Happy Tuesday! Below: Federal regulators make their plea for more funding, and Apple gets hit with a competition fine overseas. First:
The threat of tougher enforcement appeared to pay dividends. Within a few months, both Microsoft and Apple announced plans to make it easier for consumers to repair their products, a major win for advocates who have long criticized the giants for limiting whether consumers can fix popular tools like the iPhone.
Biden touted those decisions at an event Monday as a sign that his administration’s approach to consumer protection and competition issues is paying off.
The remarks show that even as Biden has remained relatively quiet on some major legislative tech battles, he’s found other ways to effect change in the sector, including by exerting public pressure and leaning on his regulators.
Speaking at a competition meeting with Cabinet members and agency chiefs Monday, Biden credited his administration with pressuring the companies into action.
“What’s happened [is] a lot of these companies said, ‘You’re right. We’re going to voluntarily do it. You don’t have to order us to do it,’ ” he said.
A year into his administration, Biden has been mostly silent on an array of other hot-button tech policy issues, including efforts to pass a federal privacy law, modernize antitrust laws or revamp tech companies’ liability protections, known as Section 230.
Some of those issues have seemingly taken a back seat as Washington has grappled with the pandemic and its economic fallout, among other big-ticket agenda items.
But Biden’s push to expand consumers’ right to repair marks one of the most direct ways in which he has affected big policy changes in the tech sector since entering office.
And he notched those wins by leveraging one of his biggest assets in the push to rein in Big Tech: the aggressive new enforcers he has tapped for key agencies, including at the FTC.
Nathan Proctor, who leads the U.S. Public Interest Research Group’s right to repair campaign, said Biden’s actions helped move the needle in the debate.
“The White House’s support for right to repair has moved the issue forward,” he said. “We've seen companies including Apple and Microsoft begin to loosen their repair restrictions since the White House competition order.”
Sarah Miller, executive director of the anti-monopoly group American Economic Liberties Project, said she hopes the administration takes away from the industry’s reaction to his right to repair actions “that the bully pulpit works” and “the bully pulpit can be very effective.”
But Biden’s efforts to expand the right to repair also show the limitations of this approach.
While Biden has urged the FTC to craft new rules to curtail repair restrictions and the agency has vowed tougher enforcement, they will still need to show they can follow through, including by overcoming what the agency’s leaders have said repeatedly is a lack of adequate funding.
And while major companies are making voluntary commitments to expand the right to repair their products, they are not necessarily bound to stick to them without legislative guardrails.
Like with other tech policy debates, including privacy and antitrust legislation, Biden could help usher in longer lasting changes if he used his bully pulpit to urge Congress to take up the right to repair issue. But it remains to be seen if advancing those efforts will become more of a priority for the administration down the line.
“We’re hoping the FTC can follow up its strong statement of support with real enforcement actions, and that lawmakers in the states and Congress can create new protections to make sure that manufacturers respect our right to repair,” Proctor said.
Still, advocates say not to underestimate the power of the executive branch.
“Legislation would be useful … but I think there are probably creative ways to either use the bully pulpit or the threat of regulatory action or litigation to push more companies to make it possible for consumers to repair their own products,” Miller said.
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The FTC’s Democrats asked for more funding so the agency can review mergers
Federal Trade Commission Chair Lina Khan and FTC Commissioner Rebecca Kelly Slaughter said lawmakers should pair a regular increase in merger filing fees with a boost in funding for the agency.
“We are extremely grateful for the funding increases Congress has provided to the FTC over the past two fiscal years and proposed in the FY 2023 spending bills,” they wrote. “However, even with these increases, it has been a challenge to fully resource the FTC’s competition mission, especially merger review.” They said the number of full-time employees “remains well below what is needed to meet” the challenge of an increasing number of reported mergers.
A Dutch regulator fined Apple for not letting dating apps use payment systems outside its App Store
The 5 million euro ($5.66 million) fine came around a week after Apple said it had complied with an order by the watchdog to let dating app users use alternative payment mechanisms. The Authority for Consumers and Markets said Apple “failed to satisfy the requirements on several points,” Reuters reported.
“The most important one is that Apple has failed to adjust its conditions, as a result of which dating-app providers are still unable to use other payment systems,” the regulator said. “At the moment, dating-app providers can merely express their ‘interest.’ ” The company couldn’t be reached for comment by Reuters. It will be fined nearly 5 million euros every week for a maximum of 50 million euros. It’s currently appealing the watchdog’s December order.
Facebook blames glitches for unexpected costs billed to users of free global Internet service
A Facebook program offering millions of low-income people around the world a free, limited version of the Internet has instead led to them being charged millions of dollars a month, the Wall Street Journal's Justin Scheck, Tom McGinty and Newley Purnell report. In an internal document obtained by the Journal, a Facebook employee said charging people for services Facebook said was free “breaches our transparency principle.”
Part of the problem comes from videos, which aren't supposed to work on the company's free Internet service. But “documents say about 83 percent of the estimated excess charges come from videos that show up anyway because of glitches in the Facebook software that is meant to strip them out, or notify users of charges if they watch videos that do appear,” they write.
A spokesman for Facebook parent Meta said the company has fixed much of the problem but continues to work on it.
Rant and rave
Twitter's reactions to the Wall Street Journal piece on Facebook ranged from criticism of the company to speculation about the source of the internal documents at the center of the story. Writer David Meir Grossman:
Journalist Louise Matsakis:
Tech Policy Press editor Justin Hendrix:
A new leaker/whistleblower? "The documents reviewed by The Wall Street Journal were written in the fall of 2021 and are not part of the information made public by whistleblower Frances Haugen, a former Facebook product manager." https://t.co/8bEB3Py06x— Justin Hendrix (@justinhendrix) January 24, 2022
Inside the industry
- Fordham Law professor Zephyr Teachout is taking a leave of absence to work as a special adviser and senior counsel for economic justice for New York Attorney General Letitia James.
- McKinsey Global Institute head James Manyika is joining Google as its first senior vice president of technology and society.
- Alteryx and Dropbox joined BSA, the Software Alliance, as global members.
- Microsoft holds a conference call on its earnings on Tuesday at 5:30 p.m.
- FTC Commissioner Noah Phillips discusses data privacy at an event hosted by the National Cybersecurity Alliance and LinkedIn on Wednesday.
- Sindy Benavides, the CEO of the League of United Latin American Citizens, discusses the digital divide at a Georgetown University Center for Business & Public Policy event on Wednesday at noon.
- Sens. Ron Wyden (D-Ore.) and Marsha Blackburn (R-Tenn.) speak at an R Street Institute event about a future federal privacy law on Thursday at 2:30 p.m.
- Apple holds a conference call to discuss its earnings on Thursday at 5 p.m.