Letters: Pro-Worker, Anti-Monopoly
September 1, 2024Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:
Let's dive in.
Labour Day: Celebrating Workers and CompetitionAs Labour Day approaches, CAMP is reflecting on the complementary role that pro-worker and anti-monopoly policy can and should play in the economy. Long ignored by the traditional antitrust community, the importance of protecting workers with anti-monopoly policy is beginning to have a renaissance. But as usual, some countries are pulling ahead of others. Take Canada and the U.S. for instance, who have both made strides but have taken different paths towards the same goal. In Canada, important legislative reforms have been made to include provisions against wage-fixing and no-poach agreements in our competition laws. Recent amendments also directed the Competition Bureau to include effects on workers in its analysis of mergers. On paper, we're moving in the right direction. But laws are only as good as their enforcement, and Canada has yet to bring a case making use of the amended law. In the U.S. on the other hand, the Federal Trade Commission (FTC) and Department of Justice (DOJ) aren't just talking the talk. This week both agencies announced a partnership with U.S. labour agencies to enhance their own scrutiny of worker impacts in merger reviews. More importantly, they've been bringing cases with labour at the center, putting teeth behind their worker protection mandates. In fact, impacts on workers are a key plank of the FTC’s challenge of the proposed Kroger-Albertsons grocery merger. Union representatives have signaled their low expectations for the solutions proposed by the companies pushing the merger. And they have good reason: they’ve been sold a false bill of goods from merging parties in the past. This Labour Day, we're calling on the Competition Bureau to step up and show the same kind of leadership we're seeing from the FTC and DOJ on worker issues. It's time to breathe life into those legislative changes with bold enforcement. As the cost of living continues to rise, Canadian workers deserve a watchdog with real bite. Yelp Sues Google in Landmark Antitrust CaseHot on the heels of the U.S. court decision that found Google a monopolist in search, longtime foe Yelp has filed an antitrust suit against the search giant. Yelp’s case is an example of how federal antitrust action can create new avenues for individual firms to challenge monopolists. While the DOJ lawsuit focused on Google’s use of distribution agreements to lock up the future of the search market, Yelp's lawsuit alleges that Google has illegally monopolized both general and local search markets through self-preferencing practices. Yelp’s case comes as the remedy for the DOJ search case remains to be decided. As remedy suggestions and analysis come from all sides, search newcomer Kagi has proposed a potentially powerful solution: treating Google's search index as an "essential facility" and opening it up to would-be competitors. This approach could lower barriers to entry for innovative new search products based on the valuable resource at the heart of Google’s monopoly. Each of these developments are encouraging signs of a more competitive future in search, a market core to how we all discover information on the internet. In Canada, the Competition Bureau should take note as it conducts its expanded investigation of Google’s dominance in the online advertising market. Antitrust investigations are only truly successful if their remedies break monopoly power and open up markets to real competition. Court Docs Show Google’s Kingmaker Role in NewsAlways remember to turn your chat history off before talking about your monopoly. Revealed as part of the DOJ's case against Google’s ad tech monopoly, messages show Google employees discussing which news companies should "live or die" amid falling ad revenues at the onset of the pandemic. Even more shocking, there are clear indications the employees knew their actions were likely illegal. The frank discussion of the tech giant’s power comes to an abrupt end when one of the employees realizes they have neglected to turn chat history off, common practice as the company seeks to skirt antitrust laws.
Sigh, indeed. The casual nature of the discussion, as well as the other 22 times employees belatedly realized history was on, reveal just how much power has been handed over to companies like Google. The revelations also underscore a point CAMP has been making for years: the future of Canada's news industry cannot depend on the goodwill of a handful of tech employees in Silicon Valley. As Parliament gears up for another session, Canadian lawmakers must continue to take a hard look at the outsized power of Big Tech over our information ecosystem. While the intentions of individual employees may have been noble, this kind of power needs to rest with citizens of their respective countries. If you have any monopoly tips or stories you'd like to share, drop us a line at hello@antimonopoly.ca |
Letters: No Name No Thanks
August 25, 2024Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:
Let's dive in.
