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Judiciary Antitrust Subcommittee Investigation Reveals Digital Economy Highly Concentrated, Impacted By Monopoly Power

WASHINGTON—The House Judiciary Committee’s Antitrust Subcommittee released the findings of its more than 16-month long investigation into the state of competition in the digital economy, especially the challenges presented by the dominance of Apple, Amazon, Google, and Facebook and their business practices.

The report, entitled Investigation of Competition in the Digital Marketplace: Majority Staff Report and Recommendations, totals more than 400 pages, marking the culmination of an investigation that included seven congressional hearings, the production of nearly 1.3 million internal documents and communications, submissions from 38 antitrust experts, and interviews with more than 240 market participants, former employees of the investigated platforms, and other individuals. The full report may be downloaded by clicking here.

“As they exist today, Apple, Amazon, Google, and Facebook each possess significant market power over large swaths of our economy. In recent years, each company has expanded and exploited their power of the marketplace in anticompetitive ways,” said Judiciary Committee Chairman Jerrold Nadler (NY-10) and Antitrust Subcommittee Chairman David N. Cicilline (RI-01) in a joint statement. “Our investigation leaves no doubt that there is a clear and compelling need for Congress and the antitrust enforcement agencies to take action that restores competition, improves innovation, and safeguards our democracy. This Report outlines a roadmap for achieving that goal.”

After outlining the challenges presented due to the market domination of Amazon, Apple, Google, and Facebook, the report walks through a series of possible remedies to (1) restore competition in the digital economy, (2) strengthen the antitrust laws, and (3) reinvigorate antitrust enforcement.

The slate of recommendations include:

Structural separations to prohibit platforms from operating in lines of business that depend on or interoperate with the platform;
Prohibiting platforms from engaging in self-preferencing;
Requiring platforms to make its services compatible with competing networks to allow for interoperability and data portability;
Mandating that platforms provide due process before taking action against market participants;
Establishing a standard to proscribe strategic acquisitions that reduce competition;
Improvements to the Clayton Act, the Sherman Act, and the Federal Trade Commission Act, to bring these laws into line with the challenges of the digital economy;
Eliminating anticompetitive forced arbitration clauses;
Strengthening the Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice;
And promoting greater transparency and democratization of the antitrust agencies.

“After conducting this country’s first major congressional antitrust investigation in decades in which we held hearings, heard from experts and questioned the CEOs of dominant tech platforms, I can say conclusively that self-regulation by Big Tech comes at the expense of our communities, small businesses, consumers, the free press and innovation,” said Congresswoman Pramila Jayapal. “By reasserting the power of Congress, we now have a thoroughly researched and meticulously reasoned roadmap for the work ahead as we rein in anti-competitive behavior, help prevent monopolistic practices and allow innovation to thrive. I’m looking forward to continuing this urgent work.”

“This comprehensive report is a roadmap to a future where digital behemoths with considerable power over their markets are kept accountable to consumers, small businesses, and their workers,” said Rep. Hank Johnson, Chairman of the Subcommittee on Courts, Intellectual Property and the Internet. “By following these recommendations, we can bolster antitrust protections to ensure consumer choice, data privacy, and affordability in online marketplaces. But in doing so, we must also answer the overarching question that we’ve been grappling with: How do we remain a country where small businesses can thrive, even as we shift from brick and mortar to lines of code? That is our challenge now.”

Rep. Val Demings added, “Our investigation revealed an alarming pattern of business practices that degrade competition and stifle innovation. These companies have made remarkable advancements that have shaped our markets and our culture, but their anticompetitive acts have come at a cost for consumers and small businesses. Competition must reward the best idea, not the biggest corporate account. We will take steps necessary to hold rulebreakers accountable. I thank Chairman Cicilline for his leadership, and will continue to work for a fair marketplace and a tech industry that can advance quality of life for every person without undermining it for others.”

“Small businesses are the backbone of our economy and they must be able to compete on a level playing field,” said Rep. Lucy McBath. “We must do all we can to ensure our economy remains fair, our entrepreneurs have the incentive to innovate, and our small businesses are given the opportunity to prosper and create new and good-paying jobs.”

