical search results.
The company is facing the most direct legal challenge in the United States to the clout it has built up through its App Store. In May, the Supreme Court voted 5-4 to allow an antitrust class action against Apple to move forward, saying consumers should be allowed to try to prove that the technology giant had used monopoly power to raise the prices of iPhone apps.
When multiple Apple apps packed the search results, such as in searches for “music,” the Apple executives attributed the results to a feature of the App Store search engine that sometimes grouped apps by maker. They tweaked that feature in July so Apple apps would no longer look as if they were receiving special treatment. Many Apple apps dropped as a result.
Still, the executives denied that there had been a problem that needed fixing.
“It’s not corrected,” Schiller said.
“It’s improved,” said Cue.
Several consultants who study the App Store algorithm to help companies rank higher said Apple’s consistent success in the marketplace was suspicious. Algorithms are automated systems designed to largely run on their own. But it is humans who decide what algorithms measure. And those decisions can be subjective.
“I find it hard to believe that organically there are certain Apple apps that rank better than higher-reviewed, more downloaded competitors,” said Todd Dunham, chief executive of the ASO Project, which consults app makers on how to rank higher in the results.
Some of the search results found in The Times’ analysis appeared “steered,” said Eric Enge, an App Store consultant for Perficient, a consulting firm. “It’s no question that the app universe is one of the major battlegrounds out there, and there’s just a ton to be gained commercially by dominating,” he said.
The search algorithm in the App Store was built by a small team of engineers in Cupertino, California, some of whom said in a separate interview arranged by Apple that they hadn’t noticed for months that Apple was dominating search results for music and other categories.
Once they did notice, they said, a single engineer decided to change the algorithm.
The engineers said they had to be vague when talking about how their algorithm worked, to avoid revealing too much to fraudsters looking to game it. The algorithm examines 42 different signals, they said, including an app’s relevance to a given search, its ratings, and its popularity based on downloads and user clicks.
Apple introduced the App Store in 2008, and it quickly revolutionized the mobile-phone industry, creating a new marketplace for people to download games, tools for work and social-networking services. More than 2 million apps are available on the App Store.
Apple’s tight control of its App Store has led to a marketplace that appears to be less susceptible to fraud than the Play Store, the app marketplace on Android smartphones that is run by Google. Google’s Play Store results are partly personalized, so each person might see a different set of results.
Companies like Facebook, Spotify and Yelp have thrived on Apple’s platform, which typically generates more money for app developers than Google’s Play Store.
To get their apps discovered, companies try to push them up the ranks in the App Store’s search results. There is an industry of consultants who charge for their expertise on setting the right title, description and other details to please the App Store algorithm.
But Apple’s algorithm also appears to have been a boon for its own apps.
On Aug. 21, Apple apps ranked first in 735 of roughly 60,000 search terms tracked by Sensor Tower. Most of the tracked searches were obscure, but Apple’s apps ranked first for many of the popular queries. For instance, for most of June and July, Apple apps were the top result for these search terms: books, music, news, magazines, podcasts, video, TV, movies, sports, card, gift, money, credit, debit, fitness, people, friends, time, notes, docs, files, cloud, storage, message, home, store, mail, maps, traffic, stocks and weather.
The Wall Street Journal also found that Apple apps regularly ranked first for many searches in an analysis of 600 searches over two days in June.
Apple succeeded in some of the App Store’s most hotly contested search results. At least four Apple apps led the results for “TV” from at least June 2018 to last month. Netflix has been stuck mostly in the hundreds.
In searches for “music,” Spotify was for years the first result, but the Apple Music app took the top spot shortly after it was arrived in the App Store in June 2016. By the end of 2018, the top eight results were Apple apps, some unrelated to music.
If you searched for “podcast” in May 2018, you would have had to scroll through as many as 14 Apple apps before finding one made by another publisher.
While the Apple Podcasts app has held the No. 1 spot for “podcast” searches since June 2016, other popular podcast apps have struggled in the rankings. A competitor named Stitcher, for instance, has been stuck in the hundreds of podcast search results since June 2018.
That has taken a toll on Stitcher’s business. Amy Fitzgibbons, Stitcher’s marketing chief, said people searching “podcast” accounted for the majority of Stitcher’s downloads on Google’s rival Play Store. “In the Apple App Store, ‘podcast’ did not even rank as a source of downloads for us,” she said.
The Times analysis uncovered other surprising examples of Apple apps’ success. On March 25, the company unveiled an Apple-branded credit card that can be used via the Apple Wallet app. The next day, Apple Wallet was the No. 1 result in searches for “money,” “credit” and “debit.” The app had not ranked for those search terms before then.