No Name, No Game: Loblaws’ Discount PloyLoblaws' new ultra-discount "No Name" stores are less about bringing real competition to Canada's grocery sector and more about protecting the company's dominant market position. While new CEO Per Bank touts potential 20% savings compared to other discount stores, CAMP sees a familiar flanker brand strategy to crowd out genuine competition. The new stores' limited hours, sparse product selection, and lack of fresh items reveal Loblaw's true priorities. By strategically placing these stripped-down outlets, the grocery giant aims to capture price-sensitive shoppers while preserving margins at its full-service locations. Canadians might be more willing to believe Loblaws was giving them a true low-cost option if the company hadn’t recently moved to reduce discounts on soon-to-expire food items. Real competition would drive sustained price reductions across Loblaw's entire operation, not just a handful of goods at stores that open late and close early. Instead, we're simply seeing an attempt to segment the market and maintain overall profitability. As Canada's largest grocer, Loblaws has real power to meaningfully impact food affordability. This No Name venture suggests they're more interested in protecting their bottom line than helping cash-strapped consumers. Flanker brands are a tactic employed by dominant players to create the image of competition in a variety of sectors, but Canada needs real change rather than marketing ploys to foster genuine competition in our concentrated grocery sector. Without that, Loblaws’ new stores are a change in name alone. U.S. Chicken Farmers Win Nine Figure Antitrust SettlementThe recent $100 million settlement between Pilgrim's Pride and U.S. chicken farmers highlights a troubling reality: concentration issues plague all levels of our food system. From globally concentrated input suppliers to the few processors and retailers who dominate store shelves, farmers find themselves squeezed from all sides. This settlement, addressing claims that major poultry processors conspired to underpay farmers, is just the tip of the iceberg. It reveals how monopolistic practices in agriculture extend far beyond the grocery aisle, impacting the producers who form the backbone of our food supply. The situation mirrors challenges faced by Canadian farmers. Caught between a handful of powerful agribusiness conglomerates and an increasingly concentrated retail sector, our agricultural producers struggle to secure fair prices for their labor, investment, and risk-taking. A comprehensive approach to fostering competition throughout the entire food supply chain is needed. This means scrutinizing mergers not just among retailers, but also among the firms supplying and buying from farmers. Policymakers must consider the cumulative impact of concentration on not just consumer prices but also the role of vulnerable producers. Rather than simply pushing for the lowest cost end product, competition at every stage of food production is essential for a healthy, resilient agricultural system that serves both producers and consumers. Algorithmic Manipulation: Amazon, Landlords and Gas StationsMove over, smoke-filled rooms. A growing trend CAMP has been tracking is the use of algorithms to manipulate the markets around us and facilitate collusion. At the forefront is Amazon, whose advertising practices on its marketplace have come under scrutiny. Recent research by Mariana Mazzucato reveals how the e-commerce giant leverages its algorithmic power to extract what they term "attention rents." By prioritizing sponsored products in search results, Amazon exploits users' tendency to click on top-ranked items, regardless of relevance. This strategy has led to a quarter of first-page results being advertisements, with nearly half of these duplicating organic listings. Here Amazon follows in the footsteps of Google in degrading the quality of its product once its stranglehold has been established. But algorithmic market manipulation is not just the domain of digital giants. Companies are producing software that lets even small time landlords get in on the game. This week the U.S. Department of Justice filed an antitrust lawsuit against RealPage, alleging that its property management software facilitates price fixing in the rental property market. The DOJ claims RealPage's algorithm enables landlords to share sensitive pricing information and align their rents, driving the cost of housing higher for millions of American renters. Thankfully enforcers up north are cluing in to similar trends in Canada. Early this year the Competition Bureau announced it was investigating Kalibrate, a provider of analytics and pricing guidance to gas stations. Similar to the RealPage case, the concern here is that Kalibrate's services might be facilitating coordination between competing gas stations, potentially inflating one of the most politically sensitive prices in the economy. Canadians cannot have the cost of living raised by stealth just because some economists claim it is efficient. We need more assertive investigation of how algorithmic market manipulation is killing competition and greater transparency from companies about their use of these programs. Algorithms are no excuse for collusion. If you have any monopoly tips or stories you'd like to share, drop us a line at hello@antimonopoly.ca |
Letters: Cheering on Competition
August 18, 2024Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:
Let's dive in.
