 Hello and welcome to news click today. We're going to be talking about the depositions of the heads of four tech companies That's Amazon Facebook Google and Apple in front of the US House of Representatives committee on antitrust Now these four tech heads were called to answer questions by legislators both Democratic and Republican The law main focus there was a variety of questions actually But the main focus were whether these companies were too big whether these companies were not Allowing competitors to grow and suppressing competition whether they were having a larger dangerous effect on democracy itself So to talk more about this we have with us probably Prakash sir probably thank you for joining us So to begin with Could you talk about maybe what was the larger sense that came out of these hearings because we do know that each of these companies has been Questioned and especially in recent years for many practices which can be called harmful Which can be called unethical and these people are of these men are also the richest in the world So where do we see these hearings going? Well, it's interesting. These are called the gaffa the google apple Facebook amazon These as you said are the four biggest tech companies in the world along with microsoft Which incidentally wasn't here which is as big a monopolist as the other four But microsoft has come under the scanner earlier It had criticisms of different kinds. So this time I guess the other four were the doc the It's an interesting issue because we are again hearing about monopolies in the united states After quite some time, you know the Earlier bunch of anti monopoly issues that had come up came up really at the end of the 19th century And that continued for quite some 30 40 years Breaking up the oil companies Last big anti monopoly action was really breaking up the bell monopoly And after that we haven't heard any talk about monopolies in the united states The sudden rise of the tech monopolies over the last 10 12 years has really flagged this particular Act set of actions actions at the moment in terms of congressional congressional hearings The interesting part is the the reference Repeatedly made to justice brandis who did talk about the incompatibility of monopolies and democracy And said you can either have monopoly monopoly power or you can have democracy you can't have both Now the united states has believed that the good of as it was to be called general mortars in those days Who which was the leading monopoly general mortars was good of good for united states Now we can say good. What is good for garfa is good for united states Was possibly the philosophy for some time and interestingly enough it has rubbed the political established establishment differently And this monopoly hearings is part of it monopoly Which i think a number of people are worried about which has been a consistent criticism A part of it is also political posturing coming from russia hacked our elections to Trump basically Hacking the elections with different support of the of the of putin as well as the fact that a lot of conservative opinion Including even trumps and trumps sons the sub twitter Actually exercising what would be called censorship on them now? This is also the obverse of the other part of it Which is monopoly and they are saying that you're exercising monopoly power to curb our speech Or you're not giving us a free hearing So that brings up the issue of hate speech versus what is fair speech and that's a different ball game altogether And i would say that if monopolies emerge Then of course you have an issue Who does the censorship because you cannot accept that There is no bar on quote unquote free speech to the extent of all kinds of things being said incendiary violence being Roused and so on so particularly with lynchings we have seen in the country I think this is a completely untenable position anywhere in the world But there is a strong opinion that the u.s. That we should be allowed to do anything on As far as speech is concerned and all of this is free speech So it really had two very different elements coming together And that's why the four were on the dock and if it was monopoly power Then five should have been on the dock and therefore the fact that microsoft wasn't also meant that it was Conflated with other issues coming to the key issue that you're raising the issue of monopoly And the exercise of monopoly power I think is also Clear from what the documents that were apparently presented to the congressional hearing members As well as what's come in the public domain from in other context research not necessarily in this that This monopoly power extracts at least a 30% rent on their platforms This 30% rent is what amazon extracts from the people who Supply products through amazon it has led to bankruptcies down the line, but amazon has a infinite supply of new players who come Hoping that they will not face the same consequence And therefore they are not really too bothered about the fact that the bankruptcies of amazon partners are taking place Continuously so the 30% seems to be the figure that is emerged and as somebody has said I pay 20% Tax to uncle sam 30% tax to amazon Now interestingly 30% is also the figure that came out from the hearings, which some people said the apple apps those who Use the or give their apps to apple and earned earnings from that. They also play pay a fat Flat 30% rate to apple So the tax is for both are 30% on whoever supplies through their platform So this is the monopoly power the assert now there are other ways There are certain powers which i'm not getting into But it's a classic issue of you're a monopolist to those whom you from whom you buy You're a monopolist to those whom you supply So this is the double-sided monopoly which in amazon or apple in the case of the app stores that it has Obviously uses but let's come to the bigger issue for me that these companies are not just local monopolies They're not us monopolies the really global monopolies and rest of the globe doesn't seem to have any power to control them There are also companies which are not officially headquartered headquartered for tax reasons in the us They are in caiman islands or some such tax havens So they pay very little income tax to the us government So they are us companies for all you know, whatever the fiction They might maintain the really us companies and they have all attended the us congressional hearings So they haven't said hey, we're not us companies. Why should we come before you? So the