Cue and other Apple executives speculated that the team marketing the Apple Wallet app had added “money,” “credit” and “debit” to the underlying description of the app, causing it to appear for those search results.
Then people searched those terms, found the Apple Wallet app and clicked on it, telling the algorithm that it should be the first result.
“We can just tell you that we’ve not done anything to drive that — that is, other than launching a great wallet, an Apple Card and marketing the heck out of it,” Schiller said.
When search results were flooded with Apple apps, Apple executives said, the algorithm concluded that people were looking for a specific Apple app and decided to surface other apps by the same developer.
That wasn’t always to Apple’s benefit. For instance, they said, searching “office” returns a series of Microsoft apps because the algorithm recognizes they are looking for Microsoft Office tools.
Apple engineers said the algorithm believed people searching “music” wanted just Apple Music because users clicked on the Apple Music app so frequently. Apple Music had a distinct advantage over other apps: It comes pre-installed on iPhones. Apple said some people used the search engine to find apps that were already on their phones.
When people search “music,” the App Store reminds them that they already have Apple Music installed. Many people then click on the app, the engineers said, adding to its popularity in the eyes of the algorithm.
Over the past several months, Apple engineers said, they began noticing how the algorithm was packing results with Apple apps. First, they stopped the algorithm from doing that for certain searches. In July, they turned it off for all Apple apps.
On July 12, many Apple apps dropped sharply in the rankings of popular searches. The top results for “TV” went from four Apple apps to two. “Video” and “maps” changed from three top Apple apps to one. And Apple Wallet dropped from the No. 1 spot for “money” and “credit.”
Schiller and Cue said the algorithm had been working properly. They simply decided to handicap themselves to help other developers.
“We make mistakes all the time,” Cue said.
“We’re happy to admit when we do,” Schiller said. “This wasn’t a mistake.”
2019 The New York Times Company
source: news.abs-cbn.com
WASHINGTON - The backlash against Big Tech moved into a new phase Monday as officials from nearly all US states announced an antitrust investigation into the dominance of internet giant Google.
The announcement from 50 attorneys general calls for a probe into whether Google abused its power in the online ecosystem at the expense of rivals or consumers.
The move, described as a preliminary probe of Google's actions in online advertising, highlights the growing complaints about Big Tech dominance and follows a separate investigation into Facebook announced last week by a coalition of US states.
Texas Attorney General Ken Paxton said the probe underscores fears about how Google benefits from data harvested from the online ecosystem.
"What we've all learned is that while many consumers believe the internet is free… the internet is not free," Paxton told a news conference in front of the US Supreme Court.
"There is nothing wrong with a business becoming the biggest game in town if it does so through free market competition, but we have seen evidence that Google's business practices may have undermined consumer choice, stifled innovation, violated users' privacy and put Google in control of the flow and dissemination of online information."
Utah Attorney General Sean Reyes, who joined the news conference, said: "The question for us is whether Google has strayed from its founding principles to not do evil."
Pennsylvania's Josh Shapiro added: "We're looking into whether Google's business practices have undermined free market competition -- and hurt consumers."
The probe is being backed by 48 states -- with only California and Alabama absent -- and joined by Puerto Rico and the federal District of Columbia, and officials stopped short of calling for any specific remedies such as a breakup -- which some Google critics have called for.
"It is an investigation to determine the facts," Paxton said. "Right now it is on advertising but the facts will lead where the facts will lead.
The latest probes come on top of a review launched earlier this year by federal regulators of major online platforms to determine if they have "stifled" innovation or reduced competition.
CONSUMER CHOICE?
Kent Walker, Google's senior vice president of global affairs, said in a blog post Friday that the company would cooperate with regulators while stressing that its services "help people, create more choice, and support thousands of jobs and small businesses across the United States."
According to research firm eMarketer, Google leads the US digital ad market with a 37.2 percent share worth some $48 billion this year and is expected to control 20 percent of all US ad spending, online and offline combined.
Google is by far the largest online search engine and captures nearly 75 percent of search-related online ads in the US, according to eMarketer.
STATES TAKE UP SLACK
Christopher Sagers, a Cleveland State University professor of antitrust law, said it was potentially "very significant" to see the state coalitions working on antitrust.
"After the past few years, the Trump administration's antitrust program has come to seem pretty inactive, influenced by a lot of politics that have made it hard to interpret," Sagers said.