Canadians Should Celebrate U.S. Victory Against GoogleThe landmark U.S. court ruling against Google's search monopoly is a victory for markets around the world, and one Canadians should wholeheartedly embrace. As CAMP Executive Director Keldon Bester argued in the Toronto Star this week, this decision paves the way for a more vibrant digital landscape on both sides of the border. Responding to critics who wrongly claim the ruling will stifle entrepreneurship and innovation, the piece highlights that the decision defends the fair competition that allows for challengers to emerge and fuels the innovative process. But Canada cannot solely rest on the actions of our peers, and the decision is an opportunity for Canada to build on our own burgeoning antitrust moment. Canada’s Competition Bureau has already expanded its investigation of Google’s ad tech practices as a result of action in the U.S. and should extend that vigilance to the markets for search at the heart of the recent ruling. This is critical as the U.S. Google search case moves to the remedy phase, where the presiding judge will determine the appropriate response to Google’s monopolistic conduct. While a bold set of remedies will have global consequences, it cannot be taken as given that the remedy will apply to Canadian markets. Accordingly, Canada must stand ready to take equally bold action to ensure the future of our markets are not beholden to a single gatekeeper. The ruling is a reminder both of the progress of the global antitrust movement and the hard work remaining at home and abroad. Canada must chart a bolder course in digital markets, one that prioritizes innovation, dynamism, and the contest of markets that underpins a healthy economy. CRTC Moves on Fibre Access, But Questions RemainIn welcome news for the future of internet competition, this week the CRTC, Canada’s telecommunications regulator, released its new framework for wholesale high-speed internet access. At its core, the ruling mandates that major telcos like Bell and Telus must provide competitors access to their fibre-to-the-premises (FTTP) networks nationwide, expanding on the temporary mandate in Ontario and Quebec. This broader access could potentially inject a much-needed dose of competition into the high-speed internet market, allowing wholesale competitors to offer comparable services they had sorely lacked in recent years. But the devil is in the regulatory details. While existing fibre assets are included, a five-year "head start" exemption for new fibre builds risks leaving some Canadian internet users in the slow lane for home internet competition. The limited fibre footprint of cable companies like Rogers and Videotron are exempted from the requirement to offer wholesale access, but the same companies will be able to make use of the system to compete outside their home territory. But most critically, the rates at which this wholesale access will be available to competitors remains to be determined. These yet-to-be-set rates will ultimately make or break the effectiveness of this new framework. If set too high, they'll stifle competition before it can take root. But if calibrated appropriately, they could usher in a new era of innovative internet offerings for Canadians. While CAMP welcomes this step towards increased competition, the CRTC must follow through with truly pro-competitive rate-setting to make the effort worthwhile. After years of waiting, Canadians deserve nothing less than a genuinely open and dynamic internet market. CAMP on Campus: Competition, Mergers and Media at the University of CalgaryOne of the most important policy discussions of our time is how to foster a vibrant news media ecosystem able to undergird a healthy democracy. Even before the rise of the digital giants, Canadian media markets have been on a decades-long decline characterized by consolidation, vertical integration and the shuttering of local news outlets. To move this important discussion forward, this week CAMP Executive Director Keldon Bester will be joining columnist David Moscrop and founder of The Line Jen Gerson for Competition and Culture: Discussions on the Economics of News Media and Mergers in Canada at the University of Calgary’s School of Public Policy. The event promises to be a wide-ranging discussion covering the topics such as the history of consolidation and vertical integration in Canadian media markets, the need for action against the giants that make up the foundation of the news business today, and the progress and pitfalls of policy action taken to date in Canada. While there will be diverging views on the correct path forward, continuing the status quo is not likely to be one of them. We encourage Calgarian CAMPers to turn up and add their voice to the discussion. If you have any monopoly tips or stories you'd like to share, drop us a line at hello@antimonopoly.ca |
Why Canadians should celebrate Google antitrust decision
Opinion by Keldon Bester, Executive Director at CAMP.
The U.S. District Court’s historic decision finding that Google had abused its monopoly position has been misportrayed by some as an attack by the government on the free market. Far from it.
Read the full article here.
Letters: Google is a Monopolist
August 11, 2024Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:
Let's dive in.
