American technology firms will face a huge problem if the new proposal of the US Congress passes

The judicial subcommittee on antitrust of the US House of Representatives is investigating the competitive situation in the US technology industry. This subcommittee promises to soon issue a comprehensive reform proposal.

The proposal includes splitting US tech giants like Amazon and Apple. These big tech companies basically own the market and sell their own products in the marketplace. This is often criticized for inhibiting competition and innovation.

The antitrust subcommittee of the US House of Representatives, led by Democratic representative David Cicilline, has been investigating the technology industry for the past year. According to internal sources, the committee will release its report this week. If their proposal passes, it will be the biggest competition law reform in decades.

Republican Representative Ken Buck of Colorado revealed that Cicilline’s proposal would include the use of “Glass-Steagall law” to address technology platforms.

This bill was used to separate the businesses of commercial and investment banks during the Great Depression. Buck said that Cicilline’s proposal would ban tech firms from entering other areas of business and the equivalent of splitting these companies.

For example, Amazon will not be able to sell its own products in its own market. Google cannot continue to operate the world’s largest search engine and YouTube at the same time. Apple will also not be able to maintain and own the App Store app store and offer its own apps.

“The main solution for most companies to compete in the technology market is to create structural segregation through the law,” Buck said .

He agreed with Cicilline’s view that it was necessary to control technology companies and agreed to give opportunities to more competitors.

According to the subcommittee, technology giants do not want the competition to develop. Big companies often buy start-ups before they have a chance to compete. These big tech companies do this with the aim of maintaining their dominance.

However, the court has made it virtually impossible for the government to prevent companies from dominating the acquisitions of new competitors. The subcommittee is also looking for solutions, including a ban on future acquisitions of competitors and start-ups, such as Facebook’s acquisition of Instagram.

Buck said such a ban would prevent start-ups from selling their ideas to other companies for a profit.

Refer to Nytimes