On Friday, New York state Attorney General Letitia James announced an action on behalf of seven other states and the District of Columbia to probe "whether Facebook has stifled competition and put users at risk."
Facebook offered no immediate comment, but in the past it has claimed it is not a monopoly and that consumers have many choices for how to connect with people online.
'FISHING EXPEDITION?'
The antitrust actions come against a backdrop of declining public trust in big online firms, and fines levied against Facebook and Google over privacy violations.
Yet the legal basis for an antitrust action remains unclear, said Eric Goldman, director of the High Tech Law Institute at Santa Clara University.
"It remains to be seen if the (attorneys general) have any merit to their complaints or if they will be conducting a fishing expedition hoping to find some damning evidence," Goldman said.
"Companies as large as Google or Facebook probably have minor problematic practices the AGs could target, but I'm still waiting for any evidence that would support more structural challenges to the internet giants' practices."
Charlotte Slaiman of the consumer group Public Knowledge welcomed the new investigations as "an important and powerful step" which "can help consumers and innovative competitors access markets for platforms that are more fair and more competitive."
source: news.abs-cbn.com
A coalition of US states announced Friday an antitrust investigation of Facebook, in the first of what is expected to be a wave of action against dominant technology firms.
New York state Attorney General Letitia James released a statement announcing the action on behalf of seven other states and the District of Columbia to probe "whether Facebook has stifled competition and put users at risk."
The move marks the first official US antitrust action against one of the so-called Big Tech companies -- although a landmark case had targeted Microsoft back in the 1990s.
"Even the largest social media platform in the world must follow the law and respect consumers," James said.
"We will use every investigative tool at our disposal to determine whether Facebook's actions may have endangered consumer data, reduced the quality of consumers' choices, or increased the price of advertising."
Joining the action were attorneys general of Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, and Tennessee, said James.
Facebook did not immediately respond to an AFP query on the announcement.
- Federal review underway -
Earlier this year the US Justice Department said it would launch a "review" of major online platforms to determine if they have stifled innovation or reduced competition.
It was not immediately clear if the states would be working in coordination with federal officials.
Facebook, by far the largest social network, in the past has claimed it is not a monopoly and that consumers have many choices for how to connect with people online.
The new probe "shows how unease with large tech companies is spreading beyond Congress and the federal government agencies to the states. With each passing day, there are greater fears about these companies controlling our online lives," said Michael Carrier, a professor antitrust law at Rutgers University.
- Sign of 'techlash' -
The case may be the first in a series of antitrust actions against Big Tech firms and highlights growing "techlash," based on worries about dominant platforms which control the flow of information.
A separate coalition of states was set to launch an antitrust action, with Google reportedly a target.
The office of the Texas attorney general scheduled an event Monday in Washington with a "broad coalition of states" to unveil a multistate probe into "whether large tech companies have engaged in anticompetitive behavior that stifled competition, restricted access, and harmed consumers."
Asked about the move, Google spokesman Jose Castaneda said: "Google's services help people every day, create more choice for consumers, and support thousands of jobs and small businesses across the country. We continue to work constructively with regulators, including attorneys general, in answering questions about our business and the dynamic technology sector."
- What's the remedy? -
Maurice Stucke, a University of Tennessee law professor, said he expects one of the areas being investigated will be online advertising markets, which are dominated by Google and Facebook.
"This is a great area to look at because the market has been criticized as being opaque," Stucke said.
But Stucke said the investigations may go further by looking at how tech platforms control data, potentially examining "the intersection between competition law and privacy."
Amazon and Apple may also be in the crosshairs. Critics have complained that Amazon wields too much power in online retail, and that Apple may disadvantage rivals offering services in its app store.
In the European Union, Google has faced a series of antitrust actions and Amazon is now being targeted by enforcers.
Democratic presidential candidate Elizabeth Warren has made a breakup of the big tech firms a part of her campaign platform.
But some analysts say the case against the tech firms faces challenges because the companies have in many cases provided services for free and brought prices down, making it hard to prove they harmed "consumer welfare," the legal standard applied under judicial precedent.
Wedbush Securities analyst Daniel Ives said in a recent research note that "a broad movement to break up companies solely because they are large will fail without a change to existing antitrust laws," which he said is "exceedingly unlikely."
But Stucke said it would be wrong to view antitrust law as solely focused on consumer prices, and that it may be applied to questions of competition and innovation.
The probes could end up with a variety of outcomes including fines, restrictions on conduct or a breakup, Stucke maintained.
