CEOs Question Apple and Google’s “Gate Keeper” Powers

Spotify CEO Daniel Ek at a company press conference

Whether they like it or not, CEOs are becoming more dependent on Internet search engines and mobile operating systems to run their businesses, or at least market their products.

And while that may be great news for the likes of Google and Apple, it’s concerning for businesses that fear they may not be getting the exposure they deserve.

The situation has apparently gotten so restrictive that 10 executives from tech companies, including music streaming services Spotify and Deezer, have written to European officials demanding curbs on big tech companies’ market power.

Their efforts could have profound implications for Apple’s Tim Cook and Google’s Sundar Pichai, the CEOs of myriad companies that operate in Europe, and perhaps other leaders around the world, should a global test case be established.

“Our collective experience is that, where online platforms have a strong incentive to turn into gatekeepers because of their dual role, they can and do abuse their privileged position.”

“Our collective experience is that, where online platforms have a strong incentive to turn into gatekeepers because of their dual role—instead of maximizing consumer welfare—they can and do abuse their privileged position and adopt B2B practices with adverse consequences for innovation and competition,” the CEOs, including Spotify co-founder Daniel Ek, wrote.

Anti-competitive practices, they said, could include restricting access to data or interaction with consumers, bias ranking search results and a preference for their own vertically integrated services.

The CEOs didn’t mention any specific companies, but it was clear they were referring to Apple and Google, which between them dominate the market for smartphone operating systems. Spotify has previously come to blows with Apple, claiming last year that it acted unfairly by rejecting a Spotify app update.

The power that a search engine like Google can have over brands was recently demonstrated by revelations in March that some company advertisements were appearing alongside offensive content, such as terrorist recruitment videos.

AT&T, Johnson & Johnson, McDonald’s, Toyota and Verizon were among dozens of companies that pulled advertising from Google’s YouTube video-streaming service as a result of the scandal, though their tough stance would have prevented their brand from being seen by millions of potential customers.

The latest CEO letter, which was addressed to European Commission president Jean-Claude Junker and other senior officials, comes ahead of an upcoming review of digital regulation in the region.

“We respectfully submit this policy response should be a pro-growth, pro-consumer legislative framework covering B2B practices, based on non-controversial principles like non-discrimination, transparency, consumer choice and interoperability,” the CEOs wrote.

Other signatories included the CEOs of LeKiosk, Rocket Internet, Snips and United Internet.

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Ross Kelly
Ross Kelly is a London-based business journalist. He has been a staff correspondent or editor at The Wall Street Journal, Yahoo Finance and the Australian Associated Press.

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