U.S. DOJ Scores Historic Win in Google Search CaseJudge Amit Mehta's ruling that Google illegally monopolized the search market sent shockwaves through the tech world this week. One of the most durable monopolies of the digital age, the decision is the first step in opening up competition in how individuals access information online and the markets tied to that process. But the next steps in the case will be just as important to the future of competition as the decision itself. The decision validates what domestic and international antimonopoly advocates have long argued - that Google is a monopoly and practices like its multi-billion dollar default agreements with the likes of Apple have effectively crushed competition. The decision shows how far competition law has come at home and abroad. The decision is a far cry from the Canadian Competition Bureau's 2016 shrug that these same practices were harmless and the U.S. Federal Trade Commission’s 2013 decision to abandon its investigation into the search giant, with the intervening decade showing the true durability of Google’s monopoly. But we can’t celebrate just yet. The real test comes in the remedy phase, where Judge Mehta will decide the appropriate solution to the tangled monopoly that Google has been able to weave together. On the table is everything from search choice screens that have generated mixed results in jurisdictions like the E.U. or a dramatic break up of Google’s empire, with crown jewels like its Android operating system and Chrome browser on the table. With appeals likely and a separate DOJ case on Google's ad tech dominance heading to trial on September 9th, whatever the outcome of this case the giant’s woes are far from over. Canada has a role to play here too. With an expanded investigation into Google’s practices in the online advertising market by the Competition Bureau ongoing, CAMP will be pushing for action that ensures Americans aren’t the only ones who benefit from more competitive digital markets. So Close and Yet: Interoperability Not Enough to Fix Social Media MarketsThis week, Globe and Mail columnist Andrew Coyne argued for mandated interoperability as a solution to many issues stemming from the power of social media platforms. While Coyne's recognition of the issues and need for intervention is welcome, it falls short of addressing the root causes of platform dominance. The promise of interoperability, whether in social media, telecommunications, or banking, is that it reduces the friction of customers switching from one service to another, allowing competition to flourish. Interoperability has been a boon to competition in markets like telecommunication, where policy makers forced phone number portability on incumbent telecom companies. But interoperability requires competing destinations for the business of users. By allowing the monopolization of digital markets, policy makers have highlighted one of the limits of interoperability as a check on corporate power. Coyne recognizes the need for regulation but can’t call for it explicitly. His hesitation reflects a broader reluctance to confront the entrenched power of tech giants head-on. While a call for interoperability is in the right spirit, it's ultimately meaningless without heeding the lessons of history in regulating other important sectors. Paired with antitrust action like the Google search case, what is needed is a comprehensive approach that takes cues from the regulatory frameworks applied to other communication and transportation technologies. Just as we've imposed non-discrimination and must-carry provisions on railway, telegraph, telephone, and internet service providers, similar principles should be applied to the dominant methods of communication and accessing information online. Measures like these would ensure fair access and prevent platforms from arbitrarily blocking or limiting the reach of certain content providers, something Canadians are all too familiar with. It is a welcome development that Canada’s policy conversation is coming to grips with the real power held by these companies, but we need to be bold if we hope to restore balance to our digital public squares. Air Canada's Rail Ambitions Raise EyebrowsAs Canada moves to invest in high frequency rail, some familiar monopoly faces are emerging. Air Canada has joined the Cadence consortium bidding for VIA Rail's High Frequency Rail project, a move that's generating significant concern among transportation advocates. Air Canada and SNCF Voyageurs were late additions to the consortium, which is one of three groups vying for the multi-billion dollar project to build a passenger-only route between Toronto and Quebec City. This development has raised several red flags in the transportation sector. Paul Langan, a rail historian quoted by Trains.com, suggests the airline may have ulterior motives: "I think they're in it to try and control it. They'll get all this VIA [Rail Canada] traffic and passenger data. Certainly, a faster and more efficient rail speed would hurt them." CAMP calls on regulators to scrutinize Air Canada’s bid carefully. The High Frequency Rail project is too important for Canada's transportation future to risk its potential derailment from the usual suspects in Canada’s monopolized transportation system. As we push for improved rail infrastructure as an alternative to knit our country together, we must ensure that the process remains fair, transparent, and truly in the public interest. If you have any monopoly tips or stories you'd like to share, drop us a line at hello@antimonopoly.ca |
Tech giants say they’re a boon to AI development, not a threat to competition
The Logic
The billions of dollars flowing through the field of artificial intelligence are helping advance the field, not cement the advantages of today’s technology giants, those firms are arguing to Canadian regulators.