NEWSFLASH: Senate And House Anti-Tech Bills Could Cost $300 Billion
A new economic study by NERA Economic Consulting, commissioned by the Computer & Communications Industry Association (CCIA), finds the recently introduced package of anti-tech bills by the Senate and House could cost approximately $300 billion, hurting US companies, startups, small-to-medium businesses, and consumers. The study is among the first to examine the economic costs of the three House antitrust bills (H.R. 3825, H.R. 3826, and the H.R. 3816) and Senate antitrust bill (S. 2992). In short, the study finds that the bills could:
Impact a wide range of companies:
— In the near term, “the proposed bills create significant regulatory risks not only to the primary targets of the bills but also to no less than 13 additional US companies.” The 13 companies include Berkshire Hathaway, Visa, JPMorgan Chase, Walmart, Mastercard, PayPal, Home Depot, Walt Disney, Bank of America, Comcast, Netflix, Cisco, and AT&T.
— Longer term, the bills could “[limit] the economies of scale and scope for growth for more than 100 US firms,” imposing substantial long-run costs on the US economy.
Harm consumers and SMBs:
— Preliminary analysis finds that the immediate cost of the bills could be “approximately $300 billion,” which could ultimately be “passed through and borne by the consumers and business users of the platforms.” This could be in the form of “higher retail prices and the loss of free and valued services” for consumers and “higher operating costs, the loss of free and valued services, and the loss of revenue channels” for businesses.
— The bills could “effectively prohibit covered platforms from offering both in-house products and services as well as third-party business users’ products and services.”
— For example: Amazon Marketplace could be prohibited from “show[ing] a consumer product from multiple sellers and recommending the offer from a seller with the best combination of price, shipping speed, and history of customer service. Instead, it would have to ask customers to sift through multiple offers themselves.”
Jeopardize US competitiveness:
— The proposed bills could “jeopardize US international competitiveness by applying US-specific size thresholds that would cover US-based online platforms and marketplaces long before they cover foreign competitors with similar global sizes.”
Stifle startup growth:
— The proposed bills could “jeopardize U.S. technological development because the prohibition on acquisitions would eliminate a target audience of many US startups.”
These bills could “discourage the growth of US startups, jeopardize international competitiveness, and overall make American consumers’ lives more expensive and less convenient,” explains NERA economist Christian Dippon, Ph.D. “These bills are ostensibly intended to target only large US tech companies, but in reality, would have economic repercussions on small businesses and everyday products and services that consumers use. Not only would restricting online platforms and marketplaces increase costs to small businesses and consumers, but at least 13 US companies who are not the primary targets stand to be impacted over the next decade. These bills would discourage the growth of US startups, jeopardize international competitiveness, and overall make American consumers’ lives more expensive and less convenient.”
Read the full report here.