From darlings to pariah: FANG comes under scrutiny by the House Judiciary committee

Six years ago CNBC’s Mad Money host Jim Cramer coined the term FANG – Facebook, Apple, Netflix and Google – as an exclusive club of four high-performing companies which represented the future of technology.

The club explicitly excluded Microsoft, who was the epitome of the old guard, rich, but clearly in decline.

Fast forward half a decade and many of the much-loved companies have acquired a rather nasty reputation of exploitation and abuse, and while the companies have become much richer, they now represent a future most end users do not want to live in.

This has resulted in increased regulatory scrutiny of FANG companies, particularly in Europe, but more recently also in the USA, culminating in a new wide-ranging probe by the FTC and DoJ into anti-competitive practices by these often monopolist companies.

That does not appear to be the end, however. CNN reporter Brian Fung also reports that the House Judiciary Committee is launching their own wide-ranging probe into the practices of Facebook, Amazon, Google and others.

New: The House Judiciary committee is launching a wide-ranging antitrust investigation into the tech industry, covering Facebook, Google, Amazon and others. Depositions, subpoenas, the whole nine yards.

— Brian Fung (@b_fung) June 3, 2019

The bipartisan investigation into competition in digital markets will include a series of hearings held by the Subcommittee on Antitrust, Commercial and Administrative Law on the rise of market power online, as well as requests for information that are relevant to the investigation.

Notably missing is Microsoft, who appears to have morphed from a Mr Burns-type character in the early 2010’s to a much-loved uncle as we approach 2020. Instead of rivalry, Microsoft has embraced partnership and openness, and in recent months appeared to be going out of their way to make their end users happy. Microsoft is also working closely with the government and the Defense Department and has even volunteered to pay more tax.

The Committee’s investigation will focus on three main areas:

• Documenting competition problems in digital markets;
• Examining whether dominant firms are engaging in anti-competitive conduct; and
• Assessing whether existing antitrust laws, competition policies, and current enforcement levels are adequate to address these issues.

It is of course not certain that Microsoft will escape the tech witch hunt, but it is clear Congress has much bigger fish to fry first.