- Dominance of US tech giants threatens European politics
- Fixation on corporation tax (which is not an EU competence) must end
- Musicians, artists, writers and film makers being impoverished by tech giants
- Facebook poses a threat to our media and electoral process
ISME, the Irish SME Association is today (21st February) calling for the next Competition Commissioner to take on powerful vested interests among the US technology companies. The Association believes that the incoming EU Commission will need a political heavyweight to take over the Competition portfolio.
Speaking about the negative effect of the dominance of transnational corporations, ISME CEO Neil McDonnell pointed out:
“This is no longer merely an issue of their commercial and market dominance, although that dominance is vast. It is the fact that the dominance of these transnational corporations is now producing significant and negative political, commercial, and social effects in Western democracies, which allow them free rein; unlike the authoritarian countries which know how to control and exploit them.”
The current Commissioner has enjoyed some success with the ‘Google Shopping Case’. However, the real problem with Google/Alphabet is that this conglomerate is now so great, and its dominance in so many background fields of the web is so unchallenged, that even billion-euro fines from the EU will not significantly impact it. Its many acquisitions such as Android, YouTube, Doubleclick, Postini, Admob, Slide, Admelt, Motorola Mobility, Waze, Nest Labs and many more, show that Google long ago ceased to be a search engine. Its commercial dominance is arguably much greater than that of Standard Oil when the US Supreme Court ordered its dissolution in 1911.”
Regarding the ‘Apple Tax’ case taken by Commissioner Vestager, Mr. McDonnell said:
“Commissioner Vestager has demonstrated a fixation on taxation, particularly in the ‘Apple Tax’ case, despite the fact that taxation is not an EU competence. And whatever the failings, if they be so, of the Irish Government in relation to Apple, they are immaterial in the great game of tax avoidance by US multinationals. The Institute on Taxation and Economic Policy report in Washington DC has noted that Amazon enjoyed a negative tax rate in the US in 2018. That is not a misprint. On $10.8bn of US profits in 2018, Amazon got a tax rebate of $130m, equivalent to an effective tax rate of -1.2%.”
On what many tech companies describe as ‘free’, Mr. McDonnell added:
“The threat posed by these tech companies is new and problematic, because much of what they tout is ‘free.’ But that free content has come at the expense of musicians, artists, writers and film makers, who have seen the value of their output disappear as it is ‘shared’ for little or nothing.
The lack of control over these giants is already impacting politically. The BBC Spotlight Investigation into dark money spent on the Brexit referendum shows how the political field is being distorted by invisible actors. Ironically, it is European politics that is being undermined quickest by the unfettered freedom these tech giants enjoy.
The Disinformation and ‘fake news’: Final Report published by the House of Commons Digital, Culture, Media and Sport Committee on 14th February lays bare the extent to which Facebook facilitated interference in the UK’s Brexit referendum and is refreshingly blunt.”
Some of its conclusions include:
Sec 237: ‘The speed of technological development has coincided with a crisis of confidence in institutions and the media in the West. This has enabled foreign countries intent on destabilising democratic institutions to take advantage of this crisis. There has been clear and proven Russian influence in foreign elections…’
Sec 243. ‘Kremlin-aligned media published significant numbers of unique articles about the EU referendum. …researchers analysed the most shared of the articles, and identified 261 with a clear anti-EU bias to the reporting. The two main outlets were RT and Sputnik, with video produced by Ruptly. The articles that went most viral had the heaviest anti-EU bias. …The value for a comparable paid social media campaign would be between £1.4 and 4.14 million.’
Regarding Facebook and Russian disinformation:
Sec 252. ‘…we believe that Facebook knew that there was evidence of overseas interference… We are left with the impression that either [Facebook Policy Director UK, Middle East and Africa] Simon Milner and [Facebook’s Chief Technology Officer] Mike Schroepfer deliberately misled the Committee or they were deliberately not briefed by senior executives at Facebook about the extent of Russian interference in foreign elections.’
ISME CEO Neil McDonnell concluded:
“If small businesses and ‘normal’ politics are to survive, the next Competition Commissioner will have to not merely control, but break up the US tech giants. The CCCTB and Ireland’s Apple Tax case are mere sideshows to that greater issue.”
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