Amazon and Google deploy their armies to thwart antitrust bills
The antitrust bills’ supporters accuse the tech giants of spreading baseless fears and stoking small businesses’ anxieties to blunt the growing anti-monopoly momentum in Congress. But the effort shows that the companies’ networks of data centers, warehouses, business partnerships and legions of users have given Amazon and Google a huge number of potential allies in their showdown with Washington.
“I’m glad in this case Amazon is deploying people like me,” said Kristin Rae, the founder of Inspire Travel Luggage, a vendor that sells its wares mostly on Amazon. “Because maybe we are the ones who can get through to lawmakers and say, ‘Wow, my job or position or brand could be in danger.’”
Rae, who has appeared in Amazon blog posts and videos about the small businesses and female entrepreneurs who use its marketplace, said she is especially concerned about bills like one from Sens. Amy Klobuchar (D-Minn.) and Chuck Grassley (R-Iowa) that would prohibit big companies from unfairly favoring their own products on their online markets. Amazon has said this legislation could force the company to shut down its third-party marketplace.
Supporters say the bill, S. 2992 (117), is meant to protect small vendors like Rae, pointing to a litany of complaints about dominant platform providers such as Amazon and Apple. But Rae argued that by denting Amazon’s business model, the bill would harm her own economic lifeline.
“It was like it was written by somebody who didn’t understand e-commerce,” she said.
After learning about the bill from an email alert that Amazon had sent to its 2 million retail, creative and tech partners, Rae reached out to the company, whose public policy team set her up on a Zoom call with Rep. Darin LaHood (R-Ill.), her representative in the House.
The Connected Commerce Council, a trade group that counts Amazon and Google as funders and partners, also organized a Zoom meeting with Rae and two other Illinois Democrats, Sen. Tammy Duckworth and Rep. Jan Schakowsky. (The lawmakers’ offices did not respond to requests for comment about the meetings.)
Rae is not alone. Two members of Congress, who requested anonymity to speak about a divisive topic, said they have been inundated with calls and emails from entrepreneurs who heard Amazon’s warnings that the legislation might force it to shut down its platform for sellers. The companies have also told lawmakers whose districts are home to Amazon warehouses and Google data centers that the legislation could lessen their voters’ job opportunities, according to two congressional aides, who spoke on the condition of anonymity to speak candidly.
A House member whose district includes a Google data center is hesitating on supporting the antitrust legislation after the lawmaker’s office received similar objections from the local chamber of commerce, one of the congressional aides said.
Amazon itself has bolstered the argument that the bills are bad for business in lawmakers’ backyards. One company lobbyist raised those concerns with the chief of staff to Sen. Mark Warner (D-Va.), arguing that the senator should be more supportive because of Amazon’s new headquarters in Virginia, said three people familiar with the conversation. (Warner did not respond to a request for comment on the record.)
“They’re using scare tactics to try to gain favor with this bill,” said Rep. Ken Buck (R-Colo.), who co-sponsored a companion to the Klobuchar-Grassley legislation as part of a package of tech-focused bills that the House Judiciary Committee approved in June. He said he’s concerned that the tech giants’ efforts might just work.
“They will definitely find some receptive ears,” Buck said. “If the companies get in first, they will be able to help create this perception.”
One Republican Senate aide echoed that concern.
“When you have small businesses in your district reaching out to you, it is very powerful,” said the aide, requesting anonymity because they are not authorized to speak on the record. “These sellers sincerely believe what Amazon is telling them. That’s difficult for a member of Congress to deal with.”
Klobuchar has pushed a counter-narrative in public, arguing in a marathon of floor speeches and a November interview with TBS’ Samantha Bee that her bill would help small and medium-sized businesses compete and expand choice for consumers. Klobuchar held a roundtable with some of the small businesses that she said would benefit from her legislation. She also disputed the worst-case scenarios the big companies’ supporters have offered.
“This bill does not outlaw Amazon Prime,” Klobuchar said during her floor remarks. She added: “Or free shipping.”
Prime — Amazon’s $119-a-year membership program, which comes with benefits like free expedited shipping — is just one sign of the company’s sprawling footprint: It has an estimated 153 million members in the U.S., nearly matching the combined vote totals of Presidents Joe Biden and Donald Trump in last year’s election.
The company says more than 500,000 small and medium-sized businesses in the U.S. sell in the Amazon store, creating more than 1.8 million jobs — all of which, it argues, the legislation “would put at risk.”