"You'd have to show how the remedy would address the concerns," he said.
source: news.abs-cbn.com
WASHINGTON - The United States on Tuesday announced it would begin an antitrust review of major online platforms to determine if they have "stifled" innovation or reduced competition.
The announcement by the Justice Department did not name specific companies but appeared to signal the department was targeting Google, Facebook and Amazon, which dominate key sectors of the digital economy.
It was not immediately clear if the probe would also target Apple, which despite not being the dominant smartphone maker wields power over services via its App Store.
The antitrust division is reviewing "whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers," the Justice Department said in a statement.
It added that investigators are "conferring with and seeking information from the public, including industry participants who have direct insight into competition in online platforms, as well as others."
The probe comes after the European Union imposed hefty fines on Google over charges that it abused its dominant position and also launched a formal investigation into online commerce leader Amazon.
"Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands," Assistant Attorney General for the Antitrust Division Makan Delrahim said.
BREAKUPS UNLIKELY
US antitrust enforcers have broad authority over companies and can impose fines for violating antitrust law, impose "structural" remedies to allow for more competition or even break them up.
Some lawmakers including Democratic presidential candidate Elizabeth Warren have been calling for a breakup of major tech firms, saying they are too big and powerful.
Breakups have been ordered only for Standard Oil in 1911 and AT&T in the 1980s, and many analysts say they are unlikely to be applied to Big Tech.
Facebook has argued, for example, that a breakup would not address concerns over its privacy missteps, but rather lead to a number of smaller firms with similar issues.
Analyst Dan Ives of Wedbush Securities said in a research note that breakup orders appear unlikely based on current US law.
"We reiterate our belief that this broader Beltway vs. Big Tech battle is more bark than the bite of broader structural changes across the tech food chain and will likely result in business model tweaks... rather than forced breakups of the underlying businesses," Ives wrote.
"Current antitrust law does not provide for a forced breakup solely due to the size of the business; if it did, Walmart would have been broken up decades ago."
source: news.abs-cbn.com
WASHINGTON -- Executives from Amazon.com Inc, Apple Inc, Facebook Inc and Alphabet's Google will testify before a House of Representatives congressional committee next week in a hearing to discuss the tremendous market power wielded by online platforms.
In a statement on Tuesday, the House Judiciary Committee's antitrust subcommittee said witnesses would include: Adam Cohen, director of economic policy at Google; Nate Sutton, associate general counsel for regulation at Amazon; Facebook's Matt Perault, head of global policy development and Apple vice president for corporate law Kyle Andeer.
The hearing will be held on Tuesday, July 16, the advisory said.
Apple and Google did not respond to a request for comment. Facebook had no immediate comment. Amazon spokeswoman Jodi Seth said they will testify, but did not share details.
Separately, a subcommittee of the Senate judiciary panel said in a notice on Tuesday that it had also scheduled a hearing for July 16. It was not immediately clear who would attend.
The hearings come as the House Judiciary Committee is probing competition in digital markets as part of an investigation announced last month, with both Republicans and Democrats expressing concern about the power exercised by several of the world's most valuable companies.
The executive branch has antitrust probes underway with the Justice Department looking at Google and Apple while the FTC probes Facebook and Amazon.
The hearing also comes at a time when both Republicans and Democrats have expressed exasperation with the big tech giants, but for different reasons.
Conservatives, including US President Donald Trump, have complained that social media companies try to diminish their voices online.
Meanwhile, progressives like presidential candidate Elizabeth Warren have called for Amazon, Google and Facebook to sell companies that they purchased previously as a way to address competition concerns.
Furthermore, Facebook is expected to pay a $5 billion penalty for its work with a consultancy firm Cambridge Analytica, which obtained data from millions of Facebook users without their permission. Cambridge was hired by President Donald Trump for his 2016 US presidential election campaign.
Social media and technology executives have been called to testify before lawmakers in high-profile hearings on various subjects over the past two years, including on foreign influence operations on their platforms.
source: news.abs-cbn.com
WASHINGTON -- The US government is gearing up to investigate whether Amazon, Apple, Facebook and Google misuse their massive market power, sources told Reuters on Monday, setting up what could be an unprecedented, wide-ranging probe of some of the world's largest companies.
The Federal Trade Commission and the Department of Justice, which enforce antitrust laws in the United States, have divided oversight over the 4 companies, two sources said, with Amazon and Facebook under the watch of the FTC, and Apple and Google under the Justice Department.
With jurisdiction established, the next step is for the 2 federal agencies to decide if they want to open formal investigations. Results are not likely to be quick. A previous FTC probe of Google took more than 2 years.