issue is that any country which has summoned them and india has in fact, if you remember india had Someone zuckaburk who refused to come and though Our telecom minister issued some threats at that time. He seems to also have forgotten about it Ravishankar Prasad said india government of india is calling you but I don't think he later on remembered what he had himself said So it's the fact that they did appear before the us congressional hearings. These are us companies. That's an admission So rest of the globe doesn't seem to have any role in this now. There are committee hearings or there are various antitrust hearings, which I've been using the us word But basically various regulatory agencies have taken up the issue starting from australia to europe about the monopoly power They exercise so this is a very real issue How do you prevent this monopoly power in different parts of the world from being exercised? And how do you protect your local market from what essentially are american companies? This I think is a second issue that we have to really think about The third is how is this monopoly power being exercised and it's very interesting because when the internet started It was people were connecting directly to each other and we thought that the main monopoly power of media Which meant that you had to go for news or for television or for even cinema You went to a few established players. They had the monopoly that this monopoly therefore allowed them to extract monopoly rent from others and if we are directly able to talk to each other And we are able to directly convey news to each other in groups in the smaller More shall disparate markets so to say not controlled by centralized conglomerates Then we would get a much more democratization of the media news What instead happened is this entire set of companies that sprung up and google of course was the first big one They centralized this entire internet. So we don't connect to each other directly. We connect to google I give a google gmail to you you Do you know you write back on gmail? We are not connecting to each other as we did originally but we are connecting to google So what has happened is a whole infrastructure of facebook google has been built up by which they control from both sides They control what you do what you see or how you write to whom you write All that information of course is as we know data is also money But more than that what has happened is they are In the middle and what we think is the internet is really google and facebook increasingly In fact 70 percent of the internet traffic today is google and facebook So this is the centralization of the net and this is the centralization which is not a single country Earlier media telecommunications were monopolies, but monopolies in their countries Now we have got an entirely a global monopoly in which four five six companies completely ruin the roost So we have really got Centralization and creation of monopolies on a scale that we have never faced before and it's really last 15 20 years that we have seen this develop. I think this is the much bigger threat These are international monopolies Control at one side by the united states back by the united states if anything happens In fact even in india is the us embassy takes an interest and also intervenes in these issues And therefore these are not companies which are without the blessings and the protection of the united states Even if the united states congressional hearings are all these companies as well So this is the centralization of monopoly power. These companies are really Asserting and you can see that the rate of profit, which is really the monopoly rent They're extracting by building these technology Logical, you know methods of monopolization today means that they have a profit margin far beyond what any other company has And they are able to leverage this into newer and newer fields Which is the google example and which promula jai pal one of the congressional Members of the committee said that you know, why is it when you do a google search? You go to google sites rather than to other sites. So this is an obvious issue How do you misuse your position on the on search engine to directing people to sign? Sites and so on So whatever it says that this is the reality that technology has built New monopolies on the scale we haven't seen before and this is not the oil monopoly Not the telecom monopoly. This is far more pervasive Than what we have seen so far and the solution does not lie in hearings and talks and you know Stacks increases and so on but being able to break up the monopolies. There is no other answer Either nationalize or break them. These are the only two ways to go and if countries like india have to face it It has to see how to protect this internal market. This is what china has done people think china The great firewall of china is about censorship. No, it is not it is about building an internet Which is free from these companies and that's why the fifth largest sixth largest company in the world today is Chinese one it's alibaba So in fact, that's how they have become strong because they have a home market in which they could play And then you have 10 cents. You have a couple of others So you see that apart from china There's nobody else who's protected the internal market may be partially russia And we have decided as of now to ban all chinese companies virtually for playing an indian market But we have opened ourselves completely to the american countries and they believe that that's the alliance we need But that's as the amazon and others now balance sheets clearly show that this is a completely one sided alliance We don't really get benefits from it. And what you do is really surrendering your internal market to this company And praveen has a follow-up question just to sort of elaborate on the idea of breaking it up itself So there's been a lot of talk about it, especially over the past decade or so Once the snowden revelations came out about the kind of backdoors the u.s. Government had on this Once the cambridge analytica issue came out again. There was a huge furor In fact, even in these hearings Congress persons did ask about how what happens when google becomes your gateway to the internet but How does actually breaking these companies up look like both in terms of the legal frameworks that are required and the final Technological framework that may emerge because often the argument posed is that These companies are so big so they're able to you know, provide this bouquet