January 17, 2020 / 11:01 AM / 2 months ago

'Break up big tech's monopoly': Smaller rivals join growing chorus ahead of Congress hearing

BOULDER, Colo. Jan 17 (Reuters) - In April 2019, Tile.com, which helps users find lost or misplaced items, suddenly found itself competing with Apple Inc, after years of enjoying a mutually beneficial relationship with the iPhone maker.

Apple carried Tile on its app store and sold its products at its stores since 2015. It even showcased Tile's technology at its biggest annual event in 2018 and the startup sent an engineer to Apple's headquarters to develop a feature with the company's voice assistant Siri.

Early the following year, Tile's executives read news reports of Apple launching a hardware product along with a service that resembled what Tile sold. By June, Apple had stopped selling Tile's products in stores and has since hired away one of its engineers.

"After thoughtful consideration and months of bringing our concerns to Apple through regular ... channels, Tile has made the decision to continue raising concerns over Apple's anti-competitive practices," Tile general counsel Kirsten Daru told Reuters in an interview.

The startup will be one of four companies testifying at the latest hearing of the House Judiciary Committee's antitrust subcommittee in Colorado on Friday, urging Congress to look at how these companies use their considerable clout in the online market to hurt rivals.

Similar investigations are underway at the Justice Department, the Federal Trade Commission and a bipartisan collection of attorneys general from dozens of states.

An Apple spokesman said the company has not built a business model around knowing a customer's location or the location of their device, that users have control of such data and they can choose which location services they want enabled or disabled.

In September, House lawmakers asked more than 80 companies for information about how their businesses may have been harmed by any anti-competitive behavior from Amazon.com Inc, Apple, Facebook and Alphabet's Google. In October, Committee Chairman David Cicilline said he expects to have a final report on its probe by the "first part" of 2019.

Another company testifying on Friday is Basecamp, which sells an online project management tool, and has raised concerns about Google's advertising and search practices. Google makes up more than 40% of Basecamp's traffic.

Google allows competitors to purchase ads on Basecamp's trademark, and then blocks consumers from reaching its site, Co-Founder David Heinemeier Hansson told Reuters in an interview. The company has started multiple trademark infringement investigations through Google's internal process, but it is "onerous and slow," he said.

"Google's monopoly on internet search must be broken up for the sake of a fair marketplace," Hansson said. Basecamp is now forced to run a more than $70,000 annual advertising campaign to defend its trademark on Google, he said.

Google spokesman Jose Castaneda said for trademarked terms like names of a business, the company's policy balances the interest of both users and advertisers.

Google allows competitors to bid on trademarked terms because that offers users more choice when they are searching, but if a trademark owner files a complaint, Google blocks competitors from using their actual name in the text of the advertisement, Castaneda said. (Reporting by Nandita Bose in Colorado; Editing by Stephen Coates)

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