Last week, Sen. Warren unveiled a proposal to “break up Big Tech,” arguing businesses that didn’t exist 25 years ago “are among the most valuable and well-known companies in the world.”
Experts from across the political spectrum, academia, and the tech industry weighed in on the damage the plan would cause to American consumers and businesses alike, saying the proposal will:

—Diminish the global leadership of the American tech sector;

—Reduce innovation and harm consumers;

—Increase prices;

—Impair start-ups and entrepreneurs;

—And reduce the quality and usability of tech products

Read more of what people are saying below.

If enacted, Sen. Warren’s plan would greatly diminish the American tech sector’s global leadership

Tom Donohue, President of the Chamber of Commerce, called Sen. Warren’s plan an “archaic idea” that would hurt consumers and stifle innovation. “The idea of breaking up some of our most successful American technology companies – who lead the world – and regulating them like public utilities would take us back to the stone age, hurt consumers, and stifle innovation. This is not a vision for the future, but an archaic idea that should be dumped in your computer trash can.” (Tom Donohue, “U.S. Chamber Calls Warren Vision of Internet Archaic,” US Chamber Of Commerce, 3/8/19)

Jessica Melugin of the Competitive Enterprise Institute suggested Sen. Warren’s proposal would reduce American tech leadership. “Politicians and their technocrats hacking up big tech companies is bad news for consumers, innovation, stockholders, and private property rights. There’s no need to run this doomed regulatory experiment in the U.S.; European-style meddling has left that continent without one tech company in the global top ten.” (Jessica Melugin, “Plan to Break Up Tech Companies ‘Bad News for Consumers, Innovation,'” Competitive Enterprise Institute, 3/8/19)

Geoff Manne and Alec Stapp of ICLE write on the potential stagnation that would result from a policy like Sen. Warren’s, as demonstrated by water, electricity, and sewage industries. “For an overview of what the future of tech would look like under Warren’s ‘Platform Utility’ policy, take a look at your water, electricity, and sewage service. Have you noticed any improvement (or reduction in cost) in those services over the past 10 or 15 years? How about the roads? Amtrak? Platform businesses operating under a similar regulatory regime would also similarly stagnate. Enforcing platform “neutrality” necessarily requires meddling in the most minute of business decisions, inevitably creating unintended and costly consequences along the way.” (Geoffrey Manne And Alec Stapp, “Elizabeth Warren Wants To Turn The Internet Into A Literal Sewer (Service),” Truth On The Market, 3/9/19)

Sen. Warren’s plan to break up leading tech services would reduce innovation and harm consumers

Carl Szabo, NetChoice general counsel, pointed out Sen. Warren’s plan would increase prices for consumers and small businesses while reducing the quality of tech products. “‘Sen. Warren is wrong in her assertion that tech markets lack competition. Never before have consumers and workers had more access to goods, services, and opportunities online,’ said Carl Szabo, Vice President and General Counsel for NetChoice. ‘Breaking up tech companies would hurt – not help – America’s middle class,’ continued Szabo. ‘Sen. Warren’s proposal would increase prices for consumers, make search and maps less useful, and raise costs to small businesses that advertise online. This proposal is bad for all Americans.'” (Carl Szabo, “NetChoice Challenges Warren’s Hipster Antitrust Assertions,” NetChoice, 3/8/19)

Tom Rogan of The Washington Examiner highlighted the myriad of options consumers have, pointing out Google’s success is the result of consumer choice. “These companies aren’t anti-competitive monopolies. Let’s start with the basics: there are a multitude of search websites online varying from Yahoo, to Bing, to Ask, to AOL. But what makes Google successful is the fact that it is seen by consumers as the best service. Consumers use Google even though Google gives preferred status to its own products. But that’s not Google’s fault, it’s a consumer choice.” (Tom Rogan, “3 Reasons Elizabeth Warren’s Tech Giant Breakup Plan Is Idiotic,” Washington Examiner, 3/8/19)

Washington Post columnist Megan McArdle noted Sen. Warren’s proposal “would probably make the lives of most Americans somewhat worse.” “As a longtime skeptic of antitrust, I note that Warren’s proposal would probably make the lives of most Americans somewhat worse.”

