What a Tech Policy Advocate Looks for at CESJanuary 7, 2020
You can watch Charlotte’s #CES2020 panel, “Should Big Tech Be Broken Up?,” below.
Starting Wednesday, I’ll be at CES. This is the tech industry’s annual conference where they show off cool new products, prototypes, or sometimes just ideas of what’s next in tech. I’ve been invited to speak on a panel asking, “Should Big Tech Be Broken Up?” If you’ve been reading my work over the past year and a half, you probably know that I think today’s dominant digital platforms are too powerful, and we’ll need new laws and rules to really promote competition against them — not just antitrust law. But I’m also excited to walk the CES floor and check out the innovations on display. Here’s what I’ll be looking for this week at CES.
Are the innovations potentially disruptive, or on the margins?
Monopolists innovate on the margins. They want to protect the status quo by making only minor changes to the system. They are not pressured by competition to innovate creatively. In antitrust law we have a technical term, “maverick,” to describe a company that is innovating, cutting prices, behaving unpredictably, and just generally pushing it’s industry forward. A maverick can be an existing company or a new startup. But mavericks are often in a less preferable competitive position, so they stand to win from mixing things up. Who are today’s mavericks that are mixing things up? Are they even at CES this year?
It’s sometimes hard to know when a new innovation will be disruptive. Sometimes an innovation that seems like a feature of an existing product is actually poised to take over the space, and this may not be obvious from the beginning. So what we see at CES may not give us the full picture of whether a new innovation is truly disruptive or not. New disruptive innovations are a sign of a dynamic and well-functioning tech industry. If we don’t see much disruption happening, I think it’s a sign that something is wrong in the market.
Are platforms open or closed?
When the tech press writes that smart home devices or smart TVs are big this year at CES, I’m wondering if the only companies that can play in this space are those owned by huge companies. Are we seeing cool new product introductions from Ecobee, Roku, and Sonos, and new companies we haven’t heard of before? Or only from Samsung, Amazon, and Google? Are new companies making cool devices that work on existing platforms consumers already own? If so, what costs are platforms extracting from small innovators in order to allow their products to be interoperable?
Of course, we also need to pay attention to who owns what. The fact that Ring works with Alexa is not a sign of openness, because these are both Amazon products. A platform that has a ton of products that work on it does not necessarily mean it’s an open platform. We need to see that the platform is offering interoperability widely, to new startups and large competitors alike. Are we only able to add new products to a platform when the platform company purchases that product? Are only products that don’t threaten the underlying platform power allowed on the platform? Or is platform access widely available to the types of products consumers want, so we can choose from a variety of companies? These are some of the questions that can help us understand whether competition is really happening, or if an industry is controlled by a small number of big companies.
Who benefits from “smart” products?
It seems like for the past several years at CES, the trend has been more and more types of products being internet-enabled. You may see “takes” online that this is dumb or useless: Why do I need a smart toothbrush? But these products are not dumb or useless. They just may be dumb or useuless for consumers. When I see a company putting an internet-connected, AI-enabled video camera in your refrigerator, for example, I wonder who benefits from that change. Making products internet-enabled, or “smart,” allows the company that sold the product to track how the product is used and analyze that data to improve their marketing, product design, and business strategy. The company can then advertise to us more effectively, get a better understanding of which company they should buy next, or determine how to make us use their product more. The company can merge the data it’s collected with data collected by other companies to learn even more about us than we might imagine. It’s incredibly useful for the company, whether or not we consumers benefit.
In some cases, the beneficiary may be the platform that the smart device works on, not the company that sells the smart device. Platforms have a lot of negotiation power; companies that create products want to make their products work with the best and most popular platforms in order to reach the platform’s audiences. You may trust a cool new app or smart device with your data because it’s actually a useful product in your life, and bad uses for the data collected don’t seem obvious. But the platform that is hosting the product — the smart home platform, virtual assistant, app store, or mobile operating system — may also get the data (or sometimes may exclusively get the data). Data analytics algorithms are increasingly sophisticated and can infer information about you that you would not realize can be inferred from your actions tracked by the smart device, particularly when your data is merged with information from other sources.
What do you think?
I’ll be live tweeting (@CharlottesWWWeb) and doing an “Instagram takeover” of the Public Knowledge Instagram account (@public_knowledge) Wednesday and Thursday at CES. Let me know what you think of the cool new or coming soon products you see, and how you’d answer these questions based on what you’re seeing, reading, and watching at CES.
About Charlotte Slaiman
Charlotte is the Competition Policy Director at Public Knowledge. Prior to joining Public Knowledge, Charlotte worked in the Anticompetitive Practices Division of the Federal Trade Commission, investigating and litigating antitrust conduct violations, including the 2017 case against 1-800 Contacts for manipulating Google search ad auctions. She previously worked as a Legislative Aide to Senator Al Franken, focusing on Judiciary Committee issues including competition, media, and consumer privacy. Charlotte received her J.D. from New York University School of Law and graduated with distinction with a degree in Government from the University of Virginia. Charlotte grew up in the D.C. area and lives in Park View. She loves indie comic books, urbanism, and Maryland blue crabs.