FTC Memo Calls for Focus on 'Structural Dominance' of Big Tech

FTC Chair Lina Khan sent a memo to staff this week in which she called for the agency to focus on power imbalances and address the “structural dominance” of big companies. The memo’s mention of “next generation technologies” implies a heavy emphasis on the Big Tech Masters of the Universe.

The Verge reports that in a recent memo to staff sent this week, Federal Trade Commission Chair Lina Khan stated her new priorities for the FTC. These include a focus on power imbalance, the reduction of harm to consumers, and a proactive approach to addressing “rampant consolidation.”

Jeff Bezos looking disturbed (Jim WATSON/AFP)

Mark Zuckerberg drinking (Getty/Chip Somodevilla)

Khan stated that the agency should adjust its approach to deal with issues created by “next-generation technologies, innovations, and nascent industries across sectors,” which would imply that Big Tech could be seeing greater scrutiny in the near future.

Khan said that the FTC should be taking a “holistic” approach to its consideration of antitrust violations. “Business models that centralize control and profits while outsourcing risk, liability, and costs also warrant particular scrutiny, given that deeply asymmetric relationships between the controlling firm and dependent entities can be ripe for abuse,” Khan stated.

WASHINGTON, DC – APRIL 21: FTC Commissioner nominee Lina M. Khan testifies during a Senate Commerce, Science, and Transportation Committee nomination hearing on April 21, 2021 in Washington, DC. Nelson was a senator representing Florida from 2001-2019. (Photo by Graeme Jennings-Pool/Getty Images)

Khan said that she wants the agency’s efforts to focus on addressing the root causes of unlawful conduct and incentives such as “conflicts of interest, business models, or structural dominance.” Khan has focused on the issue of structural dominance regularly in the past, writing about it while studying at Yale Law School in a paper where she argued that Amazon avoids monopoly laws to the point that its structural power gives it huge influence across the economy.

Khan’s memo also highlighted previous arguments she has made, taking aim at the “growing role of private equity and other investment vehicles” in ways that “may distort ordinary incentives” and fuel unfair competition. She writes: “Research documents how gatekeepers and dominant middlemen across the economy have been able to use their critical market position to hike fees, dictate terms, and protect and extend their market power.”