TECH

Lawmakers Seek Tech

CEOs’ Emails
Congress opened a new front in the government’s
antitrust probe of giant technology firms, with House
lawmakers demanding emails and other records from
some of the top chief executives in technology.

By Ryan Tracy

Congress opened a new front in the government’s

antitrust probe of giant technology firms, with House
lawmakers on Friday demanding emails and other
records from some of the industry’s top chief
executives as they look for evidence of anticompetitive
behavior.The requests from House Judiciary
Committee leaders from both parties to Amazon.com
Inc., Facebook Inc., Apple Inc. and Alphabet Inc.,
owner of Google, set up potential conflicts between
tech leaders protective of their business tactics and
lawmakers who want to scour their corporate
records.Among other requests, the committee asked
the firms to provide by Oct. 14 reams of documents,
including executive communications and financial
statements as well as information about competitors,
market share, mergers and key business decisions.

The dozens of executives named in the requests include

Amazon founder Jeff Bezos, Facebook CEO Mark
Zuckerberg, Apple CEO Tim Cook and Google’s early
leaders Larry Page, Sergey Brin, and Eric Schmidt.

The companies are likely to resist such carte blanche

access, which could set in motion negotiations with the
House committee over the scope of materials provided,
said William Kovacic, former chair of the Federal
Trade Commission.

“If you want everything, everything will take a long

time,” said Mr. Kovacic, who is now a George
Washington University professor. The next step will be
“intense negotiations between the companies and the
committee about what will be produced,” he said.The
House committee isn’t subpoenaing the records,
though it has the authority to do so—a fact that gives
lawmakers a stick they can use in negotiations over
though it has the authority to do so—a fact that gives
lawmakers a stick they can use in negotiations over
access.

Committee Chairman Jerrold Nadler said the requests

will aid an investigation, begun on June 3, into
“growing evidence that a handful of corporations have
come to capture an outsized share of online commerce
and communications.”

“This information is key in helping determine whether

anticompetitive behavior is occurring,” said Rep. Doug
Collins (R., Ga.), the panel’s top Republican. The
letters were also signed by Reps. David Cicilline (D.,
R.I.) and Jim Sensenbrenner (R., Wis.), the two senior
members of the panel’s subcommittee on antitrust
issues.

The companies didn’t comment Friday. All four firms

have previously said they provide significant benefits to
consumers and face significant competition. They have
expressed willingness to work with authorities.The
congressional probe adds to scrutiny of the tech giants,
which already face a broad antitrust review by the
Justice Department that could lead to formal
investigations. The department has asked Google for
information about previous antitrust probes by other
agencies.

The Federal Trade Commission, the other top U.S.

antitrust enforcer, has opened an investigation of
Facebook, with an early focus on its key acquisitions,
and is questioning third-party sellers who use
Amazon’s marketplace. FTC Chair Joseph Simons
declined to comment Friday on the House letters.State
attorneys general from both parties recently launched
probes of Google, with an early focus on its advertising
business, and Facebook. Authorities in other countries
are also investigating. Officials have said they would
work together on the overlapping probes, although the
extent of that cooperation isn’t known.U.S. sanctions
against the companies, if they come at all, are likely to
be years away and imposed by federal or state enforcers
rather than Congress. Lawmakers can find facts and
change laws, but not bring enforcement actions.The
House probe represents a threat to the firms, even if it
doesn’t result in changes to antitrust laws. Documents
released to lawmakers could become public and serve
as justification to summon top executives to high-
profile hearings. That would create risks to the
companies’ reputations and could fuel political
pressure for a regulatory crackdown.

The House panel’s detailed information requests also

provide hints as to how authorities could try to build
an antitrust case against the firms:

—The request to Alphabet targets 24 products and

services, from advertising technology to YouTube and
the Waze navigation app, seeking executives’
communications regarding acquisitions and how other
businesses interact with Google’s own services.

—The lawmakers asked Amazon to provide executive

communications related to product searches on
Amazon.com and the pricing of Amazon Prime as well
as fees charged to sellers.

—Apple was asked for executives’ emails about search

rankings in its App Store, whether Apple has discussed
copying some third-party apps and the company’s
policy on requiring that apps use Apple’s payment
systems for purchases, an issue raised by Spotify
Technology SA in an antitrust complaint in Europe.
The Wall Street Journal has reported that Apple
routinely lists apps ahead of competitors though the
company’s apps skirt its own rules for rankings.