Technology companies face a backlash in the United States and across the world, fueled by concerns among competitors, lawmakers and consumer groups that the firms have too much power and are harming users and business rivals.
Shares of Facebook Inc fell 7.5 percent on Monday while Google's owner Alphabet Inc shed more than 6 percent. Amazon.com Inc shares fell 4.6 percent and Apple Inc dipped 1 percent.
The Justice Department and FTC generally do not discuss investigations.
US President Donald Trump has called for closer scrutiny of social media companies and Google, accusing them of suppressing conservative voices online, without presenting any evidence.
He has repeatedly criticized Amazon for taking advantage of the US Postal Service, also without evidence. Trump has frequently taken aim at Amazon's Chief Executive Jeff Bezos, who privately owns the Washington Post, a newspaper which often criticizes Trump.
LAWMAKERS WEIGH IN
Leading lawmakers on both sides of the aisle welcomed potential investigations of big tech firms.
Senate Judiciary Committee Chairman Lindsey Graham, a Republican, told Reuters that the business model of companies like Google and Facebook needs to be scrutinized. "It’s got so much power, and so unregulated," he said. Another Republican, Senator Marsha Blackburn, said the panel would do what she called a "deeper dive" into big tech companies.
Democratic Senator Richard Blumenthal, who said on Monday that US enforcers have to do more than wring their hands about the companies' clout, also weighed in.
"Their predatory power grabs demand strict & stiff investigation & antitrust action," the Connecticut senator wrote on Twitter.
Separately, the House of Representatives Judiciary Committee opened its own investigation into competition in digital markets, with both Republicans and Democrats expressing concern about the power exercised by tech giants.
News broke on Friday that the Justice Department was laying the groundwork to investigate Google to determine whether the world's biggest online advertising platform was using its size to squeeze out smaller competitors, violating laws designed to ensure fair competition. The company declined comment on Monday.
The Washington Post reported on Saturday that Amazon would come under the remit of the FTC in any probe. Amazon declined comment on Monday.
People briefed on the matter say neither the Justice Department nor the FTC have contacted Google or Amazon about any probes, and that company executives are unaware of what issues regulators are reviewing.
Apple and Facebook did not immediately reply to a request for comment on Monday.
REGULATORY SCRUTINY
While the four technology companies, all worth hundreds of billions of dollars, have drawn scrutiny from regulators and lawmakers around the world, it was not clear what the US Justice Department or FTC planned to focus on.
Amazon, the world's biggest online retailer, has been criticized for holding sway over third-party sellers on its website, who must pay for advertising to compete against first-party and private label sales by Amazon itself. Lawmakers have also argued that Amazon's low prices have hurt brick-and-mortar retailers, many of whom have closed because they could not compete.
Apple is the subject of a European Union investigation into a complaint made by streaming music provider Spotify Technology SA that Apple abuses its power over app downloads. In 2014, the iPhone maker settled a Justice Department lawsuit alleging it conspired with publishers to raise the price of e-books.
The FTC has already been investigating Facebook's sharing of data belonging to 87 million of its users with the now-defunct British political consulting firm Cambridge Analytica. Facebook said in April that it expected to be fined up to $5 billion by the regulator.
Facebook, which owns one-time rivals Instagram and WhatsApp and has more than 1.5 billion daily users, has a huge influence in many countries and has been criticized for allowing misleading posts and so-called 'fake news' on its service.
Google has faced accusations that its web search service, which has become so dominant that it is now a verb, leads consumers to its own products at the cost of competitors.
The FTC settled an investigation of Google in 2013 with a reprimand. The company has been fined multiple times by the European Union's competition regulator, most recently in March for 1.5 billion euro ($1.7 billion) in a case focused on illegal practices in search advertising brokering from 2006 to 2016.
Legal experts have said US regulators are unlikely to attempt to break up the technology giants.
It is rare to break up a company but not unheard of, with Standard Oil and AT&T being 2 of the biggest examples. US antitrust probes more often result in an agreement to change certain business practices.
source: news.abs-cbn.com
WASHINGTON -- The US Supreme Court ruled Monday that a consumer lawsuit accusing Apple of illegally monopolizing the company's App Store may proceed, opening a new avenue of antitrust litigation against the iPhone maker.
In a 5-4 ruling, the justices rejected Apple's argument that consumers lacked standing to proceed with their lawsuit because it was merely an intermediary with app developers.
The class-action lawsuit maintains that Apple, which takes a 30 percent commission on app sales, abuses its monopoly position, resulting in higher prices.