—”Google would be forced to divest its advertising business, a move of little benefit to the average person. It would, however, somewhat impair the cash flows Google uses to fund a bunch of free stuff, such as Gmail and Google Maps.” (Megan McArdle, “Why ‘Break Up Big Tech’ Will Work Better As A Warren Campaign Theme Than As An Actual Policy,” Washington Post, 3/8/19)

Other top Democrats have raised concerns about Sen. Warren’s approach

Rep. Ro Khanna (D-CA-17) argued “we need policies that will foster innovation and consumer choice” and that we should not make blanket statements against big tech companies. “‘Our technology industry is the envy of the world and we need policies that will foster innovation and consumer choice — but we also need stronger enforcement of antitrust law,’ said Ro Khanna, the California House Democrat who represents Silicon Valley headquarters of companies such as Apple and eBay. He said that blanket statements against big tech companies weren’t helpful, but that each company needed to be ‘evaluated on a case-by-case basis and afforded due process.'” (Astead W. Herndon, “Elizabeth Warren Proposes Breaking Up Tech Giants Like Amazon And Facebook,” The New York Times, 3/8/19)

Sen. Amy Klobuchar (D-MN) said it was “premature” to call for breaking up big tech companies. According to the Wall Street Journal, “Ms. Klobuchar has positioned herself as a bridge builder on the issue who is looking to forge bipartisan support for more aggressive government efforts to protect consumers. ‘Antitrust has to become part of the political discussion,’ she said this week. ‘What’s really important over decades is what’s happening to consumers. We can’t just sit back and do nothing.’ In an interview with The Wall Street Journal Tuesday, Ms. Klobuchar indicated that in her view it was premature to call for breaking up big companies. ‘This is what investigations are for,’ she said when asked her views on unwinding the large firms.” (Brent Kendall and Jacob Schlesinger, “Elizabeth Warren Calls for Breakup of Amazon, Google, Facebook,” The Wall Street Journal, 3/8/19)

Herbert Hovenkamp, a law professor at the University of Pennsylvania, predicted there would be a “lot of pushback” to Sen. Warren’s proposal within the Democratic Party. “Four antitrust experts told Yahoo Finance that it would be highly unlikely that Congress would move to force big companies to spin off parts of themselves. ‘It won’t pass before the next election for sure and I think there’s going to be a lot of pushback even within the Democratic party and the reason is these broad-scale divestiture or breakup provisions are likely to produce much higher prices,’ Hovenkamp noted. ‘Democrats tend to represent a lot of lower income people — they may be the ones who are hurt the most.'” (Erin Fuchs, “The Problem With Elizabeth Warren’s Plan To Break Up Facebook, Google, And Amazon,” Yahoo Finance, 3/8/19)

Sen. Warren’s proposal is not evidence-based and ignores the realities of the tech sector, which is incredibly dynamic

Rob Atkinson, President of ITIF, argued breaking up tech companies based purely on size won’t help consumers. “The Warren campaign’s call to breakup big tech companies reflects a ‘big is bad, small is beautiful’ ideology run amok. The proposal ignores the fact that many of the services big tech companies now provide free used to cost consumers money. Breaking up large Internet companies just because they are large won’t help consumers. It will hurt them by reducing convenience, reducing quality of service and innovation, and in some cases leading to the introduction of priced services.” (Rob Atkinson, “Warren Campaign Wrong On Big Tech, Says Leading Tech Policy Think Tank,” ITIF, 3/8/19)

—”The goal of competition policy should be to enhance consumer welfare, not penalize companies for earning market share and operating at scale—yet that is exactly what the Warren proposal would do.” (Rob Atkinson, “Warren Campaign Wrong On Big Tech, Says Leading Tech Policy Think Tank,” ITIF, 3/8/19)

