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Internal Emails Shed Light on Big Tech’s Abusive Business Practices

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LUCAS NOLAN

7 Aug 20200

4:13

A recent report from NBC outlines what a huge number of emails from tech giants Amazon, Apple, Facebook, and Google could mean for possible antitrust cases against the companies.

NBC New York writes in an article titled “What a Trove of Emails From Facebook, Amazon, Apple and Google Could Mean for Potential Antitrust Cases,” that following the recent testimony of the CEO’s of Amazon, Apple, Facebook, and Google, internal emails obtained by Congress as part of an antitrust probe into the firms provide even further insight into the operations of the tech giants.

A curated selection of 1.3 million internal documents released by the House Judiciary Committee’s antitrust panel are part of a year-long investigation into the tech firms and include emails and chat logs between executives at the firms.

The documents reportedly show the companies strategizing ahead of major company decisions, such as Facebook’s $1 billion acquisition of Instagram or Amazon’s decision to undercut the price of diapers to compete with Diapers.com.

Alicia Batts, a partner in the antitrust and competition practice at Squire Patton Boggs, commented that its not uncommon for these sort of documents to surface in a merger investigation. “It’s an indication to look deeper but not necessarily an indication you won’t be able to close [the deal],” she said in an interview with CNBC. “When you have both documents that show a company is planning to harm competition and the economic data or the economic model support that it’s possible, that’s when the documents are given the most weight.”

NBC outlined some of the most interesting revelations from the documents relating to each of the companies, several of which can be found below:

Facebook

– Instagram co-founder Kevin Systrom feared Zuckerberg entering “destroy mode” if he didn’t sell: As Zuckerberg began to court Instagram for a potential deal, Systrom messaged one of his investors, Benchmark Partner Matt Cohler, in February 2012 for advice on how to politely rebuff an offer. Systrom seemed adamant in wanting to stay independent to see how far he could take Instagram on his own. But he wanted Cohler’s advice on whether Zuckerberg would “go into destroy mode” if he rejected an offer.

″[P]robably,” Cohler responded, ”(and probably if we just don’t engage at all).”

 

Amazon

– Amazon undercut Diapers.com’s prices before buying it:A top executive, then-vice president of worldwide corporate development Douglas Booms, identified Diapers.com as Amazon’s ”#1 short term competitor” in a 2009 email. “As I’ve mentioned to each of you, I think, we need to match pricing on these guys no matter what the cost,” Booms wrote.

 

Apple

Apple argued to Congress that it “treats every developer the same,” and that “the rules apply to everyone.” But its internal messages show otherwise. As previously reported by Breitbart News, Apple offered a sweetheart deal to Amazon to get its Amazon Prime Video app on Apple Devices. The proposed deal included Apple charging a far lower percentage to Amazon than to typical app developers.

 

 

Google

– Executives saw a potential deal with YouTube as a way to prevent Yahoo from buying it: As Google executives pondered whether to buy YouTube, one key consideration appeared to be thwarting Yahoo from snatching up the video service.

Huber, the SVP of geo and commerce at the time, wrote in a 2005 email, “I think we should talk to them, if nothing else to make it more expensive for Yahoo. They’ll also eventually need a monetization/ads model, so we should use ours instead of anything from Yahoo (if they don’t go acquisition soon, and we maintain reasonable relations with them).”

 

Read more at NBC New York here.

Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or contact via secure email at the address lucasnolan@protonmail.com

Columbia Prof Tim Wu: Big Tech’s Real Business Model Can Be Found in Its Emails

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LUCAS NOLAN

6 Aug 202091

3:40

As tech giants Amazon, Apple, Facebook, and Google are investigated by Congress over antitrust allegations, troves of internal company emails reveal how these companies rose to the top and provide compelling evidence that they violated antitrust laws. Columbia Law School professor Tim Wu believes that the Masters of the Universe have built a business model on buying the competition, and destroying those that will not sell.

In a recent article for the New York Times, Columbia Law School professor Tim Wu outlines some of the key pieces of information gained from internal emails from Apple, Google, Facebook, and Amazon as the companies face a rigorous antitrust investigation by Congress. The documents details how the companies, Facebook and Amazon in particular, may have violated antitrust laws while becoming market leaders in their fields.

The Times article notes internal emails from Facebook which appear to show that Facebook had a common tactic to “control” smaller companies that posed a threat to the social media giant.

Wu writes:

Exhibit A is Facebook, whose documents are the most damning. Emails from Mark Zuckerberg, its chief executive, strongly suggest that since about 2008 he has had a method for controlling what in a 2012 email he called “nascent” companies that posed “very disruptive” threats to Facebook. His method has been the buyout or the aggressive cloning of features to compel a company to sell itself to Facebook. He foresaw that there would be a limited number of “social mechanics,” or areas of innovation in social media, each of which would have one winner. “Instagram can hurt us,” he wrote in 2012, right before acquiring the company and eliminating the threat that its photo- and video-sharing technology posed to Facebook.

Amazon similarly outlined how the company addresses competition and its aggressive approach to rivals:

Amazon doesn’t come off much better. Its documents show an apparent willingness to lose money to keep competitors under water. Early on, because of low pricing, Amazon lost more than $200 million from diaper products in a single month. It ran its chief competitor, Quidsi, into the ground. (Quidsi owned Diapers.com.) Then Amazon bought the weakened company. This approach, like Facebook’s acquiring of competitors, is how John D. Rockefeller built up Standard Oil in the 1870s. It’s “join us — or face extermination.” Likewise, Amazon has admitted to sometimes selling its smart speaker, Echo, below cost, presumably on the theory that collecting huge amounts of data on users and securing direct access to their homes will present an insurmountable barrier to potential rivals.

Internal emails from Google appear to show that the company actually had very little interest in the video-sharing platform YouTube but chose to purchase it simply out of fear that it would threaten the company’s monopoly on search. Google bought YouTube for $16.5 billion in 2006. All of this appears to show a pattern of big tech firms simply buying away their problems.

Wu notes that while the recent antitrust subcommittee hearings are a good step in the right direction, concrete action must be taken to prevent these Silicon Valley tech firms from continuing to operate monopolies in the world of Big Tech.

Read more at the New York Times here.

Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or contact via secure email at the address lucasnolan@protonmai