The opinion written by the newest court member, Justice Brett Kavanaugh, said consumers had a right to pursue their case because they have a direct relationship with Apple.
"If a retailer has engaged in unlawful monopolistic conduct that has caused consumers to pay higher-than-competitive prices, it does not matter how the retailer structured its relationship with an upstream manufacturer or supplier," the opinion said.
Kavanaugh was joined by liberal justices Ruth Ginsburg, Elena Kagan, Stephen Breyer and Sonia Sotomayor.
A dissenting opinion written by Justice Neil Gorsuch and joined by other conservatives on the court agreed with Apple's argument that developers, not the company, sell to consumers and that the lawsuit is based on "pass-on" liability.
"The problem is that the 30 percent commission falls initially on the developers," Gorsuch wrote.
"So if the commission is in fact a monopolistic overcharge, the developers are the parties who are directly injured by it. Plaintiffs can be injured only if the developers are able and choose to pass on the overcharge to them in the form of higher app prices that the developers alone control."
Apple's online marketplace is the sole avenue for apps for its iPhone and other mobile devices, and the company has paid out more than $100 billion to developers since launching the store a decade ago.
Apple did not immediately respond to an AFP query on the decision.
source: news.abs-cbn.com
PARIS -- France is pushing blockchain technology as a means of preventing finance giants enjoying a monopoly on transactions, Finance Minister Bruno Le Maire said Monday.
"Blockchain protocols are a game changer," Le Maire said at "Paris Blockchain week," a flagship symposium attended by experts in the technology which originally came to prominence as the digital infrastructure for cryptocurrency bitcoin.
"Thanks to blockchain protocols users have the possibility of creating and running their own networks for money transfers, trade and services without intermediation from any platform" he said.
France had already put in place legal, fiscal and accounting structures to manage fundraising in digital currencies as a pillar of the blockchain economy, he said.
Le Maire said he would ask France's EU partners to consider "a French-inspired single (European) regulatory framework (governing) crypto assets".
Paris earlier this year drew up a roadmap to regulate and implement investment in the blockchain ecosystem with a view to becoming a global leader in the technology.
Supporters say the technology creates a comprehensive ledger of transactions which cannot be falsified.
They say the technology could revolutionize the global economy by allowing, for example, financial transactions which bypass financial intermediaries and even the use of 'fiat' money.
A recent slump in the market value of cryptocurrencies, not least standard-bearer bitcoin, after 2017's meteoric rise has doused enthusiasm.
But the expanding rollout of blockchain has seen it largely ride out the storm.
The chairman of France's financial markets' regulator (AMF), Robert Ophele, meanwhile told the conference Paris will shortly allow fundraising for digital currency offerings after drawing up a legal framework for coin offerings, a means for firms to raise money by offering digital coins or tokens to the public.
"We think we shall be ready in September to receive the first dossiers and deliver the first permits," Ophele said, adding he is open to the placing of financial assets on the blockchain to facilitate their exchange.
Blockchain "is quicker," "costs much less," and has a global footprint," Ophele said.
One sector which could benefit from the speeding up of transactions is the transfer of real estate title, he said.
"If it is well done ... it could go through quicker than the transitional two or three days" from market transaction to actual transfer of title.
source: news.abs-cbn.com
WASHINGTON -- The US Supreme Court agreed Monday to hear a case on whether Apple can be sued under antitrust law for monopolizing the distribution of mobile applications on its App Store.
The case which could have important implications for Apple and its mobile ecosystem hinges on whether the iPhone maker has a right to have a "closed" system where only the company can distribute mobile apps.
In the lawsuit filed by buyers of iPhones and iOS apps claimed Apple's monopoly leads to inflated prices and that consumers should be able to purchase the applications from outside parties without Apple's 30 percent service charge.
A lower court dismissed the complaint, but an appellate panel reversed the decision and said the lawsuit court proceed.
The high court thus accepted Apple's appeal and will rule on whether the case can go to trial.
The Justice Department backed Apple's position in the case, which will be heard by the justices later this year.
Apple said in its brief that the case "presents issues of national importance given the increasing prevalence of electronic commerce and the agency sales model."
The case could impact the multibillion-dollar app ecosystem, and efforts by companies like Apple to establish a so-called "walled garden" for software on their devices.
In the case which dates back to an original lawsuit filed in 2011, a California appeals court ruled last year that Apple could be sued because the company rather than developers was selling apps to consumers.
source: news.abs-cbn.com