“This investigation has revealed that Apple, Amazon, Facebook, and Google were committed to drowning out competition through unfair and anti-competitive practices – often doing so at the expense of user privacy and innovation,” said Rep. Scanlon. “We must do everything we can to protect consumers and this report is a roadmap to the work that lies ahead. I look forward to developing and introducing legislation to restore fairness to the digital marketplace.”

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Cisco Unveils Plan for Building Internet for the Next Decade of Digital Innovation

SAN FRANCISCO, CA – Cisco today unveiled further details behind its technology strategy for building a new internet — one designed to push digital innovation beyond the performance, economic and power consumption limitations of current infrastructure. A multi-year approach that is defining the Internet for decades to come, Cisco’s strategy is already delivering technology breakthroughs to pave the way for the world’s developers to create applications and services they have only begun to imagine.

Cisco introduced its latest innovation including Cisco Silicon One^TM, the industry’s only networking silicon architecture of its kind; released the new Cisco 8000 Series, the world’s most powerful carrier class routers built on the new silicon; and announced new purchasing options that enable customers to consume the company’s technology through disaggregated business models.

“Innovation requires focused investment, the right team and a culture that values imagination,” said Chuck Robbins, chairman and CEO of Cisco. “We are dedicated to transforming the industry to build a new internet for the 5G era. Our latest solutions in silicon, optics and software represent the continued innovation we’re driving that helps our customers stay ahead of the curve and create new, ground-breaking experiences for their customers and end users for decades to come.”

Building Blocks for the Internet for the Future

Over the next decade, digital experiences will be created with advanced technologies — virtual and augmented reality, 16K streaming, AI, 5G, 10G, quantum computing, adaptive and predictive cybersecurity, intelligent IOT, and others not yet invented. These future generations of applications will drive complexity beyond the capabilities current internet infrastructure can viably support.

For the past five years, Cisco has driven a technology strategy that is building the internet our customers will need for the future success of their business in an advanced digital world. Aimed at solving the toughest problems that will emerge as digital transformation taxes current infrastructure to its breaking point, this strategy will lead to the next-generation of internet infrastructure that combines Cisco’s new silicon architecture with its next-generation of optics. Cisco’s strategy will change the economics behind how the internet will be built to support the demands of future, digital applications and will enable customers to operate their businesses with simpler, more cost-effective networks.

Cisco’s strategy is based on development and investments in three key technology areas: silicon, optics and software.

“Pushing the boundaries of innovation to the next level — far beyond what we experience today — is critical for the future and we believe silicon, optics and software are the technology levers that will deliver this outcome,” said David Goeckeler, executive vice president and general manager of the Networking and Security Business at Cisco. “Cisco’s technology strategy is not about the next-generation of a single product area. We have spent the past several years investing in whole categories of independent technologies that we believe will converge in the future — and ultimately will allow us to solve the hardest problems on the verge of eroding the advancement of digital innovation. This strategy is delivering the most ambitious development project the company has ever achieved.”

Introducing Cisco Silicon One – Breakthrough Unified, Programmable Silicon Architecture

The new Cisco Silicon One will be the foundation of Cisco’s routing portfolio going forward, with expected near-term performance availability up to 25 Terabits per second (Tbps). This is the industry’s first networking chip designed to be universally adaptable across service provider and web-scale markets. Designed for both fixed and modular platforms, it can manage the most challenging requirements in a way that’s never been done before. The first Cisco Silicon One ‘Q100’ model surpasses the 10 Tbps routing milestone for network bandwidth without sacrificing programmability, buffering, power efficiency, scale or feature flexibility.

Traditionally, multiple types of silicon with different capabilities are used across a network and even within a single device. Developing new features and testing can be lengthy and expensive. Unified and programmable silicon will allow for network operators to greatly reduce costs of operations and reduce time-to-value for new services.

“We look forward to working with Cisco as it enters the high-end routing silicon space, collaborating to help meet the next generation of network demands for higher speeds and greater capacity,” said Amin Vahdat, fellow and vice president of Systems Infrastructure, Google Cloud.

“Facebook has been a strong advocate for network disaggregation and open ecosystems, launching key industry initiatives such as the Open Compute Project and the Telecom Infrastructure Project to transform the networking industry,” said Najam Ahmad, vice president, Network Engineering at Facebook. “Cisco’s new Silicon One architecture is aligned with this vision, and we believe this model offers network operators diverse and flexible options through a disaggregated approach.”