of services Which would not be available to people otherwise You know monopolies have always given these kind of arguments. We have economies of Scale we can do a we can do b Not completely untrue. That's why they are monopolies But the point is that they also Stifle a whole bunch of other technological revolutions Improvement that can take place and also crush all Descent they can crush all other companies with the serious competition, but more importantly Politically they in fact work to see that the american viewpoint globally is the viewpoint that is presented So as if you go and search, you know, mandela was Arrested because by the south african police because The upper side south african police will remember Because the american embassy informed on him that they had wanted to meet with him to talk to him And they also then informed south african police. Hey, he's in town, you know, so you can arrest him He's probably here. So these are the things that you won't find if you do google search You will find a lot. I mean, it's not that it is completely erased out of memory But you will find it's hidden away under so many Other queries that you get mandela is this Nonviolent apostle of peace mandela did Going for arm revolution. So that he supported arm revolution. He was very much a part of it So all those things are then airbrushed out of history If you do google search, you have to go to 10th 11th 12th page of google to see this Now this is political power which is being asserted and of course it is with With partnership with and in collaboration with the united states Agency it's not happening innocently though, you know, people would like to believe that it is so So this is political power. So I think there are two sets of issues here One is how do other countries protect their home market against predatory players like google Now that's one set of issues that we have to take up. Do you promote our own search engine? Do we also see that google search engine does is not allowed to be used in india for instance, should you be so harsh Do we then if we are reacting as a country, what do we then do? These are questions we have to really look at and at the same time If it is the us which has to look at all this us has to basically look at the fact how to break up google That's the key issue in front of these companies. How to break up their different businesses For instance bell when it was the Telecom company it wasn't allowed to enter the whole range of business in in fact It had 32 bit chips before anybody else. They had 32 bit technology at the time really path breaking But they couldn't enter the computer market for instance. That's why you see a whole range of Bell products From software to other things were available free because they had to give that away if they had a telecom monopoly In fact, one of the reasons they were willing to give up the telecom monopoly They thought that they could enter other areas and make money out of it So you those are the kind of things that you have to say if you want to be search engine You just do this and nothing else all other activities have to be hyped up. You can't enter So all those kind of things have to be done But it's not an easy one because between media search engine media social networks The connection has become so intimate that that's not going to be so easy either The other alternative is to break them up as independent companies like it was done with bell labs And you've got different companies doing different business different areas in this case different businesses Will that succeed? I don't know But these are some of the issues that that will have to be looked at But the most important one in terms of an approach would be to declare these are public Utilities and if they're public utilities, there are certain rules They have to follow including a fixed rate of profit not more than that 2% profit 3% profit. That's it So there are various ways of regulating But all of it needs a political will and at the moment the political will is to bend facebook and google To trumps viewpoints. So to say don't censor us Don't do this. Don't do that. But not raising the key issue How are you a monopoly does monopoly itself affect what you do to others? And how do we break monopoly power though? It has come up in the congressional hearing justice brandis who talked about democracy and monopoly being incompatible Has been quoted enough number of times by the congressional committee. So, you know, there is hope yet But looking at the larger american politics, this doesn't seem to be immediately in the offering and it's also interesting that COVID-19 has really increased the monopoly power Of this digital monopoly The digital monopolies have never had it so good as they have had during the COVID-19 epidemic Because you can see their stock rates which have gone up. You can see the stock market They have done exceedingly well and it's not surprising because online deliveries have increased people have gone much more on the net So, you know amazon prime to others are all making money out of it So you have a whole range of things which have because of the kind of physical lockdown issues that have come which have helped them But at the same time the political centralization As well as the economic centralization of power of these companies and I would think that, you know, microsoft is A very important player in this has to be looked at and you know, finally prashant Key issue is really technology That you know, these monopolies have been come by clever, uh, you know, uh, entrepreneurship They have come because technology new technological frontiers have opened up the internet And somebody had to emerge and these companies then got a global stage to emerge And therefore they have become really global players because the internet is a global space And I think that is the key issue that technologies will always create the opportunities for new monopolies And unless you are able to break up monopoly power politically to political action You cannot break break it up by just talking about it And I think that is the crux of the issue we are facing today And the fact that different regulators are talking about it I think there's a worldwide acceptance now that this is not simply an american issue European issue australian and indian issue is a global issue And we need at the end of it Something which will allow us to tackle it globally as well as locally. Thank you very much for talking to us That's all we have time for today. Keep watching music