Amazon, Facebook, Alphabet and Apple will trumpet their credentials as all-American success stories to counter claims they unfairly stifle competition, as their chief executives face a grilling in Congress on Wednesday.

Making his first appearance before lawmakers, Jeff Bezos, the founder of Amazon, will stress the ecommerce company’s role as one of the largest US employers and a driver of growth for small and medium-sized businesses across the country, according to prepared testimony released ahead of the hearing.

“To fulfil our promises to customers in this country, we need American workers to get products to American customers,” Mr Bezos will say.

Mr Bezos will be joined by Facebook chief executive Mark Zuckerberg, Apple’s Tim Cook and Sundar Pichai, chief executive of Google’s parent company Alphabet, before a House of Representatives committee to answer lawmakers’ questions — though all four will be appearing remotely due to efforts to limit the spread of coronavirus. The hearing is the latest and most public stage of an investigation into the market power of big internet platforms.

Mr Bezos will argue Amazon’s platform is used by almost 2m small businesses, which collectively make up about 60 per cent of physical product sales on Amazon, and insist that the company only plays a small part in the overall retail sector. It has a market share of roughly 4 per cent in the US, it points out.

Critics say such a comparison is disingenuous because Amazon’s share of ecommerce is much higher at about 40 per cent. To this, Mr Bezos will talk up the recent growth of rivals such as Shopify and Instacart.

READ ALSO  Wells Fargo Reverses Course On Ending 401(k) Match After "Swift Backlash" From Affected Employees

He will tell lawmakers: “Customers are increasingly flocking to services invented by other stores that Amazon still can’t match at the scale of other large companies, like kerbside pick-up and in-store returns.”

Apple’s Mr Cook will describe his company as “uniquely American”, before going on to defend its role as gatekeeper to the lucrative App Store, through which it is accused of setting onerous commission fees and favouring its own apps.

Mr Cook will tout the store as an “economic miracle” that has grown from 500 apps in 2008 to 1.7m today, driving more than half a trillion dollars in ecommerce worldwide in 2019.

“If Apple is a gatekeeper,” his testimony reads, “what we have done is open the gate wider.”

On the success of the iPhone itself, Apple’s chief executive will point out that users can choose from a host of other handset makers in the “fiercely competitive” smartphone market. Samsung and Huawei, for instance, each had a higher global market share in 2019 according to Canalys. 

Alphabet’s Mr Pichai will push a similar argument of growing competition, in his case regarding Google’s position as the leading search engine. He will cite voice search — through devices such as Amazon’s Alexa — as providing consumers an alternative.

“You can ask Alexa a question from your kitchen; read your news on Twitter; ask friends for information via WhatsApp; and get recommendations on Snapchat or Pinterest,” his written testimony reads.

“When searching for products online, you may be visiting Amazon, eBay, Walmart or any one of a number of ecommerce providers, where most online shopping queries happen.”

READ ALSO  2 UK shares I’d buy in November

In keeping with the appeal to lawmakers’ patriotism, the Alphabet chief is also expected to talk up Google’s work with small American enterprise.

“I am deeply proud that because of our tools, businesses on main street can compete in a way that wasn’t possible 20 years ago,” Mr Pichai is expected to say.

At the same hearing, Mr Zuckerberg will describe Facebook as a “proudly American company” and a bulwark against the rising threat posed by Chinese technology.

According to his written testimony, the social media group’s chief will say that stifling innovation and competition in the US could boost China, whose censorship practices are at odds with the values of “democracy, competition, inclusion and free expression” adhered to by his company.

“Many other tech companies share these values, but there’s no guarantee our values will win out,” Mr Zuckerberg will say. “For example, China is building its own version of the internet focused on very different ideas, and they are exporting their vision to other countries.”

The Trump administration has taken an increasingly hostile stance against Beijing, including making threats to ban TikTok, a Chinese-owned rival to Facebook that has exploded in popularity during the pandemic. 

On Wednesday Mr Zuckerberg will also defend his company’s acquisitions of the social network Instagram and the messaging group WhatsApp, which critics argued were an attempt to quash growing rivals. Both platforms benefited from Facebook’s existing technology and infrastructure, including its ad sales products and systems, while using its resources to “tackle spam and hateful content”, he will say.

READ ALSO  How our cities changed when the tourists stopped coming

While the hearing is meant to be focused on competition issues, Republicans have vowed to press the companies on issues of free speech and censorship, particularly when it comes to conservative voices. Democrats have also raised concerns about whether the platforms are doing enough to stamp out hate speech and false information.

Via Financial Times