×
You will be redirected back to your article in seconds

DOJ Announces Antitrust Review of Tech Giants

In a move that could potentially disrupt Silicon Valley’s biggest companies, the U.S. Justice Department announced that its antitrust division opened a review into “whether and how market-leading online platforms have achieved market power.”

The DOJ, in its announcement Tuesday, didn’t identify which companies it is looking into as part of the investigation. Facebook, Amazon, Google and Apple are the biggest and most powerful companies in the sector.

It’s the latest political shot across the bow against the tech industry, which has gained critics across the ideological spectrum.

“Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands,” Assistant Attorney General Makan Delrahim of the DOJ’s Antitrust Division said in a statement. “The Department’s antitrust review will explore these important issues.”

Delrahim led the DOJ’s unsuccessful lawsuit to block the AT&T-Time Warner merger.

In the past few months, media outlets reported that the DOJ and Federal Trade Commission were considering launching antitrust probes into large tech companies.

The DOJ on Tuesday said its inquiry was prompted by “widespread concerns” among consumers and businesses about “search, social media, and some retail services online.” According to the Justice Department, the probe will include an examination into whether the companies are “engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers.”

The DOJ’s antitrust division is seeking information from the public, including industry participants “who have direct insight into competition in online platforms.” The agency said that if its investigation determines that companies have broken the law are identified, it “will proceed appropriately to seek redress.”

Shares of Alphabet (Google’s parent company), Amazon, Apple and Facebook fell in after-hours trading after the Wall Street Journal reported the DOJ’s investigation prior to the official announcement.

The chance the DOJ’s investigation will lead to the breakup of any of the companies is unlikely, but the probe does introduce some near-term uncertainty for the sector, according to Wedbush Securities analyst Dan Ives.

“We ultimately believe this is more noise vs. the start of broader structural changes across the tech food chain and will likely result in business model tweaks and potential DOJ/FTC fines in a worst-case scenario rather than forced breakups of the underlying businesses,” Ives wrote in a note to investors.

Earlier this month, the FTC reportedly voted to fine Facebook around $5 billion for privacy-rules violation. The agency had been probing whether the social-media giant broke the conditions of its 2012 agreement with the FTC after Facebook user data was obtained by now-defunct consulting firm Cambridge Analytica.

The Beltway backlash against tech giants has included calls by Democratic presidential candidates Elizabeth Warren and Bernie Sanders to dismantle huge tech companies, while Republicans including Donald Trump have focused on a perceived political bias in how platforms like Facebook and Google moderate and rank content.

Popular on Variety

More Digital

  • Amazon Music Free

    Amazon Music Expands Access to Free Streaming Service, Spotify Stock Falls

    The free version of Amazon’s music-streaming service is now available across more platforms, bolstering competition with Spotify’s free tier. Starting Monday, Amazon said, customers now listen to Amazon Music’s ad-supported selection of top playlists and thousands of stations for free. It’s available to anyone in the U.S., U.K. and Germany who doesn’t have a Prime [...]

  • John T. Stankey WarnerMedia CEO

    WarnerMedia CEO John Stankey on Early Disney Plus Success: 'Good for Them'

    WarnerMedia CEO John Stankey told the audience of Recode’s Code Media conference in Los Angeles Monday that Disney “did a good job” with Disney Plus, which announced that it reached 10 million sign-ups the day after the service’s launch. “Good for them,” Stankey said. “They are off to a good start.” However, he also cautioned [...]

  • Google Stadia

    Google Stadia Reviews: Game-Streaming Service Not Ready for Primetime

    The first takes on Google Stadia, the internet giant’s new game-streaming service that debuts Nov. 19, are out. And the consensus is that Stadia is needed more time in the oven before it was served up to the gaming crowd. Google’s big promise with Stadia is that players can access top-tier game titles without a [...]

  • 60 Minutes" reporter Lara Logan takes

    Lara Logan Will Host Fox Nation Documentary Series

    Lara Logan made a name for herself by reporting from global trouble spots for CBS News. Soon, she will be holding forth on a four-part docuseries for Fox Nation, the Fox News streaming-video service. Logan will present “No Agenda,” which will debut in January on Fox Nation, and is produced by Warm Springs Productions. She [...]

  • warnermedia lab hires

    WarnerMedia Hires Jeremy Toeman, Matthew Davis as Innovation Lab Execs (EXCLUSIVE)

    WarnerMedia is building out the leadership of its Innovation Lab: The AT&T-owned media company has hired Jeremy Toeman as vice president, technology and product, and Matthew Davis as vice president, creative. Both will be based in New York and report to WarnerMedia executive vice president Jesse Redniss, who is also the general manager of the [...]

  • ABC News Live LG

    Xumo Adds ABC News Live Just In Time for the 2020 Election

    Ad-supported streaming video service Xumo is doubling down on news: Xumo is adding ABC News Live to both its owned-and-operated apps as well as to white-labeled services like LG’s Channels video app in the U.S. and Canada. With Aermicans glued to their TVs for the impeachment hearings, and the 2020 election fast approaching, the launch [...]

  • Displayland

    AR Startup Ubiquity6 Launches Displayland, an Instagram for Photogrammetry

    San Francisco-based augmented reality (AR) startup Ubiquity6 publicly launched its Displayland mobile app for iOS and Android Monday, giving everyone the ability to capture objects and places in 3D and share those 3D assets with the app’s other users. The public release follows several months of private beta-testing, and comes ahead of plans to turn [...]

More From Our Brands

Access exclusive content