“While the legislation doesn’t explicitly ‘ban’ Prime or operating a marketplace alongside first party retail, the bill’s vague prohibitions and crippling penalties would limit our ability to offer those services in their current form,” Amazon’s top lobbyist, Brian Huseman, said in a statement to POLITICO. “We urge Congress to consider these consequences instead of rushing through this ambiguously worded bill.”
Google spokesperson Julie Tarallo McAlister said the search giant and its allies will keep drawing attention to the antitrust bills’ “unintended consequences.”
“We and a wide range of other businesses and industry groups have been clear about the very real concerns with these bills, which would break popular consumer services while making them less private, less safe and less secure,” she said.
The legislation, which has the potential to pass both chambers with bipartisan support, poses a serious threat to the companies’ business models.
The Senate legislation would prohibit Apple, Facebook, Google and Amazon from favoring their own products and discriminating against the rivals who use the companies’ platforms. It has 12 sponsors and co-sponsors — six Republicans and six Democrats — most of whom sit on the Senate Judiciary Committee. The House version backed by Buck and Rep. David Cicilline (D-R.I.), H.R. 3816 (117), has 24 sponsors and co-sponsors so far.
The companies and their allies are fanning out across the Capitol, and beyond, to drum up opposition.
The Connected Commerce Council said it has arranged 23 meetings since June with its small business members and the offices of their representatives or senators. The group has also held five roundtables with members, staffers and small business owners, and says it has gotten more than 7,000 signatures on a letter urging Congress not to “spend precious time and taxpayer dollars going after companies that help small businesses.”
“For the most part, congressional offices have been open to hearing from us, hearing concerns from our members, and trying to get a better understanding of what’s at stake here,” said Rob Retzlaff, the council’s executive director. He added that his group has not been able to meet with Klobuchar herself — “on multiple occasions, it has either gone unheard or ‘we’ll get back to you when the senator is available to meet.’”
Amazon and Google do not often mobilize their legions of customers to rail against legislation, but that’s the lever that they have chosen to pull during this lobbying battle. Amazon has been the most outspoken on the bills, blasting out emails to its listserv of the thousands of online businesses that sell on its site.
The e-commerce giant also set up a website — titled “Support Small Sellers” — encouraging small businesses to raise their concerns directly with elected officials. The bills, the site reads, “would jeopardize Amazon’s ability to operate a marketplace for sellers, potentially resulting in hundreds of thousands of American small and medium-sized businesses losing access to Amazon’s customers and services.”
Google created a similar website about the legislation and sent an email to users of its office tools warning them that the bills could force the tech giant to remove their businesses’ information from its maps and search results.
In addition to Warner in Virginia, Amazon has targeted Grassley’s colleagues in the Iowa delegation, including fellow Republican Sen. Joni Ernst, as well as GOP members of the Senate Judiciary Committee.
“We are having conversations with many lawmakers and their staffs to share our perspective on legislation that we believe will harm our business, our sellers, and our customers,” said Amazon spokesperson Brooke Oberwetter.
On the House side, both companies have targeted their lobbying efforts at rank-and-file members and supporters of the legislation.
A public relations firm representing the Connected Commerce Council has taken the fight to Texas, sending emails to local chambers of commerce that suggested language for tweets and public messaging against the legislation, according to an email obtained by POLITICO.
“The goal is to make sure Texans are aware of these misguided proposals and how they would negatively affect consumers and small businesses across the state – we believe our local chambers across the state are the best messengers,” the email reads.
Rep. Lance Gooden (R-Texas), a co-sponsor of the legislation, said he is not backing down despite the pressure. “I have met with Big Tech companies who attempted to persuade me not to support this bill,” he said. “I disagree with their arguments and believe it is time these companies are held accountable for harming American consumers and small business.”
The bills’ supporters see the companies’ all-hands-on-deck approach as a sign that they are taking the threat seriously.
“The tech giants clearly see that the momentum for Congress to act is growing,” said Stacy Mitchell, a co-director of the Institute for Self-Reliance, an advocacy organization focused on defending communities from concentrated corporate power. “The fact that they have ramped up this level of campaign, attempting to terrify people, is a good indication of the support that reform legislation has.”
But Rae, the Inspire Travel Luggage founder, is waiting to see if the congressional offices she spoke with heed her warnings.
“I hope those staffs heard us,” she said. “We just need to be heard.”