Press Release: @FTC Unanimously Votes to Examine Past Acquisitions by Large Technology Companies

PRESS RELEASE

The Federal Trade Commission issued Special Orders to five large technology firms, requiring them to provide information about prior acquisitions not reported to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act. The orders require Alphabet Inc. (including Google), Amazon.com, Inc., Apple Inc., Facebook, Inc., and Microsoft Corp. to provide information and documents on the terms, scope, structure, and purpose of transactions that each company consummated between Jan. 1, 2010 and Dec. 31, 2019.

The Commission issued these orders under Section 6(b) of the FTC Act, which authorizes the Commission to conduct wide-ranging studies that do not have a specific law enforcement purpose. The orders will help the FTC deepen its understanding of large technology firms’ acquisition activity, including how these firms report their transactions to the federal antitrust agencies, and whether large tech companies are making potentially anticompetitive acquisitions of nascent or potential competitors that fall below HSR filing thresholds and therefore do not need to be reported to the antitrust agencies.

“Digital technology companies are a big part of the economy and our daily lives,” said FTC Chairman Joe Simons. “This initiative will enable the Commission to take a closer look at acquisitions in this important sector, and also to evaluate whether the federal agencies are getting adequate notice of transactions that might harm competition. This will help us continue to keep tech markets open and competitive, for the benefit of consumers.”

The Special Orders require each recipient to identify acquisitions that were not reported to the FTC and the U.S. Department of Justice under the HSR Act, and to provide information similar to that requested on the HSR notification and report form. The orders also require companies to provide information and documents on their corporate acquisition strategies, voting and board appointment agreements, agreements to hire key personnel from other companies, and post-employment covenants not to compete. Last, the orders ask for information related to post-acquisition product development and pricing, including whether and how acquired assets were integrated and how acquired data has been treated.

The Commission plans to use the information obtained in this study to examine trends in acquisitions and the structure of deals, including whether acquisitions not subject to HSR notification might have raised competitive concerns, and the nature and extent of other agreements that may restrict competition. The Commission also seeks to learn more about how small firms perform after they are acquired by large technology firms. These and related issues were discussed during several sessions of the FTC’s 2018 Hearings on Competition and Consumer Protection in the 21st Century, and this study is part of the follow-up from those Hearings.

The FTC has a statutory right under the HSR Act to review acquisitions and mergers over a certain size before they are consummated, and the study will help the Commission consider whether additional transactions should be subject to premerger notification requirements. The orders will also contribute broadly to the FTC’s understanding of technology markets, and thereby support the FTC’s program of vigorous and effective enforcement to promote competition and protect consumers in digital markets.

The Commission vote to approve issuing the Special Orders was 5-0. Commissioners Christine S. Wilson and Rohit Chopra issued a joint statement.

The Federal Trade Commission develops policy initiatives on issues that affect competition, consumers, and the U.S. economy. Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources.

@TatianaCirisano: @SoundExchange Asks @USTradeRep to Help Artists Get Paid Abroad

[I]n a new filing with the USTR for its annual “Special 301” review of intellectual property rights protection, SoundExchange says that six countries deny full national treatment to American producers and performers, because “those countries are not paying them for the same uses that these countries are paying their own national producers and performers” — specifically, for traditional broadcasts, public performances and some digital uses.

The countries are the U.K, France, Australia, Japan, the Netherlands and Canada.

Read the post on Billboard

@dmccabe: IBM, Marriott and Mickey Mouse Take On Tech’s Favorite Law

[Editor Charlie sez:  This is kind of like reverse MIC Coalition.  Time for the Internet Association’s CEO Michael Beckerman (call sign “Big Foot”) to scramble.  Remember him?  Wasn’t he an extra in Zoolander?]

Michael Beckerman

An unusual constellation of powerful companies and industries are fighting to weaken Big Tech by limiting the reach of one of its most sacred laws. The law, known as Section 230, makes it nearly impossible to sue platforms like Facebook or Google for the words, images and videos posted by their users.

Read the post on the NY Times

@loudmouthjulia: Creators finally know how much money YouTube makes, and they want more of it

[Editor Charlie sez:  Hey Susan, do you like apples?]

Alphabet CFO Ruth Porat told investors during an earnings call on Monday afternoon that YouTube pays out a majority of that advertising revenue to its creators. Although Porat wouldn’t say how much of the $15 billion goes to its content makers, she did specify those payouts belong to YouTube’s “content acquisition” costs, which run around $8.5 billion.

For people trying to make their living on YouTube, many feel like they don’t see nearly enough of that $8.5 billion. Top creators tend to earn the most ad revenue via higher rates — as long as their content is advertiser-friendly — because they generate a large number of views. Other advertising revenue then trickles down to the thousands upon thousands of creators who belong to YouTube’s Partner Program.

Many personalities have said they feel like they have to fight for advertising revenue, turning to subscription services like Patreon and signing brand deals since ad revenue isn’t reliable. Now, in the wake of major changes to YouTube’s advertising policies when it comes to content aimed at children (which may include popular video genres like gaming), advertising revenue looks even more fraught.

YouTube has long enticed creators to work on its platform with advertising revenue, but most creators didn’t know how much YouTube was making. Now they do — and, as one YouTube employee told The Verge, this feels like “a real seminal moment.”

Read the post on The Verge

Last week I examined some of the tendentious arguments put forward to oppose bringing Canada’s term of copyright protection into alignment with that of most developed countries. Canada made a commitment in the new NAFTA that it will extend the term of protection by twenty years for most works covered by copyright, although exactly how […]

via Copyright Term Extension in Canada and the Interesting Case of Broadview Press: Is it “Playing the Victim” or Just “Playing the Game”? — Hugh Stephens Blog

@tanyabasu: YouTube’s algorithm seems to be funneling people to alt-right videos

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A new study suggests what we’ve suspected for years is right: YouTube is a pipeline for extremism and hate.

How do we know that? More than 330,000 videos on nearly 350 YouTube channels were analyzed and manually classified according to a system designed by the Anti-Defamation League. They were labeled as either media (or what we think of as factual news), “alt-lite” intellectual dark web, or alt-right.

Read the post on MIT Technology Review

@SoundExchange Payments and Payees Up in 2019

[Editor Charlie sez: Thank you Mike Huppe and the SoundExchange team!]

SoundExchange annual payouts rise 13.1%, or $105.4m, from $802.8m (2018) to $908.2m (2019).

Another interesting stat from SoundExchange: in Q4 2019, the number of payees getting checks from the org stood at 37,035 – up 8.7% on the 34,048 payees receiving money from SoundExchange in Q4 2018.

Those 37,035 payees in the last quarter of 2019 shared $218.8m, while the 34,048 payees from the prior year quarter shared a slightly larger amount, at $345m.

Read the post on Music Business Worldwide

and on Hypebot SoundExchange Annual Payouts Up 13%