US President Joe Biden has issued an executive order aimed at fostering competition on the US market, and with the ultimate goal of hindering accelerating corporate consolidation and so lowering prices, increasing wages and promoting innovation continued economic growth. The “whole-of-government” order includes 72 initiatives touching on labour markets, healthcare, transportation, agriculture, banking and consumer finance, internet service and technology.
The order seeks to increase mobility, enforce antitrust laws and challenge prior bad mergers. To achieve its goals, the White House has created a new Competition Council, led by the director of the National Economic Council, to monitor progress on finalizing the initiatives and to coordinate the federal government’s response to what it calls the “rising power of large corporations in the economy.”
Regarding internet services, the order will tackle a number of issues that limit competition, raise prices and reduce choices, namely, the lack of competition among broadband providers and the lack of price transparency; excessive early termination fees; and companies discriminatorily slowing down internet access. Biden is also encouraging the FCC to restore net neutrality rules.
Specifically, the order wants the FCC to prevent ISPs from making deals with landlords that limit tenant choice. To push price transparency, the order asks the FCC to revive the “Broadband Nutrition Label” under planning under the Obama administration and dropped by the Trump administration. The simple label would provide basic information about the internet service on offer so that people can compare options. It also asks the FCC to make providers report prices and subscription rates the commission. The President also encourages the FCC to limit excessive early termination fees.
Regarding technology, the order wants to address three ways dominant tech firms are undermining competition and reducing innovation. To stop big tech platforms from buying up would-be competitors, the President said his administration will look more closely at mergers, especially by dominant internet platforms, with particular attention to the acquisition of ‘young’ or startup competitors. The administration will also scrutinize serial mergers, the accumulation of data, competition by “free” products, and the effect on user privacy.
Secondly, the order wants to stop big tech platforms from gathering too much personal information. To that end, the President said he “encourages” the FTC to establish rules on surveillance and the accumulation of data.
Lastly, to stop big tech platforms from unfairly competing with small businesses, FTC is, again, encouraged to establish rules barring unfair methods of competition on internet marketplaces. The order also says the FTC should issue rules against anticompetitive restrictions on the use of independent repair shops, or for doing DIY repairs on one’s own device or equipment.
Diverse reactions to order
Many public interest groups expressed satisfaction with the executive order, though some did express some reservations.
The Consumer Technology Association (CTA) said while it it “appreciates” the administration’s focus on competition, it noted that the tech industry is already competitive, domestically and globally. The association said it was concerned about the increased scrutiny on business mergers, even those that were completed years ago. “This strays well beyond legitimate government guardrails and threatens our ability to innovate. Countless startups launch with the goal of being acquired by a large company, a process that allows big ideas to become marketplace realities. Prohibiting these acquisitions will dry up venture capital, harm entrepreneurs and small businesses and make our economy less competitive.”
"A government effort presuming ‘big is bad’ or trying to pick marketplace winners and losers will reduce innovation, cost our nation countless jobs and upend the savings and retirement plans of millions of Americans. Not all challenges are solved with new rules - and streamlining or eliminating unnecessary rules can foster greater competition and economic growth. We will continue to work with the administration and Congress on ways to enable innovation and competition, rather than thoughtlessly stifle it at every turn,” CTA said.
The Telecommunications Industry Association (TIA) said the order is “circling back to the same issues from a decade ago.“ The association said this was disappointing given the levels of private investment made in recent years that directly resulted in more flexible broadband networks. The TIA said that while it shares the same goal as policymakers to have broadband connectivity available to every home in the US, it looked forward to “creative policy solutions” and not into the past.
Incompas said it was pleased President Joe Biden was taking action to stop broadband monopolies in apartment buildings and condo complexes, where 30 percent of people live. The group also said it welcomed additional scrutiny on the practives of large ISPs’, as these l”egacy market power continues to squeeze competition and increase prices for consumers and business customers large and small. Competition and open internet policies create more opportunities for start-ups and small businesses eager to bring new ideas to global markets.”