Apple, which takes a 30% cut from most apps it sells,

has said the App Store encourages competition and
that its cut is justified by the work its staff does
reviewing apps to protect consumers from malware or
other threats. Its apps account for a small fraction of
those available on the store, and it collects money from
only 16% of the 2 million apps available.—Facebook
received questions about its executives’ discussions
around the acquisitions of WhatsApp, Instagram, and
the data-security app Onavo, as well as decisions
related to which third-party apps access its social-
media platform.

Big tech companies have ramped up spending to

influence the new antitrust discourse, as well as other
policy debates, none more so than Google. It is a
funder of at least 33 nonprofit groups that are active in
the antitrust debate across the political spectrum,
according to its public policy transparency
reports.Google is also a financial supporter of minority
lawmaker groups such as the Congressional Black
Caucus Foundation and the Congressional Hispanic
Caucus Institute. It has given substantial sums to state
attorneys general groups over the last decade or so,
including more than $450,000 to the Democratic
Attorneys General Association and more than
$250,000 to the Republican Attorneys General
Association, according to data gathered by the Center
for Responsive Politics.Its Google NetPAC contributed
about $1.9 million to federal candidates and
committees in the 2017-2018 election cycle, according
to federal data, compared with about $1.8 million for
Amazon’s PAC and about $721,000 for Facebook’s.
Amazon leads the group in spending for the 2020
election to date. Apple doesn’t have a PAC.Amazon in
2017 gave $12,500 each to the Democratic and
Republican attorneys general associations. For 2018 it
bumped that up to $50,000 each

Staffers on the Judiciary Committee are simultaneously

dealing with other time-consuming issues, most
notably potential impeachment proceedings. That
said, the bipartisan nature of Friday’s letters reflects
broad support for the probe.“Bipartisan consensus
sends a clear statement to regulators that this isn’t just
one side’s sour grapes,” said Paul Gallant, an analyst at
Cowen Inc.

Mr. Gallant noted that internal emails discussing

stifling competition at Microsoft Corp. became an
issue during that firm’s time under the antitrust
microscope two decades ago.

“This is Congress’ backstage pass. They will be able to

see what company management said privately about
the way they designed their business and about
whether that was actually anti-competitive,” Mr.
Gallant said.Congress has a history of going after
emails, although those from top-level executives tend
to be less revelatory because cautious higher-ranking
people typically send few such online communications,
investigators have found. In 2010, Senate investigators
released an email from then-Goldman Sachs Group
Inc. Chief Executive Lloyd Blankfein in which he
appeared to acknowledge that the firm dodged a bullet
in the financial crisis by betting on a market decline
through taking “short” positions.But generally, emails
from lower-level employees have led to more criticism.
A 2010 probe of the BP PLC oil spill made headlines
when a lower-level employee said in an email “who
cares” about a shortage of parts on a drilling rig before
it exploded. In the General Motors Co. ignition-switch
crisis, the company pinned the blame largely on a
single engineer who received emails warning him of
problems.This isn’t the first time that Congress has
probed whether large tech companies are stifling
competition. In 2011, the Senate Judiciary Committee
hauled Mr. Schmidt, former Google Inc. executive
chairman, for questioning related to whether the
company was abusing its dominance of online searches
by steering users toward its own services at the expense
of rivals. But he emerged largely unscathed, and amid a
weak recovery from the worst recession since the Great
Depression, Congress had little appetite to pursue a
probe into a driver of the U.S. economy.Big Tech
Probes

Here’s a look at the investigations into big technology

companies

Congress: House Judiciary Committee is seeking

executive emails and other records from Google, Apple,
Facebook and Amazon as part of an investigation into
anti-competitive practices.

Justice Department: Investigators are conducting a

broad review of online platforms and impacts on
competition, innovation and consumers. Google is
among the companies under scrutiny.

Federal Trade Commission: The agency is examining

whether Facebook acquired potential rivals such as
Instagram and WhatsApp to head off competitive
threats, and is also looking at complaints about
Amazon.com from rival merchants.

Texas AG Group: A group of state attorneys general led

by Texas is examining whether Google harms markets
for digital advertising and information, undermines
consumer choice and privacy and stifles innovation.NY
AG Group: A group of state attorneys general led by
New York is looking at whether Facebook has stifled
competition, endangered consumer data and reduced
quality of consumer choices.

Write to Ryan Tracy at ryan.tracy@wsj.com