Ed Black, President and CEO of CCIA, called Sen. Warren’s proposal “unwarranted and extreme.” “The digital sector is a highly competitive part of the US economy, where consumer prices are falling, productivity is rising, and where wages, job creation, and labor share are all outperforming the rest of the economy. I agree with the Senator that competition enforcement is a critical component of a healthy economy. But this unwarranted and extreme proposal, which focuses on a highly admired and highly performing sector, is misaligned with progressive values, many of which are shared within the tech industry.” (Ed Black, “CCIA Responds To Warren Proposal To Break Up Tech Companies,” CCIA, 3/8/19)

The Progressive Policy Institute added that breaking up leading tech services without any evidence of consumer harm would be “an act of stupendous economic folly.” “These are not only America’s most creative companies, but they and other large tech platforms have pioneered a global digital revolution. They’ve grown big because they’ve been successful. That doesn’t make them perfect and, like any private enterprise large or small, they need strong public oversight and regulation. But breaking them up, absent compelling evidence that they are systematically gouging consumers or stifling competition, would be an act of stupendous economic folly.” (“Sen. Warren’s Tech-Bashing Populism Misses The Mark,” Progressive Policy Institute, 3/8/19)

Economist Joshua Gans worried Sen. Warren’s plan would be “another of those things that ends up hurting many without any benefit to anyone.” “I worried [sic] that a breakup rather than an innovative approach to opening up to enhance technology competition will end up being another of those things that ends up hurting many without any benefit to anyone.” (Joshua Gans, “When Breaking Up Makes No Sense,” Digitopoly, 3/8/19)

Startup founders and venture capitalists agree that Sen. Warren’s proposal ignores the nature of the tech sector and could reduce competition

As Mike Masnick of TechDirt noted, Sen. Warren’s proposal ignores the dynamic and in-flux nature of the tech sector. “Twenty-five years ago those companies didn’t exist, and if you asked people what tech companies would take over the world, you’d get very different answers. Technology is an incredibly dynamic and rapidly changing world, in which big incumbents are regularly and frequently disrupted and disappear.'” (Mike Masnick, “Elizabeth Warren Wants To Break Up Amazon, Google And Facebook; But Does Her Plan Make Any Sense?” TechDirt, 3/8/19)

Coinbase CTO Balaji Srinivasan tweeted that preventing tech acquisitions would actually reduce competition and harm startups. If big companies “are prevented from acquiring startups, that actually reduces competition. The reason is that if there is less M&A due to legal uncertainty, there is a reduced incentive for angels & VCs to fund those startups in the first place. Just like SOX made IPOs hard, the wrong policy could make it hard to get acquired. And like SOX, there would be unanticipated consequences. No IPOs led to companies staying private and massive expansion of VC. Closing off bigco M&A too might mean turning to crypto for liquidity. A regulation that purports to reduce the power of a large company frequently ends up increasing it, by erecting barriers to entry for startups. Often that barrier is licensing. In this case the barrier would be reduced access to capital.” (Balaji Srinivasan, Twitter, 3/8/19)

Venture capitalist Ben Narasin argued breaking up the most successful American companies “makes no sense” and would “slow down our country, our economy, and our ability to innovate.” “‘Decades ago, at the peak of Japanese growth as a technology competitor on the global stage, the U.S. government sought to break up IBM. This is not a new model, and it makes no sense,’ says Narasin. ‘We slow down our country, our economy and our ability to innovate when the government becomes excessively aggressive in efforts to break up technology companies, because they see them through a prior-decades lens, when they are operating in a future decade reality. This too shall pass.'” (Jonathan Shieber, “Venture Investors And Startup Execs Say They Don’t Need Elizabeth Warren To Defend Them From Big Tech,” TechCrunch, 3/8/19)