Big tech’s critics see opening as Washington cracks down

Twitter, Google, Facebook on defensive over election ads, amid push for new regulations

WASHINGTON— For years, the biggest technology companies have been virtually untouchable in Washington. The public adored the companies’ new devices, educators embraced their tools and politicians extolled their contributions to the U.S. economy. Even traditionally powerful voices, such as the media and telecom businesses, found little success in criticizing the technology industry.

But now, as American lawmakers look into how Russia used Google, Facebook and Twitter to influence the 2016 presidential election, many critics see a rare opening — and are lining up to take their shots.

Twitter’s woes continued Thursday. Even as the social media company said it was banning ads from accounts owned by Kremlin-backed media companies Russia Today and Sputnik, Twitter revealed that it had overstated its monthly user figures since 2014 after mistakenly including data from third-party applications in its counting.

The company lowered its number of monthly active users by two million for the first and second quarters of this year and by one million for the fourth quarter of 2016.

After the change, the company said it had 326 million users in the second quarter, rather than 328 million.

The reviews site Yelp, which has long complained about the size and power of Google, has filed a new antitrust complaint against the search giant. Media organizations are arguing, to a more receptive Capitol Hill, that internet businesses should have the same advertising disclosure rules that print and television companies do.

And the support behind a sex trafficking bill, which tech companies argue could make them the unfair target of lawsuits, reads like a who’swho list of companies that have long complained about tech’s political sway, including the Walt Disney Co., Oracle and 21st Century Fox.

“We’ve had low points, when we were out of energy and felt like we weren’t heard,” said Jeremy Stoppelman, chief executive of Yelp. “But we feel we have a clean slate now.”

The action is gaining momentum fast. Lawmakers are pushing for regulations for technology companies for the first time in years, encouraged along by big tech’s broad assortment of rivals.

For several weeks, a group of companies, including smaller tech companies and entertainment and retail businesses, has informally begun regular meetings and conference calls to compare notes about Google, Facebook and Amazon and to find a way to join in a stronger opposition force.

“Before, any negativity was a risk for the media business because if you were critical, you could be defined as not getting it and being old school,” said Jason Kint, chief executive of Digital Content Next, a trade group that represents entertainment and news organizations.

“But now the halo is a bit off these companies.”

“It is unfortunate that companies that have been slow to innovate in a changing consumer-first marketplace are looking for wins through regulation or by scoring cheap political points,” said Michael Beckerman, president of the Internet Association, a lobbying group that represents Amazon, Facebook and Google.

The tech giants are lodging a strong defence against newly proposed regulations. Facebook and Google hired high-profile political operatives to thwart changes in election disclosures at the Federal Election Commission and have deployed lobbyists to water down a bill introduced last week that would require social media platforms to disclose the financ- ing behind political ads.

Still, their rivals say that, for the first time in many years, criticism of Silicon Valley is getting a receptive audience.

The clearest opening has been in an unpopular battle that Google, Facebook, Amazon, Microsoft and Apple have waged against a bill aimed to curb sex trafficking. The bill would take away some legal protections for sites that knowingly host content that promotes sex trafficking, a move that the internet companies warn could stifle free speech, even though it would largely exempt the big tech companies from liability. Disney, Oracle and 21 Century Fox have endorsed the legislation.

The tech companies initially pushed back vigorously against the bill. In recent weeks, though, some of them have softened their stance, saying they hope to seek a compromise.

The tech companies are playing defence on other fronts as well. In September, Yelp said it had filed a complaint against Google with the Federal Trade Commission. In the complaint, Yelp argued that Google had violated a promise it made to the commission in 2013 that it would not reuse the content of competitors for its own advantage. With files from Bloomberg