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Rhode Island Congressman David Cicilline (D) has suggested imposing on tech companies a form of the Glass-Steagall rules that have been applied to banks. The rules would seek to break up functions of the tech companies to avoid anti-trust issues. Kiran Stacey reports in the Financial Times:
David Cicilline, the head of the House antitrust subcommittee, has suggested imposing a version of the Glass-Steagall rules — which forced banks to separate commercial and investment banking — on the technology industry.
His comments add to growing calls from senior figures in the Democratic party to curb the market power held by the likes of Facebook, Google and Amazon.
In an interview with the Financial Times, Mr Cicilline said: “One of the things that we did in the financial services space is Glass-Steagall, where you separate out functions.
“It’s an interesting idea whether there would be a way to think about separating what platforms do versus people who are selling products and information — a Glass-Steagall for the international [technology companies].”
Antitrust enforcement is emerging as one of the main threats to the US technology industry, as politicians and regulators begin to look more carefully at whether large Silicon Valley companies are stifling competition.
Last week, the Federal Trade Commission said it was setting up a task force to look at competition specifically in the technology industry, which will go as far as reviewing deals that have already been completed. Announcing the task force, Bruce Hoffman, director of the FTC’s bureau of competition, pointed out that the agency had the power to force companies to unwind mergers if it decided to.
Companies such as Facebook, for example, have been accused of ruthlessly buying up or imitating new competitors to make sure they continue to dominate their fields.
Mr Cicilline is one of the most significant voices in the Democratic party when it comes to the technology industry generally, and especially to competition in the sector. His views are likely to play a key role in forming the party’s thinking on how to deal with Silicon Valley in the run-up to the 2020 election and beyond.
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Jeremy Jones, CFA
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