“Cisco is changing the economics of powering the Internet, innovating across hardware, software, optics and silicon to help its customers better manage the operational costs to function on a larger scale for the next phase of the Internet,” said Ray Mota, CEO and principal analyst at ACG Research. “As we move to 2020, the timing of delivering operational efficiency will be vital.”

Introducing: Cisco 8000 Series Platform Powered by Cisco Silicon One– Industry Leading Performance

The new Cisco 8000 series is the first platform built with Cisco Silicon One Q100. It is engineered to help service providers and web-scale companies reduce the costs of building and operating mass-scale networks for the 5G, AI and IOT era. Standout features include:

Optimized for 400 Gbps and beyond, starting at 10.8 Tbps in just a single rack unit
Powered by the new, cloud-enhanced Cisco IOS XR7 networking operating system software, designed to simplify operations and lower operational costs
Offers enhanced cybersecurity with integrated trust technology for real-time insights into the trustworthiness of your critical infrastructure
Service providers gain more bandwidth scale and programmability to deliver Tbps in even the most power and space constrained network locations

Global Customer Deployments and Trials

Cisco is working with a group of pioneering customers on deployments and trials of the Cisco 8000 Series. STC, the leading telecom services provider in the Middle East, Northern Africa region, marks the first customer deploying the new technology. Ongoing trials include Comcast and NTT Communications among others.

Optics for 400G and Beyond

Building a new internet that can support future digital innovation will depend on continued breakthroughs in silicon and optics technologies. Cisco is unique in the industry with advanced intellectual property in both areas.

As port rates increase from 100G to 400G and beyond, optics become an increasingly larger portion of the cost to build and operate internet infrastructure. Cisco is investing organically to assure our customers that as router and switch port rates continue to increase, optics will be designed to meet the industry’s stringent reliability and quality standards.

Through the company’s qualification program, Cisco will test its optics to comply with industry standards and operate in Cisco – and non-Cisco hosts. With this program, customers can utilize Cisco optics in applications where non-Cisco hosts have been deployed and have confidence that the optics will meet the reliability and quality standards that they have come to expect from Cisco.

In addition, as silicon and silicon photonics advance, functions that were traditionally delivered in separate chassis-based solutions will soon be available in pluggable form factors. This transition has significant potential benefits for network operators in terms of operational simplicity. Cisco is investing in silicon photonics technologies to effect architectural transitions in datacenter networks and service provider networks that will drive down cost, reduce power and space, and simplify network operations.

Changing the Economics of the Internet with Flexible Business Models

Cisco also announced plans to offer flexible consumption models first established with Cisco’s Optics portfolio, followed by the disaggregation of the Cisco IOS XR7 software, and now including Cisco Silicon One. This new model is highly adaptable and offers customers choice of components, white box, or integrated systems to build their networks. This approach matches the evolving nature of operators selecting discrete or aggregated technology elements for their buildout and creates new economics of the Internet to provide significant business value.

Source: CISCO

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Pinterest files with SEC for proposed IPO

SAN FRANCISCO — Visual search engine Pinterest, Inc. (Pinterest) this week announced it has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission (SEC) relating to a proposed initial public offering (IPO) of shares of its Class A common stock. The number of shares to be offered and the price range for the proposed offering have not yet been determined.

According to The Verge, Pinterest, which launched in 2010, generates revenue by attracting advertisers to its platform where users create boards in which they self-identify their interests. Advertisers try and sell the products that closely match user interests. According to Pinterest, more than 250 million monthly active users have created more than 4 billion boards with a cumulative 175 billion pins saved. The platform itself has processed more than 2 billion searches, many of which Pinterest attempts to visually process using machine (ML) learning-based methods like object and image recognition. Last quarter, the Pinterest rebuilt their infrastructure behind its “product pins.” This update brought to their app current pricing with stock information for all product pins to monetize their platform with new advertisers.

The Verge also reported such an influx of money could drastically shake up the Bay Area landscape by creating waves of new millionaires, a capital injection that could reshape San Francisco and, as a result, the tech industry itself due to the ripple effects it could have on new startups and investments.